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FreshBooks vs. Xero Comparison

The right accounting software can greatly simplify a small business's finances. Here's how FreshBooks and Xero compare.

Tom Anziano headshot
Written by: Tom Anziano, Senior WriterUpdated Jan 14, 2025
Shari Weiss,Senior Editor
Business.com earns commissions from some listed providers. Editorial Guidelines.
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Editor's Rating9.1/10
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Are you a newly minted independent contractor, a quickly growing small business or an established company? Whatever the case may be, you must manage your books, stay on top of invoicing and expenses, and perform myriad financial tracking tasks. Fortunately, the best accounting and invoicing software streamlines all these functions and more. FreshBooks and Xero are well-regarded accounting software platforms with essential features and functionality to help you run your business. We’ve conducted an in-depth analysis of both platforms to compare their features and pricing and help you choose the right accounting software for your business.

FreshBooks vs. Xero

FreshBooks vs. Xero Highlights

FreshBooks and Xero are both excellent platforms for financial management, invoicing and managing cash flow. However, depending on your unique needs, one may be a better solution than the other. Here’s an overview of how they compare.

Criteria

FreshBooks

Xero

Starting prices 

$19 per month

$20 per month

Invoicing

  • Unlimited invoices (depending on plan)
  • Customized invoices
  • Automated recurring invoices
  • Checkout links
  • Payment reminders
  • Deposit and payment acceptance
  • Invoicing and quoting
  • Personalized invoices
  • Payment acceptance
  • Recurring invoices
  • Payment reminders
  • Discounts and credit limits

Customer service

  • Phone support: Monday to Friday, 8 a.m. to 7 p.m. ET
  • Online help center
  • 24/7 chatbot support
  • Xero Central online resources
  • 24/7 support after filing a support request (may include a phone call)

Mobile app

  • iOS and Android
  • Invoicing features
  • Customer messaging
  • Mileage and time tracking
  • Automatic expense receipt scanning
  • iOS and Android
  • Invoicing features
  • View all account information
  • Account reconciliation
  • Document scanning
  • Receipt uploading

Third-party integrations

More than 100

Over 1,000

Who Is FreshBooks For?

FreshBooks is an ideal accounting solution for small businesses, freelancers and independent contractors. In addition to standard double-entry accounting and reporting functions, FreshBooks specializes in streamlined invoice generation. Want to get paid on the go by converting an estimate or billable hours into an invoice? FreshBooks is a particularly appealing option for service-based businesses. Our detailed review of FreshBooks explains more about this platform’s robust features.

Freshbooks desktop and mobile apps

The FreshBooks desktop and mobile apps are intuitive and easy to navigate. Source: FreshBooks

Who Is Xero For?

Xero is an excellent option for business owners new to accounting concepts and organizations that want straightforward financial information. This highly regarded accounting platform offers robust double-entry accounting and reporting features; at the same time, it emphasizes ease of use and simplifying accounting concepts. We like that its tiered pricing model supports feature expansion, making it a great choice for growing businesses. Check out our comprehensive review of Xero accounting software for a more detailed overview.

Xero interface

Xero’s interface is free of accounting jargon; it uses color-coded graphs to present your financial information in a clear and organized way. Source: Xero

TipBottom line
Whether you're a freelancer running a small operation or a fast-growing business, having a solid understanding of general ledger accounting is vital.

FreshBooks vs. Xero Comparison

FreshBooks and Xero are well-regarded accounting solutions. Here’s how their pricing and essential accounting software features differ.

Pricing and Plans

Your accounting software must fit into your budget planning and make sense for your team’s needs.

FreshBooks

Here’s an overview of the simple and flexible service plans FreshBooks offers. Note that we’re showing monthly pricing; you’ll receive a 10 percent discount if you pay annually.

Plan

Price

Features

Lite

$19 per month plus $11 per team member per month

  • Five billable clients
  • Unlimited time tracking
  • Unlimited expense tracking
  • Unlimited estimates
  • Checkout links
  • Recurring invoices
  • Payment reminders and late fees
  • Mobile app
  • Tax time and business health reports

Plus

$33 per month plus $11 per team member per month

Everything in Lite, plus:

  • 50 billable clients
  • E-signature acceptance
  • Unlimited proposals
  • Client retainers
  • Financial and accounting reports, including double-entry accounting reports
  • Ability to “invite your accountant”

Premium

$60 per month plus $11 per team member per month

Everything in Plus, plus:

  • Unlimited clients
  • Additional reporting capabilities
  • Receipt and bill scanning
  • Project profitability tracking
  • Email template customization

Select

Call for a quote; includes two team member accounts; $11 per month for additional team members

Everything in lower tiers, plus:

  • Simplified data migration
  • Lower transaction fees
  • No FreshBooks branding
  • Select support
  • Secure card storage
  • Customized onboarding

Key pricing considerations for FreshBooks include the following:

  • Introductory offers: FreshBooks often provides substantial online discounts for new users to attract new customers.
  • Free trial: New customers can test the platform with a 30-day free trial.
  • Payroll add-on: FreshBooks Payroll is available for an additional $40 per month plus $6 per employee per month.
  • Payment processing fees:
    • To accept credit card payments online through FreshBooks Payments (powered by Stripe), the standard fee is 2.9 percent plus 30 cents per transaction. There are slightly higher fees for American Express.
    • FreshBooks Advanced Payments ($20 per month) enables businesses to accept credit card payments over the phone or in person. This service also allows for client card storage and recurring billing, with fees of 3.5 percent plus 30 cents per transaction.

Xero

Xero offers a simple pricing structure designed to support businesses at different stages of growth.

Plan

Price

Features

Early

$20 per month

  • 20 invoices and five bills per month
  • Basic analytics
  • Tax assistance
  • Bank transaction reconciliation
  • Access to Hubdoc for bill and receipt capture
  • Sales tax support

Growing

$47 per month

Includes everything in Early, plus:

  • Unlimited invoices and bills
  • Optional Inventory Plus add-on

Established

$80 per month

Includes everything in Growing, plus:

  • Advanced analytics
  • Expense tracking
  • Project management
  • Multiple currency support

Keep the following pricing considerations in mind when evaluating Xero:

  • Introductory offer: Like FreshBooks, Xero often runs heavily discounted specials online for new users.
  • Free trial: Xero’s 30-day free trial is an excellent way to test the platform.
  • Payroll: Xero works with Gusto, one of the best online payroll services, to offer payroll functionality to its clients. Prices start at $40 per month plus $6 per employee. Our review of Gusto payroll has additional pricing details.
  • Payment processing: Xero works with Stripe for payment processing. For most online transactions, you’ll pay 2.9 percent plus 30 cents.
  • No user restrictions: Xero doesn’t limit a business’s users, which can save money.
Best for Pricing
Tie

There's no clear winner when comparing FreshBooks and Xero for pricing. Your choice will depend on the features you prioritize and your business's specific needs. FreshBooks is likely the most affordable option for businesses that send frequent invoices but don't have multiple users. It's also a strong choice for expense tracking, as this feature is included in all plans. In contrast, Xero restricts this feature to the highest-tier plan. We also appreciate that FreshBooks has slightly more affordable plans and offers a custom plan.

Still, Xero allows unlimited users, making it a better fit for growing businesses that frequently add new employees. In contrast, FreshBooks charges $11 monthly for each user. Xero also offers more bang for your buck if you need more robust accounting features without paying for a premium plan.

Did You Know?Did you know
Most businesses, including self-employed individuals, must make quarterly estimated tax payments. Accounting software can help you stay on top of quarterly taxes and everything else your business needs to know about accounting.

Invoicing

Strong invoicing features are essential for maintaining a steady cash flow in small businesses.

FreshBooks

With an emphasis on creating professional invoices, FreshBooks stands out from the competition. Here are some notable invoicing features:

  • Personalization: FreshBooks makes customizing your invoices to match your branding effortless. We were impressed by how easy it is to design and polish invoices with the platform’s tools.
  • Billable time tracking: With FreshBooks, you can track billable hours and quickly add them to your invoices. This practice makes billing more straightforward and accurate.
  • On-site billing: We appreciate that FreshBooks lets you invoice and accept payments right from the job site. So, there’s no need for separate time-tracking or attendance tools.
  • Converting estimates and proposals: Turning estimates or proposals into invoices is straightforward. This simplicity makes FreshBooks an excellent choice for contractors who need to close sales quickly.
  • Built-in payment processing: We really like that FreshBooks has an in-house payment system that simplifies the payment process. Customers can easily click a link in their email invoice to securely enter payment details.
  • Advanced invoicing features: Recurring invoices, payment reminders, and options to charge interest and late fees on unpaid invoices help ensure you get paid on time.
Freshbooks hours logged

FreshBooks lets you easily incorporate hours logged in your invoices. Source: FreshBooks

Xero

Xero has serviceable invoicing functions, including the following:

  • Invoice customization: We like that Xero provides tools to customize the look and feel of your invoices. However, its design suite isn’t as user-friendly and intuitive as FreshBooks’.
  • Converting quotes to invoices: We appreciate that Xero lets you convert quotes to invoices on the spot. However, it’s worth noting that time and expense tracking aren’t included in all plans, which could be a limitation for some businesses.
  • Payment acceptance: We were impressed that you can sync Xero with some of the best credit card processors, including PayPal, Stripe and Square. This feature allows you to securely accept payments online after emailing invoices to clients.
  • Mobile invoicing: The Xero mobile app lets you create and send invoices while on the go. This feature makes it particularly useful for businesses that need to collect payments in the field.
Best for Invoicing
FreshBooks

FreshBooks wins decisively over Xero when it comes to invoicing capabilities. Its design suite offers more customization options and is significantly easier to use compared to Xero. Xero also lacks the seamless integration with time tracking that FreshBooks offers. Additionally, FreshBooks allows you to use its in-house payments system to accept credit cards directly from invoices. Conversely, Xero only allows you to sync with third-party payment apps.

Notably, FreshBooks' entry-level plan lets you send unlimited invoices to up to five clients. Xero, on the other hand, caps you at 20 invoices per month on its lowest-tier plan.

Customer Support

FreshBooks

FreshBooks provides a variety of support options to meet your needs:

  • Availability: Customers can access email, live chat and phone support Monday through Friday, 8 a.m. to 7 p.m. ET. Support is available through your customer account.
  • Chatbot assistance: FreshBooks includes a 24/7 automated chatbot, FreshBot, for handling basic questions. However, its functionality is limited to simpler inquiries.
  • Online resources: We like that the FreshBooks website shares webinars, blog posts and e-books to help users make the most of the platform.
  • Advanced support: Select plan users receive dedicated support and personalized onboarding to ensure a smooth transition.
  • Trustpilot rating: FreshBooks scored 2.4 out of 5 on Trustpilot, with 57 percent of users rating it five stars.

Xero

Xero’s customer support options are as follows:

  • Availability: Customers can request assistance online 24/7 via a support request. After submitting a request, a Xero rep will reach out via phone or email within two hours. There’s no option to call customer service directly.
  • Online resources: Xero’s online resource, Xero Central, has a nice array of videos, blog posts and other educational materials. These aim to help users navigate the software. The company recommends users start there before requesting assistance.
  • Trustpilot rating: Xero garnered a 3.7 out of 5 on Trustpilot.
Best for Customer Support
FreshBooks
We found the FreshBooks support options more helpful than Xero's. While Xero claims to offer 24/7 support, users can't actually get immediate assistance. They must submit a request and wait for a call or email. FreshBooks only offers live support during limited hours, but you'll be able to talk to a support rep on the phone or via live chat right away.

Mobile App

A top-notch mobile app is essential for helping business owners and accounting professionals handle finances while on the go.

FreshBooks

We were impressed that the FreshBooks mobile app is rated 4.7 out of 5 on the Apple App Store and 4.5 on the Google Play Store. It includes the following features:

  • iOS and Android versions
  • Time tracking
  • Instant invoicing
  • Receipt capture
  • Invoice status tracking
  • Customer messaging system

Xero

The Xero Accounting app is rated 4.6 out of 5 on the Apple App Store and 4.4 on the Google Play Store. Its features include the following:

  • iOS and Android versions
  • Bank transaction reconciliation
  • Invoice creation and management
  • Cash flow monitoring
  • Automatic expense recording
  • Supplier and customer data management
  • Customer and vendor contact management

We like that Xero also offers two standalone apps: Xero Me, for employees to track expenses, time, and leave, and Xero Projects, for managing specific projects. However, depending on your plan, you may need to add these services.

Xero mobile app

Xero’s mobile accounting app allows you to handle finances while on the go. Source: Xero

Best Mobile App
Xero
Xero's mobile app includes many more accounting-specific features compared to the FreshBooks app. This alone makes it the overall winner if you want to run your business from a smartphone. Still, the FreshBooks app outshines Xero when it comes to invoicing-specific features.
FYIDid you know
To optimize your finances, prepare for tax season and avoid fraud, you should reconcile your business bank account. While FreshBooks and Xero offer bank reconciliation on most plans, Xero even lets you perform this crucial task on the mobile app.

Third-Party Integrations

Integrations help you expand your software’s functionality and allow your systems to communicate smoothly.

FreshBooks

FreshBooks integrates with more than 100 third-party business applications, including the following well-known brands:

  • BigCommerce
  • Zoom
  • WooCommerce
  • Zendesk
  • Expensify
  • WordPress
  • Constant Contact
  • Slack
  • Dropbox
  • Microsoft Outlook
  • Gusto
  • Zapier

Xero

Xero offers seamless integration with over 1,000 third-party business applications, including these popular tools:

  • Square
  • Stripe
  • PayPal
  • Gusto
  • Cin7 Core (formerly DEAR Inventory)
  • Expensify
  • Rippling
  • Zapier
  • HubSpot
Best Third-Party Integrations
Xero
Xero's extensive selection of third-party integrations puts it well ahead of FreshBooks and many other accounting software platforms we've reviewed. While some overlap exists between the apps they support, each platform also offers unique syncing options. We were impressed by Xero's wide range of integrations, including industry-specific apps. However, it's worth noting that some options, such as Zendesk's CRM, are exclusive to FreshBooks. We recommend reviewing each platform's app store to ensure compatibility with the business tools you rely on.
TipBottom line
If you're exploring CRM solutions, check out our comprehensive reviews of the best CRM software and our detailed review of Zendesk.

FreshBooks vs. Xero Summary

FreshBooks is best for businesses that need robust invoicing functionality.

FreshBooks is an excellent option for businesses that need excellent, straightforward invoicing functionality. Service-based businesses and independent contractors will find this platform highly beneficial — particularly those who perform significant on-site work and regularly send invoices. This platform’s invoicing capabilities impressed us; they’re among the best of all the accounting software applications we’ve reviewed. You can easily convert billable hours or estimates into invoices, customize them to reflect your branding, and accept payments through its built-in payment system. However, keep in mind that FreshBooks limits the number of users on all plans unless you pay an additional fee. For this reason, it’s best suited for small businesses with a single person managing accounting and invoicing tasks.

Xero is best for growing businesses.

Xero is an excellent choice for growing businesses — whether online or brick-and-mortar. This honor is in thanks to its pricing plans that allow unlimited users without additional fees. As your company grows and your accounting requirements become more complex, Xero enables you to add team members seamlessly without increasing costs. We were particularly impressed by Xero’s mobile app, which lets you do more on the go. Plus, it boasts a wide array of integrations. So, no matter what business software solutions you might need in the future, you’ll most likely be able to use them with Xero.

FAQs

Both FreshBooks and Xero are top accounting software choices. FreshBooks is better at invoicing and great for the self-employed and small businesses. Xero allows unlimited users and has more integrations, making it a better choice for larger and growing businesses.
Yes. However, you must subscribe to the FreshBooks Plus plan for this functionality. In contrast, Xero allows you to add users, including your accountant, for free.
Hubdoc is included with all Xero plans. It allows you to capture, extract and store data from documents scanned using your smartphone.
Yes. Both FreshBooks and Xero are cloud-based applications. The biggest benefit of cloud-based apps is that you don't need to install a desktop version of the software.
Yes. While Xero is based in New Zealand, it is used worldwide. Also, it’s one of the top accounting software solutions in the U.S.

Mike Berner contributed to this article.

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Tom Anziano headshot
Written by: Tom Anziano, Senior Writer
Tom Anziano is an international business expert with a bachelor of business administration from the University of Miami, where he concentrated on marketing. Over the last two decades, he has shared his expertise domestically and abroad, including as a business skills and writing teacher in Madrid. At business.com, Anziano primarily covers marketing topics, including social media trends, marketing analysis, and email and text message marketing. Anziano also has experience testing business software and services, allowing him to make informed recommendations on the best products and tools for business owners. He specializes in CRM software, email and text message marketing platforms, and financial solutions.
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Looking for more options?

Check out The Best Accounting and Invoice-Generating Software for 2025 business.com recommends.

Editor's Rating9.1/10
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