Alternatives to Xero Accounting Software
Six Alternatives to Xero Accounting Software – Free and Paid Plans
Love it or loathe it, Xero is one of the leading accounting software packages out there now, but it is NOT the only one, whatever people may have you believe.
We wanted to discuss some of the best alternatives on the market so that you can make an educated decision for your business. We have provided links to our in-depth blogs on each one, and below are short summaries that will guide you while deciding which ones to investigate further.
Our top Xero alternatives are:
- QuickBooks Online
- Sage Business Cloud Accounting
- FreshBooks
- Zoho books
- Pandle
- Ember
We’ll start by examining Xero and why you might want to use it as a small company owner. We’ll then conduct a brief overview of the features that a small business needs, as well as a comparison chart.
Overview of Xero
Small businesses often choose Xero accounting software because it is a cloud-based solution that is easy to use. Xero is also compatible with various other programs, making it an attractive option for small businesses looking for an all-in-one solution.
Additionally, Xero offers a wide range of beneficial features for small businesses, such as invoicing, tracking expenses, and creating reports.
Advantages to Xero
There are many advantages to using Xero accounting software for your small business. Some of the key benefits include:
– Cloud-based Software: Xero is a cloud-based program, which means you can access financial data from anywhere with an internet connection. It is beneficial for small businesses that are always on the go.
– Easy to use: Xero is easy to use, even for those unfamiliar with accounting software. It makes it a good choice for small businesses that do not have time to learn a complicated program.
– Compatible with other programs: Xero is compatible with a variety of different programs, which makes it an attractive option for small businesses that are looking for an all-in-one solution
Disadvantages of Xero
Small businesses looking for an easy-to-use accounting software may be drawn to Xero. However, there are a few disadvantages to consider before making a decision.
Xero is not the only cloud-based accounting software available. Many other programs may be a better fit for your business
Xero is not always compatible with other programs. It can be a problem if you are looking for an all-in-one solution
It can be expensive for small businesses. The monthly subscription fee can add up quickly, and the price of additional features can be prohibitive
Xero does not offer as many features as some of the other alternatives
Xero Pricing
Xero has three pricing plans; all include unlimited users:
– Starter: £23 per month – 20 quotes and invoices, 5 bills, bank reconciliation
– Standard: £26 per month – Unlimited invoices and bills, bank reconciliation, short term cash flow statement
– Premium: £33 per month – As above plus multi-currency
There are also additional costs for payroll, tracking projects, submitting CIS returns and claiming expenses. Some alternatives include these costs in their plans.
What to Look for When Choosing Xero Alternatives
Here is a list of key features that small business owners might need to look at when choosing accounting software:
- Pricing – The most expensive isn’t always the best, it will depend on the business and the features required.
- Income and Expense Tracking – Keeping on top of income and expenses are essential. Look for a dashboard where you can track some of the accounts.
- Inventory Management – If you hold stock it is essential that you track it and make it easy for reordering
- Online Payments – Some will accept direct payments on sales invoices, it can help to speed up the process of getting paid.
- Time Tracking – If you are a business that charges by the hour, time tracking might be a feature worth looking at.
- Invoicing Features – Look at the invoicing templates, recurring invoices and the ability to accept payments online.
- Job Costing – Looking at the costs of each job to ensure that you are on track.
- Project Management – Set budgets and keep on top of projects.
- Reports – One of the most important things for any small business is to know the financial health of the business and getting the best reports is essential. These reports include the main financial statements of the Balance sheet, Income and expenses and cash flow forecast.
- How many users – Some packages allow unlimited users while others are restricted and you have to pay monthly for additional users.
- Making Tax Digital – The government is introducing making tax digital for all future tax returns. It is important that the software you choose is making tax digital-ready.
- Bank Account – most will allow multiple bank accounts, but it is worth checking which ones include a bank feed.
1 – QuickBooks online
When it comes to small business accounting software, QuickBooks is one of the most popular. QuickBooks online is the top alternative to Xero Businesses can manage their income and expenditure whilst tracking the financial health of their business. It can send invoices, generate reports, pay bills and prepare taxes.
We recommend QuickBooks Online because it is so easy to use, the features are perfect for small businesses, and reasonable pricing.
As in most paid accounting systems, QuickBooks Online has a 30-day free trial which we would recommend you sign up for if you’d like to try it out first-hand before committing money.
QuickBooks Online Advantages
- Similar features to Xero
- Good Mobile Application
- Easy to use dashboard
- Lots of accounting reports
- Live chat available
- Good selection of invoice templates
- CIS included
QuickBooks Online Disadvantages
- QuickBooks is expensive if you require lots of users – there are only three on the essentials package.
- The learning curve for QuickBooks can be quite steep
- QuickBooks does not have as many features as some of the other accounting software programs on the market
QuickBooks Online Pricing
When comparing QuickBooks Online pricing with Xero, there are a few things to consider. Xero is a more expensive option, but it does have more features. QuickBooks Online has a limit on the number of users.
– Simple Start £12 per month – Single User, Invoices and expenses, accept online payments, bank feed, track mileage, CIS and submit VAT returns
– Essentials £22 per month – up to three users, as above plus, manage bills and multi-currency
– Plus £32 per month – up to five users, as above plus track stock, track employee time and set budgets
2 – Zoho books
Zoho Books is a complete cloud accounting package suitable for both Limited companies and the self-employed and has a free version. It is ideal for keeping stock, tracking expenses, projects, CIS and VAT.
However, if you are new to the world of accounting software, you may find it complicated in the beginning, but if you follow the online guides, you will save both time and money.
If you run a small business with an income under £35,000, then the free version is a great starting point.
It doesn’t require you to have any previous experience with programming or mathematical calculations and displays all of your financial information in a simple format, offering automation features to save you plenty of time.
Zoho offers a complete accounting package and has 40 integrated tools available, allowing your business to complete more tasks using one application.
Advantages of Zoho Books
- All the features you need in one place – 40 applications
- Free plan up to a turnover of £35,000Track project Expenses
- Timesheet and Billing
- Mileage and Expense Tracking
- Will grow with your business
- Good customer support
Disadvantages of Zoho Books
- Standard plan limited to 3 users
- To keep track of bills you require the professional version
Zoho Books Pricing
Zoho Books is a reasonably priced software that can suit the needs of businesses of all sizes. The software offers a wide range of features, so it is popular among businesses. In addition, the pricing for Zoho Books is very reasonable and affordable.
Zoho Books has four pricing plans:
– Free Version up to £35,000, single user plus accountant, mileage tracking, invoice customisation and 1000 invoices per year
– Standard: £12 per month – up to 3 users, bank feeds, 5000 invoices per year, Timesheet and Billing
– Professional £24 per month – up to 5 users, track bills, multi-currency, inventory tracking
– Premium: £30 per month – 10 users, budgeting, custom reports
Zoho Books and Xero are both excellent cloud accounting software packages; however, they do have their differences. Zoho Books is a complete cloud accounting software package suitable for both Limited companies and the self-employed, with a free version available. It offers automation features to save you plenty of time and has 40 integrated tools available.
On the other hand, Xero is more popular among larger businesses as it offers more features such as payroll and advanced inventory management and is easy to use and navigate.
3. FreshBooks
FreshBooks is for small and medium-sized businesses and is a cloud-based accounting and invoice software. It provides the standard features of invoice creation, expense organisation, accounting reports and ultimately helps you get paid.
There is the option to use it on your computer or an app for use with mobiles.
FreshBooks is easy to navigate and set up. It has features like time, mileage and allocating expenses to clients that will help some businesses.
As with choosing any software, it is always worth reviewing your business requirements first to see if the software fits. Take your time and use the available trial.
We feel FreshBooks is best suited to a freelancer who wants to spend minimal time accounting.
FreshBooks Advantages
- Integrates with spplications like Gusto, Squarespace, Stripe, Square and GSuite.
- Create custom reports that only pull the data you need for just your own business needs.
- Single dashboard interface means all of your accounting processes are in one place.
- Lots of features are included in their lite plan, including time tracking features, mileage tracking and importing bank transactions.
- Telephone and online support are available.
FreshBooks Disadvantages
- Cost – the plans limit the number of billable clients; if you have many clients, it can get expensive, and there is a monthly fee for additional users.
FreshBooks Pricing
FreshBooks offers a 30-day free trial for all users.
– The Lite plan is £11 per month – up to 5 billable clients, track expenses, estimates, time tracking.
– The Plus plan is £19 per month – up to 50 billable clients, as above plus, double entry accounting, bank reconciliation and accountant access.
– The Premium plan is £30 per month and includes unlimited clients, email templates, accounts payable, and bill capture.
One thing to consider with FreshBooks pricing is for any additional user; it is £7 per user per month.
4. Sage Business Cloud Accounting
If you’re looking for an alternative to Xero, Sage Business Cloud Accounting could be the right choice for your business.
Sage is a market-leading provider of cloud-based accounting software, and their Business Cloud Accounting package offers all the features you need to manage your finances effectively.
The software is easy to use and can be accessed from any device, so you can keep track of your accounts wherever you are. And with 24/7 support available, you can always get help when you need it
Take a look at our in-depth review of Sage Business Cloud Accounting to find out more, or sign up for a free trial and see for yourself how it could benefit your business.
Sage Business Cloud Accounting Advantages
- Used by lots of accountants, so they can provide expert helpMany add-ons available
- Tailored for different types of industry, including fashion and publishing
- Offers free trial and often 75% discount for first three months
- Lots of features included in plans
- As the business grows Sage can grow with it by upgrading to Sage 200
Sage Business Cloud Account Disadvantages
- It can be expensive, especially if you need to upgrade to a plan with more features.
- Some users have complained about its complex user interface.
- It’s not as simple to use as the competition, and additional training may be required.
Sage Business Cloud Pricing
– Start £12 per month – single user, bank feeds, create and send invoices
– Standard £24 per month – Unlimited users, CIS returns, Quotes, Cash flow statements and manage purchase invoices
– Plus £30 per month – As above plus multi-currency and stock
5. Pandle Free
Pandle is best suited for small businesses but provides excellent value for money because the free tier is fantastic and will meet most needs, however at just £6 a month, the paid tier is excellent value.
It is not as highly automated as you get with some of the more complex software, and it is limited which banks it can be integrated with, but there is some automation with bank feeds and bank rules that automatically categorise transactions for you.
The support is also reliable and responsive.
Overall, Pandle is an excellent free package suitable for small businesses. It is easy to set up and has some features that other software offers. As with any software, it takes a while to get used to and learn where features are.
If you are expecting your business to grow, you may find that you need to look for a different package in time. But if you do decide to change after using Pandle, they will keep your records for six years.
Advantages of Pandle
- Easy to set up
- Some features that other software has to offer
- Reliable and responsive support
Disadvantages of Pandle
- Limited features compared to other software options
- May not be suitable for businesses that are expecting significant growth
- It is not as user friendly as alternatives
Pandle Costs
Pandle is best suited for small businesses but provides excellent value for money because the free plan is fantastic and will meet most needs, however at just £6 a month, the paid tier is excellent value.
6. Ember
Ember is an accounting software package that enables you to automate your accounts and tax, and it can track expenses, send invoices, and more.
It is designed to be used by everyday business owners, but it is perhaps a little less flexible than other software. The tool has invoicing software and a bank feed, but you don’t get to choose whether to use these features — you have to.
The software is easy to navigate, and there is a mobile app for accounting on the go. There is
also, great in-app support from Ember’s chat feature if you have any questions or issues.
Another great plus point of Ember is that it includes support from accountants, company
registration, HMRC registration and tax calculations.
If you are a freelancer running a limited company, it is worth taking a free trial of their software to see if it suits you; we think you’ll find their approach is very user-orientated.
Ember Costs
Sole trader starter – free
Pro – Sole Trader £29 per month with unlimited support from accountants
Private Limited Company – £79 per month with a dedicated team of accountants
Conclusion to Xero Alternatives
When looking for the best accounting software, you’ll want to find one that is not only easy to use but also offers all the features and functionality you need. We’ve compiled five great alternatives to Xero that provide great features designed to help you better manage your business.
When looking at Xero competitors, take out the 30-day free trial to see if the software fits your small business.
Using an accounting software package can save both time and money. Keeping on top of the businesses finances is essential, especially for a successful or growing business.
Article by Angela Boxwell, Content Director at Business Accounting Basics – an online resource for entrepreneurs and small business owners to learn about the essentials of running a business
To read about more Xero Alternatives, check out our business accounting software.
