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Best Accounting Software for small business for 2022

Best Accounting Software for small business for 2022

The best accounting software for small businesses isn’t a one-size-fits-all solution, and your choice will vary greatly by industry and your persona

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The best accounting software for small businesses isn’t a one-size-fits-all solution, and your choice will vary greatly by industry and your personal preferences, which we’ll cover in this guide. We selected our top accounting software for small businesses based on pricing, ease of use, and how they perform across various accounting tasks, such as invoicing, project management, and inventory accounting.

Our experts developed an internal case study to evaluate each application and compare them head-to-head. Based on it, here are our top five recommendations, plus a couple of bonus recommendations for alternatives to traditional bookkeeping software:

  • QuickBooks Online: Best overall small business accounting software with project, class, and location tracking that can be customized for any industry (8.8 out of 10)
  • Zoho Books: Best for use on a mobile app (8.7 out of 10)
  • QuickBooks Desktop: Best for managing the books of multiple companies (8.5 out of 10)
  • Xero: Best for unlimited users (8 out of 10)
  • Sunrise: Best free accounting software for businesses needing only basic tracking of income and expenses (5.7 out of 10)
  • Bench: Best online bookkeeping service as an alternative to do-it-yourself (DIY) accounting software (no score*)
  • Bill.com: Best accounts payable software for advanced bill pay features and approval workflows (no score*)

*Bench and Bill.com aren’t complete bookkeeping systems and, therefore, weren’t evaluated in our case study. However, they’re excellent alternatives to traditional accounting software for small businesses with specific needs.

Comparison of Best Small Business Accounting Software

Which Accounting Software is Best for You?

Rank the following software features from most important to least important for your company. Based on your rankings, we’ll provide a customized score for each of the software including in this buyer’s guide.

QuickBooks Online: Best Overall Small Business Accounting Software

QuickBooks Online is our best small business accounting software because of its strong feature set, including the ability to create classes and locations for tracking income and expenses. In our case study analysis, it excelled in inventory accounting, bank account management, invoicing, bill management, and reporting. It’s easy to see why it has 5.5 million small business subscribers.

Despite the cloud-based platform’s sophisticated feature set, it’s easy to use and allows you to share data and files effortlessly with employees, certified public accountants (CPAs), and tax professionals. It’s a versatile program that you can customize to industries, such as churches, restaurants, and nonprofits. With tiered subscription levels, it can scale as your business grows or your needs change.

QuickBooks Online

QuickBooks Online logo

Overall Score: 8.80
OUT OF 5

What We Like

  • Track income and expenses by classes and location
  • Excellent inventory tracking with automatic calculation of cost of goods sold (COGS)
  • Easy access to local independent QuickBooks ProAdvisors
  • Excellent bank reconciliation features

What’s Missing

  • A bit expensive compared to other similar software
  • Requires Plus subscription to track inventory and project profitability
  • Unable to enter bills or record time worked from the mobile app

Read our review of QuickBooks Online

Pricing & Plans

  • Simple Start: $25 per month for one user
  • Essentials: $50 per month for up to three users
  • Plus: $80 per month for up to five users
  • Advanced: $180 per month for up to 25 users

Compare the features of each plan in our QuickBooks Online comparison guide.

  • Construction: QuickBooks Online, when integrated with Buildertrend, provides excellent project accounting and construction management tools like employee time and location tracking, customer relationship management (CRM), and a customer portal.
  • Ecommerce retailers: QuickBooks Commerce can be added to QuickBooks Online to provide direct integrations with most ecommerce platforms, reducing the need for expensive third-party connectors.
  • Real estate businesses: The ability to separate activity by class and location makes QuickBooks Online a viable option for property management companies that need to track income and expenses for various segments and locations.
  • Invoicing: QuickBooks Online calculates sales tax rates automatically based on the customer address or transaction location.
  • Trucking companies: TruckingOffice provides a great integration that adds fleet management, IFTA tracking, and dispatching to your QuickBooks Online software.
  • Mac users: QuickBooks Online’s intuitive design and navigation are optimized for Mac users.
  • Bank reconciliation: QuickBooks Online has the most comprehensive bank reconciliation of all the leading accounting software programs on the market. You can reconcile transactions by connecting your bank accounts or manually uploading your files of statements.

  • Location and class tracking: Set up tags to track your income and expenses across different departments, properties, or locations of your business. You can use this feature to determine which department brings the most money to your business.
  • Inventory: Track the cost of inventory on hand and allocate that cost between ending inventory and the COGS.
  • Project accounting: Create project estimates as well as projects to include income, expenses, and wages. A huge drawback we found in QuickBooks Online’s project accounting is that you cannot compare estimated to actual project costs.
  • Invoicing: The best thing about QuickBooks Online’s invoicing feature is that it calculates the sales tax rate automatically to apply to your invoice based on the customer address.
  • Bill Pay: Pay your bill electronically directly from your QuickBooks account, powered by Melio.

It’s hard to go wrong with QuickBooks Online if you can afford the price. It’s very flexible and powerful software that can be customized for nearly any business. The ability to track profit and loss by class and location allows you to see how profitable your business is across different offices, locations, and properties. Another benefit of QuickBooks Online is that you can find a local QuickBooks ProAdvisor in your area easily if you need one. To get the most out of the platform, check out our free QuickBooks Online tutorials.


Zoho Books: Best Accounting Software for Use on a Mobile App

Zoho Books stands out from the other accounting software with its powerful mobile app. We recognized it as the leading mobile accounting app because it can perform almost any accounting task, including sending invoices, accepting online payments, entering bills, and viewing reports. The app also allows the creation of recurring invoices and tracking of time worked, making it our pick for the overall best accounting software for freelancers.

The software is one of the many Zoho apps—which includes Zoho CRM, Zoho Inventory, and Zoho Projects—that can be integrated to give you a comprehensive solution to all your business needs. Zoho Books can be purchased separately as part of the Zoho Finance bundle or as part of Zoho One, which includes all of Zoho’s apps.

Zoho Books

Zoho Books logo.

Overall Score: 8.70
OUT OF 5

What We Like

  • Fee plan has many features
  • Excellent inventory and COGS accounting
  • Mobile app can perform almost any accounting function
  • Integrates with other Zoho apps easily

What’s Missing

  • Free and Standard plans limit the number of invoices that can be sent
  • Can’t track unpaid bills in the Free and Standard plans
  • Could be difficult to find third-party bookkeeping assistance using Zoho Books in the United States

Read our Zoho Books review

Plans & Pricing

  • Free: $0 per month for one user (for businesses with less than $50,000 in annual revenue)
  • Standard: $20 per month for up to three users
  • Professional: $50 per month for up to five users
  • Premium: $70 per month for up to 10 users

You can evaluate Zoho Books with a 14-day free trial.

  • Mobile app: Mobile accounting is one of Zoho Books’ biggest strengths. The mobile app can perform plenty of accounting tasks, including invoicing, accepting online payments, recording bills and bill payments, categorizing expenses from the bank feed, and viewing financial reports.
  • Inventory: Zoho Books has complete features for tracking inventory. You can track inventory on hand and the COGS, adjust the cost of inventory, and categorize expenses based on vendor details, product details, and stock-keeping unit (SKU).
  • Project accounting: Track time worked and assign it to a project or customer, create expenses from a project, and generate an invoice straight from the project.

We believe that conducting business with clients on the go is easier when you have a powerful mobile app like Zoho Books. However, that’s not the only thing it can offer as Zoho Books is also remarkable in other aspects like inventory and project accounting. Whether you’re a large enterprise needing inventory software or a very small business that want a free package, it can be a great option.


QuickBooks Desktop: Best Accounting Software To Manage Multiple Companies

If you manage multiple businesses, then QuickBooks Desktop is for you. All its editions, which we mention later, can be used to keep the books of an unlimited number of companies for a single price—a big advantage over QuickBooks Online. Because of this, QuickBooks Desktop is our top-recommended multicompany accounting software.

Another reason to use the program is it works even when you have no internet connection because it’s locally installed. QuickBooks Pro and Premier are the most popular desktop versions of QuickBooks for Windows, and QuickBooks for Mac has similar features to Pro and is even one of our best accounting software for Mac.

QuickBooks Desktop:

QuickBooks Desktop logo

Overall Score: 8.50
OUT OF 5

What We Like

  • Doesn’t require an internet connection after the initial setup
  • Can manage the books for multiple companies
  • Industry-specific editions available with Premier
  • Eliminates security issues associated with cloud access

What’s Missing

  • Desktop software requires installation and setup
  • Not as easy to use as a cloud-based accounting software
  • Additional users require a separate subscription fee
  • Difficult to share books with an external accountant

Plans & Pricing

Starting in 2022, Quickbooks Desktop is no longer available as a one-time purchase—you must subscribe annually.

  • QuickBooks for Mac: $349.99 per year for one user; $749.99 per year for three users
  • QuickBooks Pro: $349.99 per year for one user; $749.99 per year for three users
  • QuickBooks Premier: $549.99 per year for one user; $1,749.99 per year for five users
  • QuickBooks Enterprise: $1,740 per year for one user; customized pricing for 40 users
  • QuickBooks Accountant: Included with $499 annual QuickBooks’ ProAdvisor membership

Check out our comparison of QuickBooks Desktop products to see which is best for you.

Also, read our QuickBooks Desktop Pro review and QuickBooks Desktop Premier review to learn more.

  • Multicompany accounting: Manage the books for an unlimited number of companies with a single subscription.
  • Advanced inventory management: QuickBooks Desktop offers more advanced inventory tracking than QuickBooks Online. For instance, you can create assembly items to build and track finished goods, which can be useful for manufacturing teams.
  • A/P: Know how much you owe your vendors and suppliers and when bills are due. QuickBooks Desktop lets you record new bills and track outstanding bills until they’re paid.
  • Class tracking: Classes can be customized to represent cost centers or enterprises, making QuickBooks Desktop our leading farm accounting software.

If you prefer locally installed software over a cloud-based program and mobile accounting app, then go with QuickBooks Desktop. Its Pro and Premier editions are very powerful accounting software, perhaps even more powerful than QuickBooks Online. However, they’re more difficult to master and don’t provide the advantages of mobile accounting. Read our in-depth comparison of QuickBooks Online and Desktop to choose the best software for your business.


Xero: Best Accounting Software for Unlimited Users

Xero is cloud-based accounting software with features very similar to QuickBooks and Zoho Books. However, unlike those two, all Xero plans include unlimited users. If you need multiple seats to access and work on your accounting software, then this provider is an ideal choice. While its features are comparable to QuickBooks, it’s considerably less expensive, making it one of our best alternatives to QuickBooks.

Xero

Xero logo.

Overall Score: 8.00
OUT OF 5

What We Like

  • All plans include unlimited users
  • Can manage and track fixed assets
  • Strong project accounting features
  • Excellent inventory management

What’s Missing

  • Limited invoices and bills in the Early plan
  • Cannot keep the books for multiple companies
  • No customer service via telephone
  • Features in the mobile app are limited compared to Zoho Books

Pricing & Plans

  • Early: $12 per month for up to 20 invoices and five bills
  • Growing: $34 per month for unlimited invoices and bills
  • Established: $65 per month for unlimited invoices and bills plus project accounting
  • Unlimited user access: Xero offers a good value for your money as all its plans support an unlimited number of users without any extra cost.
  • Fixed asset management: What makes Xero unique from other accounting software is its fixed asset manager. You can record and track fixed assets like machinery, vehicles, and equipment, set up depreciation entries, and account for gain or loss from a disposal of a fixed asset.
  • Inventory management: Create and track inventory, monitor inventory levels, add inventory items to invoices, and track COGS.

Xero’s unlimited user access makes it a great option for collaborative teams. Its fixed asset manager, which is unique among accounting programs, is useful for manufacturing teams that use different kinds of machinery and equipment in their production. A major drawback to Xero compared to QuickBooks Online is the lack of bookkeeping professionals who support Xero. While Xero has 2.3 million users, most of them are located outside of the US.


Sunrise: Best Free Accounting Software for Basic Tracking of Income & Expenses

Sunrise by Lendio offers free accounting software for small businesses needing basic tracking of income and expenses and a solid invoicing function. Its main weakness is the inability to reconcile your bank accounts to your bank statements, which isn’t a major problem unless you issue a lot of paper checks. If you’re a small business or a freelancer wanting to know where money is going, you should do well with Sunrise, our best free accounting software.

Sunrise

Sunrise logo

Overall Score: 5.70
OUT OF 5

What We Like

  • Free plan contains almost all of Sunrise’s features
  • Set up and manage multiple companies with paid plan
  • Good invoicing feature
  • Mobile app can perform many accounting tasks

What’s Missing

  • No inventory accounting
  • Can’t track costs by project
  • Cannot reconcile bank accounts

Plans & Pricing

  • Free Self Service: Free forever for one user
  • Sunrise Plus: $19.99 per month for unlimited users and companies

Sunrise no longer offers assisted bookkeeping services.

  • Receipt capture: Sunrise lets you capture and store receipts from your browser or with the Sunrise mobile app, helping you organize your expense claims easily.
  • Automatic expense categorization: Upgrade to Sunrise Plus to get automatic expense categorization in your bank feed.
  • Invoicing: This is Sunrise’s greatest feature. You can create customized invoices, send them on a recurring basis, track sales taxes by jurisdiction, and accept short payments from customers.

Sunrise is a great choice if you’re a solo business owner or freelancer looking for a free invoicing solution without the need for professional bookkeeping assistance. It has a decent mobile accounting app and good customer service. If you’re looking for a zero-cost platform that allows more than one user, we recommend Wave. If you need the option to track inventory and project profitability, you’ll need a paid program like QuickBooks Online.


Bench: Best Online Bookkeeping Service as an Alternative to DIY Accounting Software

Your time is valuable, and you should consider outsourcing some of your bookkeeping tasks. Bench is our best online bookkeeping service and will complete your bookkeeping for you in their proprietary software starting at only $299 per month. This is far less than you would pay a local independent bookkeeper, and you can even add on tax filing and advisory services for an additional charge.

Bench

Bench logo.

What We Like

  • Very affordable bookkeeping service
  • Add customized reporting starting at $100 per month
  • All plans include tax-ready financial statements
  • Tax filing will be very simple using its Premium plan

What’s Missing

  • You’ll still have to issue your own invoices
  • Proprietary software could make it hard to switch to another provider
  • Software doesn’t sync with QuickBooks for invoicing

Plans & Pricing

  • Essential: $299 per month
  • Premium: $499.99 per month; includes income tax advice and return filing
Add-ons
  • Historical bookkeeping: Catch up prior bookkeeping periods for $299 per month
  • Specialized bookkeeping: Track A/R, A/P, or segments starting at $100 per month
  • FreshBooks partnership: Bench is FreshBooks’ largest accounting partner. It can import your invoicing activity from FreshBooks to include in your accounting records.
  • Human bookkeepers: You’ll be assigned a dedicated team of bookkeepers who will produce monthly financial reports based on managing and reconciling your bank accounts.
  • Tax pros: In the Premium plan, you’ll be assigned a tax pro who is available for unlimited tax consultations and will oversee the preparation of your annual income tax returns.

Bench will take care of the most crucial tasks in your bookkeeping process, which is overseeing the import and classification of your bank transactions and reconciling your bank accounts. Compare the hours of headaches this will save you each month, not to mention they will likely make far fewer mistakes than you. We firmly believe that services like Bench should replace the DIY accounting software that many small business owners wrestle with every month.

However, the service doesn’t completely eliminate your bookkeeping tasks. You’ll still need to issue invoices to your customers, collect payments, and pay your bills. These tasks are closely tied to business, and we believe most business owners like maintaining control over these activities. We recommend Zoho Invoice as a great free invoicing program to use if Bench is doing the rest of your bookkeeping.


Bill.com: Best Accounts Payable Software for Advanced Bill Pay Features & Approval Workflows

Bill.com makes it easy for businesses to track and pay large numbers of bills quickly and easily by importing bills from email automatically and allowing for a customized approval process—which is why it’s our top-ranking accounts payable software. What’s more, it integrates easily with both QuickBooks Online and Xero.

Bill.com

Bill.com logo that links to Bill.com homepage.

What We Like

  • Auto-import of bills saves hours of data entry
  • Great approval process
  • Affordable pricing for a few users
  • Direct connection with vendors and customers that also use bill.com

What’s Missing

  • Can be expensive if you need many users
  • A/R functions are pretty basic
  • Not a full accounting software

Plans & Pricing

  • Pay Bills: $39 per user, per month
  • Get Paid: $39 per user, per month
  • Pay Bills & Get Paid: $69 per user, per month
  • Invoice capture: Bills received via email are transferred to your bill list automatically, where you can modify them and then send them on for payment approval.
  • Automatic bill approvers: Bill approvers can be assigned by bill, or you can allow Bill.com to choose approvers based on the settings in your Bill Approval Policies.
  • Dedicated approvers page: Approvers have their own login, where they’ll see only bills that have been submitted for their approval.
  • Bill payments: Once bills have been approved, you can schedule payment through e-payments, internal wire transfers, or check payments.
  • Issue invoices: With the Get Paid plan, you can issue invoices and track the payment of your invoices for customers who use Bill.com.

We recommend Bill.com as it’s a great bill payment solution for managing your accounts payable. Most accounting software comes with some features to manage your bills, but Bill.com goes far beyond these built-in features. Its import process and accuracy is better, and the customized approval process is a must-have for larger organizations.

If you choose to use it for payments, you might also choose to add the Get Paid plan for accounts receivable—but we don’t view that A/R function to be any better than the invoicing features built-in to most accounting software. The only exception is if your customers also use Bill.com, in which case the payment can be collected within the platform and the tracking is done automatically.


Honorable Mentions for Best Small Business Accounting Software

While not rated as best for any particular industry or function, these accounting software programs provide quality options that should be considered.

With unlimited users, Wave is a good choice for service-based small businesses. Although it’s free, its bookkeeping functions and features are useful and provide a solid solution for small businesses on a tight budget. It even offers some of the same features as paid software, such as bank connections, receipt scanning, and invoicing. It makes money by users adding payroll or merchant services to their accounts, but paid software providers also charge extra for these services. Check out our Wave review to find more to love about the program.

Beyond its professional-looking invoices, FreshBooks’ bookkeeping is solid and offers many advanced features like bank connections, receipt scanning, time tracking, and project budgeting and tracking. Read our review of FreshBooks to see if it’s a good fit for your business. You might also enjoy our five free FreshBooks tutorials for an in-depth view of how to use the platform.

Accounting Software for Niche Industries

Some industries have specialized accounting needs that require specialized software. Here are our top picks for specialized industries:

According to the Codat Global Accounting Guide, it’s estimated that 64.4% of small businesses use accounting software to streamline their operations. Based on the US Business Bureau Index, 20% of small businesses that don’t use accounting software struggle to survive within their first year. Financial stability can be achieved by joining the 64% of business owners who do their own bookkeeping by using bookkeeping software to compile the information needed to make informed decisions.

You can read our top bookkeeping and accounting tips to help simplify your bookkeeping and use it effectively. In addition to helping you understand and manage your business’s finances, good accounting software can save you time.


All businesses should have accounting software that can bill customers and track their payments, help manage and track their bills, and provide reports to see how their business is performing. Beyond that, the features needed in accounting software will vary by industry and personal preference.

Invoicing & Tracking Customer Payments

Your accounting software should be able to issue invoices and track them until they’re paid by your customer. It’s also helpful if your software will print an accounts receivable (A/R) aging report, which shows all of your outstanding invoices grouped by how long they’re past their due date. Finally, the best accounting software will track inventory, time, and expenses and allow you to add them to your invoices easily without much manual data entry.

Managing Bills and Tracking Expenses

Ideally, your accounting software should allow you to input bills when you receive them, including their due date. You can receive reminders of upcoming due dates and print an accounts payable (A/P) aging report, grouping bills by how long they’re overdue.

Reporting

At the very least, your accounting software should print a statement of profit and loss and a balance sheet that can be used to prepare your tax returns. It’s helpful if software prints comparative financial statements that show both current and prior year numbers side-by-side.

The best accounting software will print many more reports than basic financial statements. For instance, if your business deals with inventory, a report summarizing the quantity and cost of the current inventory on hand is essential. If your company works on large projects (e.g., a construction company), you’ll want reports that track the profitability of individual projects and compare the actual results to the estimated costs.

Fulfilling Industry-specific Needs

Many industries have specific requirements for their accounting software that might not apply to other industries. For example, restaurants and brick-and-mortar retail stores need a strong point-of-sale (POS) system. For these businesses, it’s important to choose an accounting system that will integrate with a POS system to transfer the data automatically without manual entries, which can cost time and create mistakes.

Other industry-specific needs include time and location tracking of employees, ecommerce platforms, CRM, and subcontractor management.


We evaluated accounting software based on pricing, ease of use, and how well it performed against the ideal features we’re looking for—including project accounting, inventory management, and mobile accounting. Our evaluation was based on a rubric scoring methodology in six categories, each with designated appropriate percentages.

Our criteria for choosing our best small business accounting software are as follows:

5% of Overall Score

We evaluated pricing based on how each plan compares with the other similar software packages as well as how many users are included in each plan and the extra costs incurred per additional user.

40% of Overall Score

The biggest percentage comes from general features because the main reason small businesses need accounting software is to automate business processes like banking, accounts payable and receivable, sales taxes, and reporting.

10% of Overall Score

Many businesses are involved in the sales of products, so it’s essential that the best accounting software has a dedicated inventory management system.

10% of Overall Score

At the very least, a good accounting system should include features for tracking project-related costs for labor, materials, services, and inventory items.

30% of Overall Score

In addition to user interface and navigation, we also consider the available customer support options, including live chat and email and phone support.

5% of Overall Score

Mobile apps are evaluated based on their ability to perform certain tasks like invoicing, online payment processing, and expense receipt capture.

*Percentages of overall score


Bottom Line

There are many terrific small business accounting software applications available, but none of them are as versatile and comprehensive as QuickBooks Online. However, it isn’t always the best solution, especially if you only have very basic needs and wish to save money. If your priority is mobile accounting, Zoho Books might be more suitable. If your business operates in a very specialized industry, you may find QuickBooks Desktop Premier a great choice.

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