Xero is also a well-established company, and it has grown rapidly since its launch in 2006 and offers a good Cloud accounts platform for small businesses. There are three different versions to choose from, Start, Standard and Plus. All three versions contain the same core features such as create and send invoices, track what you are owed, automatic bank reconciliation and calculate and submit VAT online. Typically, most accounting software systems have the core following features to help you manage your business finances. The lowest tier package is aimed at the small trader with a limited number of invoices, quotes, bills and bank transactions a user can process.

  • Sage seemingly offers unlimited quotes and invoices each month, while Xero limits you to just 20 on the base plan.
  • A good number will go out into research before making decisions.
  • Entering these bills is easy thanks to receipt capture with Hubdoc.
  • Keep in mind that these services charge a fee to process payments (usually around 2.9% plus 25 cents per transaction, though this varies by the payment processor).

Additional functionality includes recurring invoices, automated invoice reminders, bulk invoicing, and invoice replication. While it claims it has 24/7 online support, what it really means is that it has an online community you can ask questions in. If you need to speak with a person, you can only do so between 9 a.m. Xero, on the other hand, lets you customize your invoices with your own logo and text. You can also set automatic reminders so you don’t have to chase down your clients.

Final Verdict: Which Accounting Software is the Best?

So, if you collaborate with a high number of customers, Sage’s generous limits will be better for you. Sage’s unique cash-flow projection tool makes financial planning a whizz too. This, combined with its affordable monthly plans, make the software best suited to cost-conscious businesses that are able to get by without advanced accountancy functions. With some of the best accounting features we’ve reviewed and a wide range of useful integrations, our research suggests Xero is a better accounting software than FreshBooks and Sage.

Right off the bat, Sage Business Cloud Accounting is the more cost-effective option. Their intro package is a tad cheaper than Xero’s Starter package, and their mid-range package is significantly less than the Xero equivalent. Payroll is included for an extra £1.75 per month for each plan. Trustpilot feedback and reviews from customers are generally good, see the latest reviews and ratings. Prices do change, so please call us for the latest prices and costs. There are a number of optional extras such as Payroll that increases the price.

How Xero and Sage Stack Up

On the other hand, Sage Accounting links with 41 select apps via the Sage Marketplace. This selection includes known names like Zapier, Gusto, 9Spokes, CollBox, and Zynk Workflow. If that’s not enough, it connects with thousands more using Zapier and even offers APIs for custom needs. If there’s no direct feed, you can get a statement online and then import the details. Sage has a slight edge as it has nine invoice templates, and there’s no limit to the number of invoices you can send on either plan.

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It has the same features as the normal Sage software but comes with different pricing. Payroll is just one of the many other products Sage offers as well. For example, if you’re also looking for an HR management solution, Sage HR integrates seamlessly so you can manage your workforce.

Better business insights

But while FreshBooks integrations are stronger than Sage, they still pale in comparison to Xero’s. Sage offers better customer support options than Xero and FreshBooks, with live chat options available as well as a ‘Sage Univerity’ feature that gives users access to on-demand learning and instructor-led classes. We’re committed to making accurate verdicts at Tech.co, so when comparing accounting software our research team measures a number of metrics including ease of use, advanced features, and support tools. Jump to our methodology section to learn more about our thorough and independent research process. Just note that if you’re also looking for traditional accountancy services, you’ll need to pay for additional bolt-ons. Xero offers this service, but once again, only on its most expensive plan.

What is the difference between Xero and FreshBooks?

We’ve collected ratings from TrustRadius (TR) on both of these accounting software companies, so you can see for yourself how they stack up. Xero enables businesses to automatically update accounts to be HMRC compliant and submit financial information with a simple touch. Also, the ‘Xero Me’ mobile app enables employees to access their timesheets and pay slips, and enable owners to access detailed payroll reports and payroll history. Xero enables business owners to collaborate with financial advisors or accountants through cloud tools as financial figures can be shared across easily. Also, even if the business doesn’t have an accountant, Xero offers an extensive advisor directory.

Xero has a direct connection to HSBC, Natwest, RBS, Barclays and some Santander accounts, and can sync with others through a third party system called Yodlee. Sage 50 also offers bank feeds, but they’re all done through Yodlee, which requires more what is a trial balance report manual input from the user, so isn’t quite as streamlined in our opinion. The software offers easy integration with a large number of third-party apps and plugins enabling your to further enhance the features and functionality of the core system.