FreshBooks vs. QuickBooks Online Comparison

QuickBooks hits the mark for most small businesses, but FreshBooks has enough basic tools for many freelancers.
Hillary Crawford
Kelsey Sheehy
By Kelsey Sheehy and  Hillary Crawford 
Edited by Christine Aebischer

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Deciding between FreshBooks and QuickBooks Online depends on how big your business is now and how big it will get. Freelancers and independent contractors may find all of the basic accounting functions they need with FreshBooks, and for a lower price point than QuickBooks Online, to boot.

But QuickBooks Online goes beyond basic accounting, with hundreds of app integrations, detailed inventory tracking in higher-tier plans and customizable reporting. Plus, it’s easy to scale and share with your accountant — all features you’d expect from the best accounting software for small businesses.

FreshBooks vs. QuickBooks Online at a glance

FreshBooks

QuickBooks Online

Key features

Has a strong invoicing feature; app lets users send invoices on the go, scan receipts and track mileage; basic inventory tracking for billable items; least expensive plan lacks double-entry accounting reports.

Has robust reporting tools and report customization options, invoicing for an unlimited amount of clients, inventory tracking in higher tier plans, plus a capable mobile app.

Ease of use

Auto-categorizes transactions for you, but you can’t set up your own bank rules; no global search function; least expensive plan lacks bank reconciliation tools.

Includes tools that help automate the reconciliation process, along with a global search function; however, there is a learning curve.

Scalability

Can support freelancers, contractors and small businesses with a handful of employees; highest-tier plan includes two users (additional users can be added for a fee).

Can support larger small businesses with dozens of employees; highest-tier plan includes 25 users.

Ease of sharing with accountants

Least expensive plan doesn’t allow accountant access; lacks complete audit trail.

Includes audit trails and easy accountant access; has millions of users so your accountant will likely be familiar with it.

Integrations

Integrates with more than 100 third-party apps; limited choices for direct payroll and point-of-sale integrations.

Integrates with more than 750 apps and offers live, in-house bookkeeping add-on.

Customer support

Includes phone support in all plans 8 a.m. to 8 p.m. ET from Monday to Friday; offers email support, but not live chat support with a human.

All plans include 24/7 live chat support; phone support is available 5 a.m. to 6 p.m. PST Monday through Friday, and 7 a.m. to 4 p.m. PST Saturday and Sunday.

Cost

Plans start at $15 per month.

Plans start at $30 per month.

Advanced features

Project tracking tools in higher-tier plans; lacks industry-specific reports and transaction tracking tags; users with multiple businesses must pay for separate subscriptions.

Includes project tracking tools in higher tier plans; has transaction tracking tags; lacks industry-specific reports; users with multiple businesses must pay for separate subscriptions.

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Why QuickBooks Online wins

Quickbooks Online

QuickBooks
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on QuickBooks' website

Scalability

QuickBooks Online has four subscription tiers that layer on reporting and bookkeeping functions to accommodate everyone from freelancers and service-based businesses to small companies with complex workflows and inventory management needs.

Upgraded QuickBooks Online plans also include multiple users, so you can share the workload with or among employees. FreshBooks, on the other hand, charges $10 per month per additional user and is better suited for contractors and freelancers.

Better feature set

While both software solutions offer features like time and mileage tracking, inventory management and reporting, QuickBooks Online’s capabilities typically exceed those of FreshBooks.

Reporting When it comes to reporting, QuickBooks Online lets you drill deeper with transaction tracking tags that you can use to separate results by job type or event, for example. The Plus and Advanced plans go a step further with class and location tags that you can use to see how different areas of your business are doing. And unlike FreshBooks, it includes double-entry accounting reports (like a general ledger and chart of accounts) in all plans.

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Inventory management If you manage a small amount of inventory and need basic tracking functions, FreshBooks can get the job done. QuickBooks Online goes beyond basic inventory tracking, with reorder points and the ability to purchase inventory directly from within the platform. You also can set pricing rules to customize rates, and run inventory reports to find out which products are your best sellers and which carry the highest cost. QuickBooks Online’s inventory features are available only in Plus and Advanced plans. FreshBooks, on the other hand, offers basic inventory tracking on all plans.

Accounting fundamentals FreshBooks lacks some basic accounting features, like bank reconciliation, in its Lite plan. You can upgrade to get these features, but you shouldn’t have to. And while the software will automatically match some transactions for you, it doesn’t let you create bank rules to further automate the categorization process. These functions are standard on the entry-level plan for QuickBooks Online and most other accounting software platforms.

Ease of sharing with accountants

FreshBooks’ least expensive Lite plan doesn’t allow for accountant access, which can be limiting for microbusinesses that want an accountant to look over their financials every so often. And regardless of plan tier, the software doesn’t provide audit trails, which help your accountant verify information and catch errors. Alternatively, QuickBooks Online includes accountant access in all plans. And thanks to the software’s popularity, most accountants should be familiar with it.

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When you might choose FreshBooks instead

FreshBooks Accounting

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on FreshBooks' website

Lower cost

QuickBooks is the more expensive option at all plan levels, and FreshBooks’ lower price tag may be the deciding factor for business owners looking for a simple, mobile-friendly bookkeeping solution. While QuickBooks does offer a more scaled-back product for freelancers and gig workers — QuickBooks Self-Employed starts at $15 per month — you can’t seamlessly grow into QuickBooks Online from this version.

Time tracking

Time tracking is easy and automatic with FreshBooks, and it's included with all plans. You can log in online to track your time or mark it via the mobile app, a browser extension or a third-party app like Asana. You also can record time by project and bill for tracked hours. QuickBooks offers time tracking through QuickBooks Time, but it costs extra. And you need to subscribe to the Essentials ($55 per month) plan or up to enter billable time.

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Alternatives

Xero

Pricing: $13 per month and up.

Xero, a popular alternative to QuickBooks Online and FreshBooks, has more than 3 million subscribers worldwide and allows unlimited users in every plan tier. It also integrates with more than 1,000 apps. While all of its plans include bank reconciliation (unlike FreshBooks), its lowest-tier Early plan doesn’t let users send more than 20 invoices, enter five bills or claim expenses.

Xero Accounting

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Wave

Pricing: Free.

Wave, a free accounting software product, offers unlimited invoicing, unlimited income and expense tracking, unlimited users and basic reporting. While it can’t necessarily support a quickly growing small-business, it’s a great solution for very small service-based businesses with a tight budget. The company also offers its own Wave Payroll solution — just keep in mind that it only handles payroll taxes in some states and isn’t free.

Methodology

NerdWallet’s accounting software ratings favor products that are easy to use, have a robust feature set and can grow with your business. Ratings are based on weighted averages of scores in several categories, including scope of features and integrations, customer support and cost, among others. Learn more about how we rate small-business accounting software.

These ratings are meant to provide clarity in the decision-making process, but what’s best for your business will depend on its size, growth trajectory and which features you need most. Simplicity doesn't always translate into ease of use. Less scalable products are typically simpler, but diminished functionality can cause headaches down the road for growing businesses. We encourage you to research and compare multiple accounting software products before choosing one.

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