Accounting

Best Accounting Software for Small Business (2024)

We are reader supported. When you make a purchase through our links, we may earn an affiliate commission.

In the digital age, selecting the right accounting software is paramount for businesses of all sizes.

Among the leading contenders—FreshBooks, QuickBooks, and TurboTax—each boasts unique features catering to diverse financial needs. Today, we will look into the strengths and weaknesses of these platforms to aid in your decision-making process. From streamlined invoicing to robust tax preparation, we assess how each software optimizes financial management. Whether it’s for a freelancer, small business owner, or a mid-sized company, the importance of reliable accounting software cannot be overstated. Join us as we navigate the landscape to uncover the best-suited solution for your business needs.

Best for Freelancers & Sole Proprietors
Best for Small & Mid-Sized Businesses
Best for Preparation & Simplified Filing of Taxes
Why Choose Them:
Tailored for freelancers and sole proprietors, FreshBooks simplifies invoicing, expense tracking, and time management. With its intuitive platform and user-friendly features, FreshBooks streamlines financial tasks, saving you time and hassle.
Why Choose Them:
Ideal for small and medium businesses, QuickBooks offers comprehensive tools for invoicing, expense tracking, and payroll management. With its scalable solutions and user-friendly interface, QuickBooks simplifies financial management, helping you focus on growth and success.
Why Choose Them:
Whether you're a freelancer, sole proprietor, or a small to mid-sized business, TurboTax simplifies filing processes, ensuring accuracy and maximizing deductions.
4.7
4.9
4.7
Best for Freelancers & Sole Proprietors
Why Choose Them:
Tailored for freelancers and sole proprietors, FreshBooks simplifies invoicing, expense tracking, and time management. With its intuitive platform and user-friendly features, FreshBooks streamlines financial tasks, saving you time and hassle.
4.7
Best for Small & Mid-Sized Businesses
Why Choose Them:
Ideal for small and medium businesses, QuickBooks offers comprehensive tools for invoicing, expense tracking, and payroll management. With its scalable solutions and user-friendly interface, QuickBooks simplifies financial management, helping you focus on growth and success.
4.9
Best for Preparation & Simplified Filing of Taxes
Why Choose Them:
Whether you're a freelancer, sole proprietor, or a small to mid-sized business, TurboTax simplifies filing processes, ensuring accuracy and maximizing deductions.
4.7

FreshBooks

FreshBooks offers a solution tailored to solo business owners, freelancers, and sole proprietors, providing easy-to-use accounting software designed to streamline organization, payment tracking, invoicing, and expense management.

FreshBooks is particularly well-suited for smaller businesses with a single owner-operator, offering an intuitive interface and affordable pricing options. Despite its simplicity, FreshBooks doesn’t compromise on functionality, incorporating double-entry accounting reports and various payment acceptance methods, including credit cards, ACH transfers, Stripe, and PayPal.

Best for Freelancers & Sole Proprietors
With FreshBooks, streamline your invoicing, expense tracking, and time management with ease.

Stay organized, save time, and focus on what you do best – growing your business.

We may earn a commission if you make a purchase, at no additional cost to you.

Pros:

  1. Intuitive and easy-to-use interface.
  2. Affordable pricing, especially at lower tiers.
  3. Incorporates double-entry accounting reports.
  4. Tailored for freelancers, solopreneurs, and small business owners.

Cons:

  1. Not suitable for larger businesses.
  2. Additional cost per month for adding extra team members.
  3. Limited customization options compared to other software.

FreshBooks stands out for its user-friendly dashboard, providing a clear overview of revenue and profit, along with easy navigation through payment, expense, and invoicing functions. The platform’s simplicity doesn’t compromise its capabilities, offering features such as time tracking, tax filing assistance, analytics, and reporting tools crucial for business management.

FreshBooks pricing is reasonable within the accounting software realm, offering essential features for invoicing, expense tracking, and payroll management. The higher tier plans offer more advanced features like double-entry accounting reports, recurring billing, client retainers, and project profitability tracking at higher price points.

Customer support options include phone, email, chatbot assistance, and a comprehensive knowledge base. While FreshBooks excels in providing an intuitive interface and essential accounting features, it may not be suitable for larger companies requiring extensive customization or multiple users.

QuickBooks

QuickBooks Online is a cloud-based accounting software offering comprehensive solutions for various accounting needs. It’s particularly beneficial for businesses working with bookkeepers or accountants, as it allows easy file access sharing. With its intuitive interface and broad feature set, QuickBooks Online is a contender for businesses seeking efficient financial management tools.

Best for Small & Mid-Sized Businesses
QuickBooks: Powering small and mid-sized businesses to success!

Unlock the full potential of your business with our comprehensive suite of tools for invoicing, expense tracking, and payroll management.

We may earn a commission if you make a purchase, at no additional cost to you.

Pros:

  1. Widely used and compatible with bookkeepers and accountants.
  2. Simplifies financial tracking.
  3. Easy implementation process.

Cons:

  1. Relatively expensive subscription model.
  2. Limited customer support options.
  3. Learning curve for correcting errors can be frustrating.

QuickBooks Online provides all the essentials for accounting, invoicing, and expense tracking, making it suitable for small businesses. The software offers a 30-day trial with full access to the Simple Start Plan, allowing users to evaluate its suitability.

With four pricing tiers, QuickBooks Online caters to varying business needs and budgets. Each tier offers additional features, such as multiple user access, bill management, inventory tracking, and advanced analytics.

Additional benefits include the payroll feature, consolidating payroll and benefits management, albeit at an added cost. However, some users find the system cumbersome for simple fixes and note limited support options, particularly at lower-tier plans.

In comparison with competitors like FreshBooks, QuickBooks Online stands out for its popularity among accountants and bookkeepers. However, it’s pricier than alternatives, with support limited to higher-tier plans and community forums.

For mid-sized businesses prioritizing invoicing efficiency and integration with general ledger functions, QuickBooks Online is a viable option. The mobile app further enhances accessibility, offering features like mileage tracking and receipt capture for on-the-go accounting. However, businesses requiring extensive support or seeking more budget-friendly options should explore alternatives.

TurboTax

TurboTax differs significantly from FreshBooks and QuickBooks, primarily in its focus and functionality. While FreshBooks and QuickBooks are comprehensive accounting software tailored for businesses to manage finances, invoicing, expenses, and payroll, TurboTax is primarily a tax preparation software designed for individuals and businesses to file their taxes accurately.

Businesses might prefer TurboTax over FreshBooks and QuickBooks when their primary concern is tax filing and they need assistance in navigating complex tax regulations, maximizing deductions, and ensuring compliance with tax laws. TurboTax, a product of Intuit, stands as one of the most popular tax-filing options, offering comprehensive features and user-friendly design. Its pricing ranges from a free version for simple returns to premium packages catering to those preferring professional assistance.

Best for Tax Preparation
Simplify tax preparation with TurboTax

With TurboTax, filing taxes becomes a breeze, ensuring accuracy and maximizing deductions. Join millions of satisfied users and take the stress out of tax season with TurboTax today!

We may earn a commission if you make a purchase, at no additional cost to you.

Pros:

  1. User-friendly platform with intuitive interview-style questions.
  2. Excellent customer service available via phone, email, or chat.
  3. Simplifies the process by allowing you to upload W-2 or 1099 forms for automatic field completion.

Cons:

  1. One of the priciest options among DIY tax software.
  2. Additional cost for tax expert assistance.
  3. Persistent upselling compared to competitors.

TurboTax’s ease of use is evident in its interview-style question format, guiding users through the tax preparation process smoothly. However, users should be prepared for constant upgrade offers during filing, which might be perceived as intrusive.

While TurboTax offers robust customer support options, including live chat help and a mobile app, additional assistance from tax experts incurs extra fees. Despite its higher pricing relative to its competitors, TurboTax remains a popular choice for its comprehensive features and extensive customer support.

How to choose the best Accounting Software?

Selecting the ideal accounting software is crucial for businesses of any scale, aiding in financial organization, analysis, and decision-making. To ensure you make the right choice, consider these essential factors:

  1. Business Needs: Assess your requirements, including invoicing, payroll, inventory management, and tax preparation. Choose software that aligns with your specific needs.
  2. Scalability: Opt for a solution that can grow with your business. Scalability ensures the software remains effective as your operations expand.
  3. User-Friendliness: Look for intuitive interfaces and easy navigation to streamline adoption by employees with varying levels of technical expertise.
  4. Integration: Compatibility with existing systems, such as CRM or project management tools, enhances efficiency by facilitating seamless data exchange.
  5. Security: Prioritize data security features like encryption, multi-factor authentication, and regular software updates to safeguard sensitive financial information.

When choosing an accounting software, certain features are essential for efficient financial management. Here are key functionalities to consider:

  1. Invoicing: The ability to create, send, and track invoices is vital for maintaining cash flow and tracking payments.
  2. Expense Tracking: A feature enabling the recording and categorization of expenses simplifies budgeting and ensures accurate financial reporting.
  3. Financial Reporting: Comprehensive reporting capabilities, including balance sheets, income statements, and cash flow statements, provide insights into business performance.
  4. Bank Reconciliation: Automated reconciliation of bank transactions with accounting records saves time and minimizes errors.
  5. Payroll Processing: For businesses with employees, payroll functionality facilitates accurate calculation and timely payment of wages and taxes.
  6. Tax Preparation: Software that assists with tax compliance, including tax filing and reporting, helps businesses meet regulatory requirements.
  7. Integration: Compatibility with other business systems, such as CRM or inventory management software, enhances efficiency and data accuracy.

By prioritizing these features, businesses can select an accounting software that meets their specific needs and supports their financial goals.

Verdict

FreshBooks stands out as an ideal choice for freelancers and small businesses, offering streamlined solutions for invoicing, expense tracking, and time management. Its user-friendly interface and intuitive features make it easy for entrepreneurs to manage their finances efficiently.

QuickBooks, on the other hand, caters to businesses of all sizes, providing a versatile solution with robust features such as invoicing, payroll management and integration. Its scalability and comprehensive tools make it suitable for businesses with varying needs, from startups to mid-sized businesses.

TurboTax is specifically tailored for tax preparation, simplifying the filing process for individuals and businesses alike. With its guided approach and comprehensive support, TurboTax streamlines tax-related tasks, ensuring accuracy and compliance with tax laws.

In summary, FreshBooks excels in simplifying financial management tasks for freelancers and small businesses, while QuickBooks offers a versatile solution suitable for businesses of all sizes. TurboTax specializes in tax preparation, providing a streamlined process for individuals and businesses to file their taxes efficiently. Each software serves distinct purposes, catering to different aspects of financial management and ensuring businesses have the tools they need to succeed.

Best for Freelancers & Sole Proprietors
Best for Small & Mid-Sized Businesses
Best for Preparation & Simplified Filing of Taxes
Best for Freelancers & Sole Proprietors
Best for Small & Mid-Sized Businesses
Best for Preparation & Simplified Filing of Taxes