Xero vs QuickBooks: Which Is the Best for Your Business?

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Xero and QuickBooks are powerful accounting software designed to streamline business finance management. Each tool offers unique features suitable for different businesses.

In this article, we’ll compare the two accounting software based on ease of use, pricing, customer support, key features, scalability, and customer reviews. By the end, you’ll have a clear insight into which is best for your business.

Xero
  • 30-day free trial
  • From $15/month/user
QuickBooks
  • 30-day free trial
  • From $15/month

Xero vs QuickBooks Compared

In this section, we’ve highlighted critical elements to compare Xero and QuickBooks, helping you determine which one best suits your needs.

Xero QuickBooks
Starting Price $15/month (75% off for the first six months) $15/month (50% off for the first three months)
Free Plan 30-day free trial 30-day free trial
Number of Users Supports unlimited user access across all plans 1 billable user in the starting price plan, 3 in the Essentials plan, 5 in the Plus plan, and 25 in the Advanced plan
Inventory Management Yes Yes
Budgeting Tools Yes Yes
Integrations Over 1,000 external integrations, including Xero Practice Manager, Zapier Over 750 apps, including Shopify, Gusto, etc. It also offers an in-house bookkeeping add-on
General HR Bill management, tax management, project tracking tools, time and expense tracking, recurring invoices, etc. Cash flow, receipt capture, inventory and tax management, mileage tracking, payroll, reporting, etc.
Customer Support 24/7 online support, support articles, phone Live chat, email, phone, community forums
Read Review Xero review QuickBooks review

Xero vs QuickBooks Pricing Compared

Winner: Xero

Pricing is a major factor when choosing financial software. Below is a table highlighting Xero and QuickBooks’ pricing information to help you evaluate which fits your budget.

Pricing Plans Xero QuickBooks
Free Version 30-day free trial 30-day free trial
Tier 1 $15/month – Early $30/month – Simple Start
Tier 2 $42/month – Growing $60/month – Essential
Tier 3 $78/month – Established $90/month – Plus
Tier 4 $200/month – Advanced

Both QuickBooks and Xero offer competitive price plans and 30-day free trials, allowing you to test the software and make informed decisions. However, Xero is a more cost-effective option than QuickBooks in terms of price value and its support for unlimited users. These major differences make Xero a better option for organizations with many team members than QuickBooks.

Comparing Xero and QuickBooks’ basic plan, QuickBooks’ Simple Start plan includes more features than Xero’s basic plan but only supports one user. Likewise, QuickBooks accounting and reporting features advance across each tier, making it a good option for small businesses with complex advanced needs and scalability.

For small to medium-sized businesses looking for robust functionality at a reasonable price, Xero is the clear winner. Its plans are particularly well-suited for businesses seeking a cost-effective solution without sacrificing basic accounting features.

Xero vs QuickBooks Ease of Use

Winner: Xero

Xero takes the lead when it comes to ease of use, beginning from its set-up. In fact, beginners of accounting software may easily navigate its interface owing to its intuitive designs. Its invoice creation process is seamless, with clearly labeled fields and options for customizing the layout. Its mobile app also presents a simple interface with ease of performing basic accounting tasks on the go without a steep learning curve.

Considering that QuickBooks includes advanced features, it’s no surprise that its usage imposes a learning curve for beginners. As a result, experienced users may prefer QuickBooks as its high level of automation may help them get more done with the software.

In terms of payroll processing, both QuickBooks and Xero provide an exciting, user-friendly experience, but with some differences. Xero provides strong automation of sales tax calculation and filings with clear audit trails. Its add-ons and integrations facilitate payroll processing efficiency and reduce errors.

Likewise, QuickBooks has robust payroll features available in tiers, including integrations with time-tracking and multiple tax filing options. However, advanced payroll features like payment file reports, and time tracking on the go require additional or advanced subscriptions.

In summary, Xero is the best choice for users who prefer simplicity. QuickBooks is the best choice for experienced users who want a robust accounting system with a slightly more advanced interface with payroll integration.

Xero vs QuickBooks Key Features

Winner: QuickBooks

Xero and QuickBooks are strong accounting software, depending on critical business needs. However, from the perspective of scalable accounting features and customization, QuickBooks takes the lead. Its flexibility with invoice customization to suit your business image and needs is top-notch.

Therefore, our comparison between Xero and QuickBooks will focus on invoicing, automation, expense tracking, and general accounting features to understand their strengths and weaknesses.

Invoicing
Many beginners are quickly drawn to Xero’s ease of use and simple interface, which makes generating professional invoices a breeze. However, when it comes to advanced invoicing, such as automatic late fees on recurring invoices, a high level of customization, and more, QuickBooks outshines.

With QuickBooks, you can generate unlimited invoices across all plans, whereas Xero only makes unlimited invoicing available on its two higher tiers. With QuickBooks’ invoicing feature, you can easily connect with your customers and send invoices through the QuickBooks Business Network directly to their account. Whenever you receive a payment, QuickBooks quickly matches payments to invoices automatically, saving you time. While the learning curve may be a concern for beginners, QuickBooks’ invoicing allows you to achieve more with automation.

Automation
Business activities become more intense as the days go by, making automation a necessity. So, if you need online accounting software to automate repetitive tasks, both Xero and QuickBooks have features to simplify your activities. We particularly love how Xero comes with pre-configured automations that require minor tweaks. This is good for beginners but imposes limitations on customization.

On the other hand, QuickBooks provides a high level of built-in automation that allows you to create custom workflows without the need for external tools. However, you may have to unlock the full potential of these features with QuickBooks higher-tiers.

Expense Tracking
In this expense tracking category, QuickBooks outshines Xero in pricing and feature advancement. Both Xero and QuickBooks offer expense tracking, which helps you understand your business spending.

Xero’s interface is intuitive, making it easy to enter expenses, capture receipts with its mobile app, and categorize them. However, expense tracking is only available with its higher-tier, Established plan.

We appreciate QuickBooks’ generosity in making expense tracking available from its basic plan. Also, you can automatically sort bank transactions into tax categories. QuickBooks’ customization allows you to create custom tags and organize expenses into up to 40 tag groups to see where you make and spend money.

General Accounting
QuickBooks dominates in this category with its comprehensive business financial reports and advanced workflow customization. Its high level of customization helps you get deeper insights into your unique business financial performance. Basic accounting features such as invoicing, tax management, payroll as an add-on, bill management, reporting, expense, and income tracking are available across all tiers, along with inventory and project profitability at higher tiers.

Xero also offers basic accounting features such as bills management, reporting, sales tax at all tiers, with expense tracking, inventory, and project profitability available at higher tiers. The most appealing aspect of Xero’s functionality is that it offers unlimited user access across all plans, making it ideal for enterprises with many stakeholders who need accounting access.

Xero vs QuickBooks Integrations

Winner: QuickBooks

Xero offers over 1,000 integrations across multiple industries, such as hospitality, manufacturing, accounting, retail health, etc. Each application is categorized into functions such as CRM, debtor tracking, inventory, payroll, etc.

Similarly, QuickBooks integrates with over 750 popular business apps to facilitate automatic data flow across business tools. In terms of figures, it’s obvious Xero offers more integrations than QuickBooks. However, QuickBooks stands out for the range and complexity of its integrations. It targets more sectors and has more precise categories than Xero.

Therefore, choosing the best between Xero and QuickBooks solely depends on your specific business needs. This is because both offer strong integration functionalities. With their free trials, you can be able to evaluate each software’s key integrations for your business and see which platform provides a smoother workflow.

Xero vs QuickBooks Scalability

Winner: QuickBooks

It’s common for your accounting needs to become complex as your business grows. Both Xero and QuickBooks can grow with your business, but it depends on your specific needs. Xero supports unlimited users, allowing for seamless collaboration across your teams without additional fees. Its intuitive interface may help team members learn its usage quickly. However, advanced features and high customization may be limitations in this case.

To address these limitations, QuickBooks is known for its advanced accounting and reporting features and high customization. Its advanced plan supports up to 25 users. QuickBooks’ multiple subscription plans cater to different business needs at various levels, allowing small businesses to enjoy its advanced accounting features.

QuickBooks scales well with large enterprises’ complex accounting needs. On the other hand, Xero’s limitation for advanced accounting makes it suitable for small businesses with basic accounting needs and growing team members.

Xero vs QuickBooks Customer Reviews

Xero’s customers are happy to express their satisfaction with the customer support, professionalism, and ease of usage. One of its users mentioned how Xero responded promptly and communicated professionally to resolve their queries.

I requested payroll support for some amendments I needed to make to an employee after testing some changes I couldn’t revert. I got a reply the same day in the afternoon from a very helpful payroll expert. I find that this side of the system is very well supported. The person who contacted me logged in and went through my query with me and it was resolved quickly. Very happy with the support received.

User review from Trustpilot

Likewise, one of QuickBooks users praised the ease of contacting customer service and highlighted their excellent helpfulness.

It was very easy to arrange a call back with one of the Quickbooks team who listened and solved my query incredibly quickly! Could not have asked for better service! Thank you

User review from Trustpilot

Both Xero and QuickBooks offer good experience in terms of customer support. However, several QuickBooks customers pointed out issues with customization and navigating the interface, because it required some knowledge to set up and use correctly. Advanced users with needs for a large number of integrations prefer QuickBooks, whereas beginners opt for Xero.

Conclusion – Xero vs QuickBooks: Which One Wins?

Xero QuickBooks
Price Winner
Ease of Use Winner
Features Winner
Integrations Winner
Scalability Winner
Customer Reviews Winner
Overall Winner

Xero tops with its affordability and ease of use, which makes it suitable for organizations that have a high number of accounting beginners. Setting up Xero is easy, and most of its automation is pre-configured.

QuickBooks’ extensive feature set shows that it is a comprehensive solution for businesses with complex accounting needs. This answers the learning curve that comes with its usage.

Overall, QuickBooks outmatches Xero in terms of features, integrations, scalability, and customer satisfaction.

Methodology

How We Review and Test Accounting Products

To provide our readers with accurate and well-informed recommendations, we test the most popular accounting products on the market to find the best options for you. Our methodology consists of the following criteria:

  • Features: We examine the features of each accounting software to determine what capabilities are offered- such as creating, editing, and deleting transactions.
  • Compliance: We evaluate accounting software based on whether it offers local compliance when it comes to payroll, taxes, documentation, and more.
  • Bank Reconciliation: We test the reconciliation process to ensure transactions match bank statements accurately.
  • Multi-Currency Support: We verify the accuracy of currency conversions and transactions in multi-currency environments.
  • User Experience: We get hands-on with each product and act as a new user, testing each platform to gain understanding if the platform is easy to use or not.
  • Reporting and Documentation: We verify the accuracy of financial reports generated by the software such as balance sheets and income statements.
  • Integrations: We evaluate the integrations of each piece of software to determine how well it fits in with other key pieces in a business’s software stack, and whether its functionality can be expanded as required.
  • Audit Trails: We ensure the software maintains comprehensive audit trails for tracking changes made to financial data.

How to Choose the Best Accounting Software

Choosing the best accounting software for your business goes beyond merely comparing prices and features. Below are critical elements to consider when choosing accounting software for your business.

BudgetEase of UseCompatibilityKey FeaturesScalabilityCustomer Support

Evaluate your business spending budget on accounting software to determine a software that meets your needs. It’s important to note that the total price will include the software subscription fee, number of users, and the fee for any add-ons you’d like to add to your account.

Understand how easy it is to use the software, as many accounting software require advanced accounting expertise for use. Understanding this will spare you from having to pay for further training or a large setup, which could strain your budget.

Ensure the accounting software you choose offers a mobile app and is compatible with your mobile device. This is because some software does not offer mobile apps or limit apps to certain operating systems. Accounting software with mobile apps enhances usability on the go and boosts productivity You should also ensure this mobile compatibility feature isn’t restricted to higher tiers.

Identify your business’s key features and map them to different accounting software available. Ensure that these features are available on your chosen plan, as some may be limited to higher-tier plans.

Consider the features that are crucial to your organization as it grows, and determine whether the software can scale with it. Make sure you understand both the cost of scaling and the software’s scaling capabilities.

Understand the available mode of contacting customer support and their working hours. Also, consider what other users say about the response time and the overall quality of customer support in their reviews.

FAQs

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John Iwuozor
Tech Writer
John Iwuozor
Tech Writer

John Iwuozor is a writer at Techopedia with over three years of experience and expertise covering topics on HR, business software, IT security, and finance for small and medium-sized businesses. His work has been featured on reputable platforms like Forbes Advisor and EsecurityPlanet. Leveraging his background in mathematics and data analysis, he specializes in delivering original and high-quality content with a keen eye for detail and accuracy.