The best small business accounting software for freelancers should include invoicing, payment collection features, and expense tracking. Powerful time tracking and project tracking are two key components we used in our assessment and tools to facilitate getting paid faster. We looked at several accounting software products and narrowed it down to our top six.
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Top Accounting Software for Freelancers |
Best For |
|
QuickBooks Online |
(Best Overall) Freelancers needing an accounting software that tracks all income and expenses. |
|
FreshBooks |
Freelancers looking for a robust invoicing software with features that streamline the payment process. |
|
Xero |
Freelance companies with a team of employees or looking to begin hiring employees. |
|
ZipBooks |
Solo freelancers with no accounting experience looking to gain insights from business intelligence features. |
|
Zoho Books |
Freelancers using Zoho apps wanting easy accounting software integration. |
|
Wave |
Freelancers looking for an accounting software they can use for free. |
Keeping track of the number of hours worked on a project or job is crucial to freelancers who typically charge their customers by the hour or a flat rate by project. The best accounting software for freelancers must include the ability to track income and expenses, but it must also include a few unique features that will ensure accurate and timely billing as well as tools to facilitate getting paid faster.
We determined which accounting software is best for freelancers based on cost, ease of use, customer reviews, and the following key features:
· Cost: Provide affordable pricing plans for small and large businesses.
· General accounting: Able to keep track of all income and expenses and generate basic financial statements such as profit and loss, balance sheet, and cash flow.
· Time tracker: Users can log hours worked for each project. This will ensure that hours worked are always up to date so you can make sure you stay within the budgeted hours.
· Project tracking: Ability to create projects and track the status of assigned tasks within a project. Stay on top of tasks that have been completed versus incomplete tasks.
· Recurring invoices: Put billing for clients who pay you every week, month, or quarter on autopilot. Set up invoices to automatically go out the day or week you specify.
· Accept payments online: Clients should have the option to pay their invoices online using a debit or credit card.
· Progress invoicing: Able to bill clients in installments after a milestone has been completed. Also need the ability to run a billed versus unbilled report by project.
· Give access to multiple users: Each person working on a project must have access to the system so that they can review and update their tasks and log hours worked.
Based on our assessment of each of the features outlined above, QuickBooks Online is our choice for best freelance accounting software. In addition to including the key features noted above, it includes accounts payable management, inventory, and budgeting, which none of the other providers on our list offered.
The six best accounting software for freelancers are:
QuickBooks is the top accounting software used by most small businesses, especially freelancers. It’s a robust program that is ideal for web designers and bookkeepers who bill by the hour, and it works well for businesses that sell products. Pricing plans start at $20 per month. Most accountants use QuickBooks, which makes it easy to find a QuickBooks expert to help you get started. Whether you are a freelancer or a small business with employees, QuickBooks Online (QBO) will work for you.
QuickBooks Online comes in three pricing tiers that run between $20 and $60 per month versus $15 to $50 per month for FreshBooks plans. Unfortunately, only the Essentials and Plus plans are ideal for freelancers. The primary differences between the Essentials and the Plus plans are the number of users you can give access to and the ability to create budgets and track inventory. Check out our QuickBooks Online Comparison guide to learn more.
|
|
Simple Start |
Essentials |
Plus |
|
Monthly Pricing |
$20 |
$35 |
$60 |
|
Number of Users Included |
1 plus 2 accountants |
3 plus 2 accountants |
5 plus 2 accountants |
|
Accounts Payable |
✔ |
✔ |
|
|
Time Tracker |
✔ |
✔ |
|
|
Project Tracking |
✔ |
✔ |
|
|
Accounts Receivable |
✔ |
✔ |
✔ |
|
Recurring Invoices |
✔ |
✔ |
✔ |
|
Accept Online Payments |
✔ |
✔ |
✔ |
|
Progress Invoicing |
✔ |
✔ |
✔ |
The QuickBooks Online pricing plans are:
QuickBooks Simple Start is the least expensive of the three QBO tiers at $20 per month, but it’s the most expensive starter plan of all the providers on our list. It includes one user plus one accountant user, the ability to invoice customers, create recurring invoices, accept online payments, and manage progress invoicing. Unfortunately, it does not have the ability to track and pay bills, track projects, or keep track of hours worked by subcontractors.
Unfortunately, the Simple Start plan is not ideal for freelancers for a number of reasons. The inability to track and pay vendor bills, track projects, and track hours worked by subcontractors are the main reasons why we do not recommend QuickBooks Simple Start.
QuickBooks Essentials is the middle tier plan at $35 per month, which is $10 more per month than the FreshBooks mid-tier plan at $25 per month. For the extra money, you get additional features such as the ability to track and pay vendor bills and bill an unlimited number of customers versus no accounts payable in FreshBooks and a limit of 50 customer billings per month.
QuickBooks Essentials is ideal for solo freelancers or those with a team of employees or subcontractors; whether you are working on one big project or several projects, you can keep track of hours, income, and expenses by project with QuickBooks Essentials.
QuickBooks Plus is the top tier plan; it runs $60 per month, which is three times the cost of QuickBooks Simple Start. For the additional cost, QuickBooks Plus includes five users plus two accountants versus the three users plus two accountants that Essentials has. You can also create budgets and run budget versus actuals reports and track inventory with QBO Plus.
QuickBooks Plus is ideal for freelancers with both employees and subcontractors. If you need the ability to give more than three users access to your data and you can benefit from using the budgeting feature, or you have products in inventory, then this plan is ideal for you.
The one downside to QuickBooks Online is that the most affordable plan, Simple Start, is not ideal for freelancers who need to keep track of accounts payable; this feature is not available in the QBO Simple Start plan. However, both QuickBooks Essentials and Plus go beyond the key features we have identified as important to freelancers who are looking for the best accounting software for their business.
Customers who use QuickBooks Online like how user-friendly the program is, and they also like being able to stay on top of their data on-the-go by using the mobile app. On the downside, good customer service tends to be hit or miss at best. To learn more, check out our QuickBooks Online reviews page.
To see if QuickBooks Online is right for you, you can qualify for up to a 50% discount off a paid account. Once you create your account, start using all of the great features that we have shared with you, like project tracking, time tracking, and managing all of your income and expenses.