Xero accounting software and online bookkeeping makes it possible to manage invoicing, perform bank reconciliation, and handle standard accounting tasks. It promotes itself as “the QuickBooks alternative.”
QuickBooks has been the gold standard for accounting software and online bookkeeping for nearly an entire generation. It offers users numerous tools that can help to keep track of real-time data so that profits, losses, and inventory management become easier to manage.
Here are the key points of difference between these two accounting software options to consider if you happen to be looking for this type of product for your home or business.
Xero offers three pricing tiers that provide different levels of service.
- For $9 per month, users can send up to 5 invoices and quotes, enter 5 bills, and reconcile up to 20 bank transactions.
- For $30 per month, the restrictions on invoices, quotes, bills, and bank transaction reconciliation are eliminated. You can also perform payroll for up to 5 people.
- For $70 per month, payroll for up to 10 people and have access to multi-currency support.
Xero requires a 30-day notice to cancel any subscription that has been purchased.
QuickBooks offers four different pricing tiers that provide different levels of service.
- For $5 per month, self-employed workers can track mileage and income, send invoices, and organize their expenses.
- For $10 per month, sending estimates and tracking sales tax is added, but tracking mileage is removed.
- For $24 per month, managing bills is added to the package, along with the ability to add multiple users.
- For $35 per month, you can track time, inventory and 1099 payments.
QuickBooks allows you to add an enhanced payroll option for $12 per month and $5 per employee. Full service payroll is available for $40 per month and $5 per employee.
For US customers, Xero offers payroll on standard and premium plans in several states, though electronic services are not available in most of them. This service includes free direct deposit and the ability to electronically file and pay Federal taxes. Users can manage their tasks, update accounts, approve leave, and track working hours for individual employees with simple menu interactions.
QuickBooks offers the same type of payroll services with their add-on products. Employees can be paid with free direct deposit and e-filing payroll and personal taxes is available.
For a payroll price comparison, Xero allows for up to 5 employees in the standard $30 per month plan for many consumers. QuickBooks would provide the same service for $47 per month, but without any restrictions to electronic services or geographic locations.
3. The Basics
Xero provides financial performance reports, app access, bank account connections, SSL encryption, 24/7 customer support and regular updates to their software package with every subscription. Users can create purchase orders via email, convert POs to bills or invoices, and be able to stay on top of their orders and costs.
QuickBooks provides access to mobile apps to make it easier to follow-up on invoices. Notifications of customer interactions can be sent to a mobile device. SSL bank integration allows users to track their finances in real time. 24/7 customer support is available and the product can be used in the browser or through a software download.
Neither provider requires new users to sign a contract.
4. Trying It
Xero offers new users the chance to try their accounting software with a 30-day free trial. The signup process requires only a small amount of personal information. You then can assign and unlimited number of users to your account and there is no credit card required to start using their accounting software.
QuickBooks also provides a 30-day free trial for their products without the need of providing a credit card as well. New subscribers may also be eligible to take advantage of a 60-day money-back guarantee on this platform. You are not required to provide a specific notice period for cancellation, but the current billing cycle will be billed up to the cancellation date.
Xero vs QuickBooks: Which is Better?
Xero offers users access to several payroll features at a price that is more affordable than QuickBooks. On the other hand, QuickBooks provides SMBs with a full suite of services that can help them take control over their finances in a simple and easy way.
For companies that have employees and internalized accounting, Xero may be an affordable alternative that helps you keep track of your data and metrics. For those who work independently as freelancers or sole proprietors, QuickBooks is a lower cost solution with equal features.
In the Xero vs QuickBooks debate, both provide adequate solutions. Choose the option that best meets your needs today.