Cloud accounting software stores your financial data online via remote servers so that you can access it from anywhere with an internet connection. This makes it more accessible than traditional desktop-based accounting software, which typically requires specific operating systems and can only be used on a single computer.
Today, the best accounting software for small businesses tends to be cloud-based rather than desktop-based, meaning business owners don’t have to be tied to their office computers. You and any other authorized users can run reports, enter transactions, send invoices, reconcile accounts and monitor your business’s finances from any internet-enabled device. Many popular cloud accounting software products also offer mobile apps that let you do most of these tasks from your phone.
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Here are NerdWallet’s picks for the best cloud accounting software and how each stands out from the competition.
Best Cloud Accounting Software
Product | Promotion | Learn more | ||
|---|---|---|---|---|
QuickBooks Online Learn more on QuickBooks Online's secure website | 5.0/5 Best for Overall cloud accounting software | $30/month Additional pricing tiers (per month): $60, $90, $200. | 50% off for first three months or free 30-day trial. | Learn more on QuickBooks Online's secure website |
Xero Learn more on Xero's secure website | 5.0/5 Best for Business performance tracking | $15/month Additional pricing tiers (per month): $42, $78. | 30-day free trial or monthly discount (terms vary). | Learn more on Xero's secure website |
Zoho Books Learn more on Zoho Books' secure website | 4.5/5 Best for Scalability | $0 Additional pricing tiers (per month): $20, $50, $70, $150, $275. | 14-day free trial of the Premium plan. | Learn more on Zoho Books' secure website |
FreshBooks Learn more on FreshBooks' secure website | 4.5/5 Best for Freelancers and self-employed professionals | $19/month Additional pricing tiers (per month): $33, $60, custom. | 30-day free trial or monthly discount (terms vary). | Learn more on FreshBooks' secure website |
Wave Accounting | 3.5/5 Best for Free cloud accounting software | $0 Additional pricing tiers (per month): $16 | N/A | |
Odoo | 4.0/5 Best for Open-source cloud accounting software | $0 For use of a single app. Additional pricing tiers per user (per month): $38.90, $58.40. | Monthly discount for the first 12 months. |
Our pick for
Overall cloud accounting software
QuickBooks Online
Learn more
on QuickBooks Online's secure website
Starting at
$30/month
Additional pricing tiers (per month): $60, $90, $200.
Promotion
50% off
for first three months or free 30-day trial.
QuickBooks Online is an industry leader in the accounting field, thanks to its strong feature set, scalability and ability to accommodate small businesses with more complex financial needs. With millions of users worldwide, your accountant will likely be familiar with it.
Pros
- Easy to share information with your accountant and to find QuickBooks experts and online resources if needed.
- More than 750 app integrations, including live, in-house bookkeeping.
- Robust feature set includes thorough record-keeping, comprehensive reporting, excellent invoicing and inventory management, plus a capable mobile app.
- Daily phone support and 24/7 chat support in all plans.
Cons
- Expensive compared with the competition.
- Limited account users with each plan.
Our pick for
Business performance tracking
Xero
Learn more
on Xero's secure website
Starting at
$15/month
Additional pricing tiers (per month): $42, $78.
Promotion
30-day free trial
or monthly discount (terms vary).
Xero allows unlimited users at every subscription tier, a valuable feature for businesses where several users may need at least limited access to the system to run reports or analyze performance. Xero also has a customizable analytics dashboard that lets each user rearrange or hide panels.
Pros
- Unlimited users in all pricing plans.
- Integrates with more than 1,000 third-party apps.
- Feature set includes an excellent mobile app and suite of reports, capable invoicing features, plus automated bill and receipt capture through Hubdoc.
- Simple layout and easy to use.
Cons
- No phone number for customer support listed.
- Entry-level plan limits bills and invoices to five and 20 per month, respectively.
Our pick for
Scalability
Zoho Books
Learn more
on Zoho Books' secure website
Starting at
$0
Additional pricing tiers (per month): $20, $50, $70, $150, $275.
Promotion
14-day free trial
of the Premium plan.
Zoho Books packs an impressive collection of features and capabilities for an affordable price, and higher-tier plans let users automate workflows and track project profitability. It’s an especially good choice for users that already use the company’s other in-house apps and for businesses that want software with multilingual capabilities (Zoho Books supports 10 languages).
Pros
- Less expensive than some competitors; free plan available for businesses with less than $50k in annual revenue.
- Email support in free plan; phone and chat support in paid plans.
- Rich feature set includes excellent invoicing, inventory management, workflow rules and a capable mobile app.
- Add accounting widgets to your phone’s home screen; track time using your Apple Watch.
Cons
- Fewer third-party integrations and reports than some competitors.
- No plan includes more than 15 users (can add additional users for a fee).
Our pick for
Freelancers and self-employed professionals
FreshBooks
Learn more
on FreshBooks' secure website
Starting at
$19/month
Additional pricing tiers (per month): $33, $60, custom.
Promotion
30-day free trial
or monthly discount (terms vary).
FreshBooks is a simple and affordable option for freelancers and very small businesses that don’t require many users and prioritize being able to operate on the go via mobile app. It’s an especially inexpensive choice for those who can work within lower-tier plans’ billable client limits, and all plans include time tracking.
Pros
- Stay in touch with clients through the FreshBooks mobile app and get notified when invoices have been viewed or become overdue.
- Intuitive, customizable invoicing capabilities compete with those of more robust accounting solutions.
- Track time and add billable hours to invoices in all plans.
- Weekday phone support in all plans.
Cons
- Lacks features that quickly growing companies need, like audit trails for accountants to review.
- Highest-tier Select plan only comes with two users (additional users add $11 per month) and lower-tier plans put limits on billable clients.
- Least expensive plan lacks double-entry accounting reports, bank reconciliation and accountant access.
Our pick for
Free cloud accounting software
Wave Accounting
Starting at
$0
Additional pricing tiers (per month): $16
Promotion
N/A
Unlike some “freemium” software products, Wave doesn’t put out a bare-bones free product as bait, then load it down with costly upgrades. The free accounting software lets you add unlimited collaborators, along with unlimited bank and credit card connections. It can be a simple solution for small, service-based businesses.
Pros
- Free plan available.
- Intuitive, customizable invoicing capabilities compete with those of more robust accounting solutions.
Cons
- Lacks features that quickly growing companies need, like audit trails.
- Must subscribe to Wave’s Pro plan or other paid services (payroll, payments, advisor, etc.) to receive customer support from a human.
- No third-party integrations, mileage tracking feature or ability to accept in-person card payments.
Our pick for
Open-source cloud accounting software
Odoo
4.0
NerdWallet rating Starting at
$0
For use of a single app. Additional pricing tiers per user (per month): $38.90, $58.40.
Promotion
Monthly discount
for the first 12 months.
If you just want to use Odoo’s accounting app alone, you and an unlimited number of users can do so for free. If, however, you have need for any of Odoo’s dozens of other open-source business apps (for inventory, sales, marketing, manufacturing, HR and more), then you can choose a paid plan to open your access to the full library of apps that integrate seamlessly.
Pros
- Unlimited users.
- Vast library of directly integrated apps means the software can grow with your business.
- Open-source model encourages regular testing and improvement of the software.
Cons
- Paid plan is required to access the full list of features for most apps and any additional apps.
- Phone support is only available for database emergencies.
QuickBooks Online
Best overall cloud accounting software
Price:
- $30 per month for the Simple Start plan.
- $60 per month for the Essentials plan.
- $90 per month for the Plus plan.
- $200 per month for the Advanced plan.
Why we like it: QuickBooks Online has robust reporting and transaction tracking tools, invoicing capabilities, inventory management features and mobile app functionality. In particular, entrepreneurs trying to measure performance in different segments of their business will like QuickBooks Online’s granular transaction tracking tools that let you group transactions by project or location, among other categories. Reporting capabilities increase with each plan, but even the least expensive Simple Start plan includes more than 50 reports. These features, along with QuickBooks Online’s ability to scale up and integrate with a wide range of products, make it valuable to self-employed entrepreneurs and larger small businesses alike. And with millions of users worldwide, your accountant will likely be familiar with it.
The software’s biggest downside is its cost. You have to subscribe to the Plus plan or up to record billable expenses, access inventory tracking features and track employee time. Make sure to factor this into your budget if any of these features are on your must-have list. Read our complete QuickBooks Online review.
Xero
Best for business performance tracking
Price:
- $15 per month for the Early plan.
- $42 per month for the Growing plan.
- $78 per month for the Established plan.
Why we like it: Xero offers a long list of features at a competitive price point. In particular, it has excellent reporting features and a customizable dashboard that lets each user rearrange or hide panels according to their preferences. The dashboard has a clean and simple interface that makes it easy to track business performance and glean valuable insight to make data-backed decisions.
Xero also stands out among much of the competition for allowing unlimited users at every subscription tier, a valuable feature in situations where several users need some level of access to the system. Additionally, it offers a full catalog of third-party apps and software integrations. Read our full Xero Accounting review.
Zoho Books
Best for scalability
Price:
- $0 per month for the Free plan.
- $20 per month for the Standard plan.
- $50 per month for the Professional plan.
- $70 per month for the Premium plan.
- $150 per month for the Elite plan.
- $275 per month for the Ultimate plan.
Why we like it: Unlike some competitors, Zoho Books doesn’t put a limit on billable clients, and even its free plan lets you send up to 1,000 invoices per year. The free option also offers a customer portal, automatic payment reminders, mileage tracking and the ability to schedule reports. Zoho Books offers five additional plan tiers ranging in price and functionality. For this reason, Zoho’s cloud accounting software is a strong choice for startups and businesses that are planning for rapid growth. And because Zoho has an entire suite of products (like Zoho CRM, Zoho Inventory and Zoho Commerce), you will likely find most of the software capabilities your business needs as it expands.
The software also offers some useful mobile features — such as the ability to send invoices by iMessage or add widgets to your phone’s home screen to easily access timers and overdue invoices. There’s also an Apple Watch app that lets you track time, send payment reminders and review outstanding invoices. Read our Zoho Books review.
FreshBooks
Best for freelancers and self-employed professionals
Price:
- $19 per month for the Lite plan.
- $33 per month for the Plus plan.
- $60 per month for the Premium plan.
- Custom pricing for the Select plan.
Why we like it: FreshBooks is especially useful for freelancers because it lets users view and send invoices, respond to clients’ questions and track mileage and expenses, all from its mobile app. Clients can also choose to create their own accounts. This lets them save and comment on invoices, save their payment information, invite others to access the account and collaborate on projects they’ve been invited to view.
Unlike some competitors that require you to pay extra for a time-tracking module, all FreshBooks plans come with unlimited time tracking. You can start a timer from within the mobile app to log hours spent on a particular project, or sync data from tools like Asana or Trello.
FreshBooks is especially cost-effective for freelancers who can work within the confines of the billable client limits within lower plan tiers. Plans that allow for unlimited billable clients start at $55 per month. Read our full FreshBooks review.
Wave Accounting
Best free cloud accounting software
Price: $0.
Why we like it: Wave can be a sufficient solution for entrepreneurs with small, service-based businesses who need a simple way to invoice clients and separate business and personal expenses. You can create and send invoices as well as set up recurring invoices and track client communication and payment history. The software also offers different invoice templates depending on the type of business you run: consulting, freelance, legal services, marketing or professional services. Read our Wave Accounting review.
Odoo
Best open-source cloud accounting software
Price:
- $0 per month for use of a single app.
- $38.90 per user per month for access to all apps.
- $58.40 per user per month for access to all apps across multiple companies plus Odoo’s external API.
Why we like it: If you’re interested in the benefits of open-source software — including customizability, faster time to market on new and improved products and a large community of users and developers to turn to for software support — then Odoo may be a great solution for your business. It offers affordable pricing plans, including a free plan that allows you and an unlimited number of users access to one app (for example, accounting) at no cost.
Odoo’s accounting software handles invoicing, billing and automated bank reconciliation — all within a clear, user-friendly interface that’s easy to update in real time. You’re also able to access features and reports, such as your chart of accounts, tax forms, audit files and more, that are pre-configured to the specific requirements of your business location.
If the open-source model appeals to you but you don’t have a developer on your team or coding experience yourself, Odoo offers a variety of training and implementation packages, based on the size of your business and the complexity of your software needs. And because Odoo is a collection of software applications designed and developed to work seamlessly with another, you will have great flexibility and customizability available to build the business software solution you need.
Cloud accounting is the process of recording your business’s financial data, translating it into useful insights and storing it online so that it can be accessed remotely. You sign into the remotely hosted software via a browser or mobile app to perform accounting tasks, like recording financial transactions, categorizing them, reconciling accounts, sending invoices and running reports. Cloud accounting software helps streamline those processes and centralizes all of the resulting information online.
Most businesses will benefit from the flexibility of cloud accounting software versus locally installed, desktop-based accounting software. Small-business owners can enter sales and run reports remotely, as opposed to having to go into an office. Similarly, freelancers can send invoices from their phones and accept payments on the go.
Regardless of what type of business you run, cloud accounting software makes it easier to collaborate with other users, including your accountant. They can access the software remotely, you don’t have to manually import their changes and some products even enable you and your accountant to work within the software simultaneously. Separately, your accounting software won’t take up space on your hard drive, since all of the data is stored in the cloud and you don’t have to install anything.
Unless there’s a specific reason you prefer desktop-based accounting software, going with a cloud-based product is usually more convenient and can be less expensive than desktop-based accounting software, especially if you need to provide access to multiple users.
Cloud accounting software companies encrypt your business’s financial data, which makes it unreadable to outsiders, and require passwords to access it. Firewalls also help guard servers against hackers. Most companies have web pages that address security concerns and explain what specific measures are being taken to protect your data.
It’s not without its risks, but neither is desktop-based accounting software. Your locally installed data is still vulnerable to hackers and malware, and if your computer gets damaged or is stolen, you may lose the data stored on it. Data stored online isn’t as vulnerable to physical damage, and well-established software companies should have the resources to implement strong online security policies.
Last updated on April 5, 2024
Methodology
NerdWallet independently reviews accounting software products before determining our top picks. We collect the data for our software ratings from products’ public-facing websites and from company representatives. Information is gathered on a regular basis and reviewed by our editorial team for consistency and accuracy.
NerdWallet’s accounting software ratings favor products that are easy to use, reasonably priced, have a robust feature set and can grow with your business. The best accounting software received top marks when evaluated across 10 categories and more than 30 subcategories. 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. We encourage you to research and compare multiple accounting software products before choosing one.
NerdWallet does not receive compensation for any reviews. Read our editorial guidelines.
Frequently Asked Questions
Rather than storing your financial data locally on a hard drive, cloud accounting software backs your information up to the cloud (the internet, essentially) and lets you access it from any device with an internet connection. Typically, you use your email and password to sign in online or through a designated app.
Cloud accounting software isn’t limited to just one computer, and you don’t have to buy additional user licenses to use it on multiple devices. Often, this makes it more cost effective and convenient than desktop-based accounting software. Other benefits include cloud-based accounting features, like online bank feeds that automatically import new transactions from your connected bank accounts. Plus, you don’t risk losing all of your data if your computer’s hard drive fails.
The best cloud accounting software depends on your business’s size and financial needs. Here are a few tips for navigating the decision-making process:
- Consider how much your business may grow, and narrow down your options to software that can accommodate your operations now and down the road.
- Check in with your accountant to see if they’re familiar with the software and can work with it.
- Make sure the program integrates with your other software products for payroll or point-of-sale.
