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The right accounting software can greatly simplify a small business's finances. Here's how FreshBooks and Xero compare.
Check out The Best Accounting and Invoice-Generating Software for 2025 business.com recommends.
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 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 |
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Starting prices | $19 per month | $20 per month |
Invoicing |
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Customer service |
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Mobile app |
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Third-party integrations | More than 100 | Over 1,000 |
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.
The FreshBooks desktop and mobile apps are intuitive and easy to navigate. Source: FreshBooks
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’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
FreshBooks and Xero are well-regarded accounting solutions. Here’s how their pricing and essential accounting software features differ.
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 | |
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Lite | $19 per month plus $11 per team member per month |
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Plus | $33 per month plus $11 per team member per month | Everything in Lite, plus:
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Premium | $60 per month plus $11 per team member per month | Everything in Plus, plus:
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Select | Call for a quote; includes two team member accounts; $11 per month for additional team members | Everything in lower tiers, plus:
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Key pricing considerations for FreshBooks include the following:
Xero
Xero offers a simple pricing structure designed to support businesses at different stages of growth.
Plan | Price | Features |
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Early | $20 per month |
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Growing | $47 per month | Includes everything in Early, plus:
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Established | $80 per month | Includes everything in Growing, plus:
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Keep the following pricing considerations in mind when evaluating Xero:
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.
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:
FreshBooks lets you easily incorporate hours logged in your invoices. Source: FreshBooks
Xero
Xero has serviceable invoicing functions, including the following:
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.
FreshBooks
FreshBooks provides a variety of support options to meet your needs:
Xero
Xero’s customer support options are as follows:
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:
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:
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’s mobile accounting app allows you to handle finances while on the go. Source: Xero
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:
Xero
Xero offers seamless integration with over 1,000 third-party business applications, including these popular tools:
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 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.
Mike Berner contributed to this article.
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