Advertiser Disclosure
X

Advertiser Disclosure: The credit card and banking offers that appear on this site are from credit card companies and banks from which MoneyCrashers.com receives compensation. This compensation may impact how and where products appear on this site, including, for example, the order in which they appear on category pages. MoneyCrashers.com does not include all banks, credit card companies or all available credit card offers, although best efforts are made to include a comprehensive list of offers regardless of compensation. Advertiser partners include American Express, Chase, U.S. Bank, and Barclaycard, among others.

  • Date

By

Dig Deeper

27,216FansLike
27,352FollowersFollow
43,398FollowersFollow

Become a Money Crasher!
Join our community.

Freshbooks vs. Quickbooks – Which Online Accounting Software Is Best?

QuickBooks and FreshBooks are among the best-known names in accounting software — both mainstays providing invoicing and payment tools and much more for freelancers, self-employed service providers, and small- and medium sized-business owners.

QuickBooks, owned by Intuit — the company behind TurboTax and Mint — has been the go-to accounting and bookkeeping software for decades. FreshBooks is a newer option, meeting the financial needs of online and home-based business owners and freelancers.

The companies’ names are so similar they might be easily conflated. But their services differ substantially and serve significantly different types of businesses. Review their features and pricing to determine which best meets your business needs.

Key Features

Which service is the best fit for your business depends on the types of accounting features you’re looking for. FreshBooks and QuickBooks share several basic features, but each service caters to a different type of business owner, so their advanced features differ quite a bit.

Invoicing

The key feature for many business owners looking for online accounting software is the ability to bill clients and get paid. This basic feature is at the core of both FreshBooks and QuickBooks, and what you get with either service is similar.

FreshBooks Invoicing

Quickly create invoices with a professional style, including your logo, custom colors, and a customized thank-you email for payments.

Create invoices by entering line items manually, or using time and expenses logged. Or set up recurring invoices for ongoing or subscription clients, which can include a set retainer price or automatically include unbilled time and expenses logged.

You can opt to accept payment online via these methods:

  • PayPal: Let clients pay via their PayPal account or credit or debit card. You pay normal PayPal transaction fees, which vary by country. For domestic payments in the U.S. and Canada, the fee is 2.9% + $0.30 per transaction.
  • Stripe: Accept credit or debit card payments, as well as direct deposit via ACH transfer (U.S. and Canada) or direct debit via BACS or SEPA (U.K. and Europe). Stripe automatically sends a payout to your bank account on a set schedule. Stripe fees are 1% for bank transfers and 2.9% + $0.30 per transaction for U.S.- and Canada-based card payments.
  • FreshBooks Payments: Powered by payments gateway WePay, this option lets U.S.-based businesses receive online payments via ACH transfer, or credit or debit card payments. WePay payments will automatically land in your bank account within one to three business days — as soon as the same day for Chase Bank account holders. Fees are 2.9% + $0.30 per card transaction or 3.5% + $0.30 for American Express payments, and 1% for bank transfers.

You can skip the fees by opting out of online payment and asking for payment via cash, check, or your client’s in-house bank transfer method.

Through an integration with small-business lender Fundbox, you can get an advance on unpaid invoices in FreshBooks to improve your cash flow. This option is available to qualifying FreshBooks users based in the U.S. with three to six months’ active invoicing history in the software. Your request is subject to approval, but Fundbox doesn’t run a credit check.

The Fundbox fee is based on the size of the loan, and you repay it with the loan over a 12- or 24-week period.

QuickBooks Invoicing

Create professional invoices and make them your own with your logo, brand colors, and customized emails. Create invoices manually, or use time logged for clients and projects. You can set up a recurring invoice to bill ongoing clients automatically.

QuickBooks invoices include a “pay now” button clients use to pay you using QuickBooks Payments via these methods:

  • ACH Transfer: Get money directly into your bank account from the client’s with direct deposit. You pay a 1% fee (max $10) per transaction.
  • Credit or Debit Card: Accept card payments from Mastercard, Visa, Discover Card, American Express, and Apple Pay. You pay 2.9% + $0.25 per transaction.

You can also let clients pay offline via cash, check, or their own direct deposit method, and you pay no fees.

QuickBooks Payments includes options for in-person payments, too, so you can take instant payments from clients for products or services you sell face-to-face. Use its free mobile card reader to swipe customers’ cards or key in card information manually. Fees are 2.4% + $0.25 for swiped cards and 3.4% + $0.25 for keyed cards.

Through an integration with Fundbox or FundThrough Invoice Financing, you can leverage unpaid QuickBooks invoices to get advance funding for your business.


Time Tracking and Expense Tracking

Whether you’re a solo freelancer or running a business with contractors of your own, you may need to track work hours to manage productivity and bill customers accurately. Both FreshBooks and QuickBooks offer industry-standard time-tracking features.

FreshBooks Time and Expense Tracking

Track your time, recording the client, project, task, and any necessary notes. FreshBooks lets you see a breakdown of how you spend your time so you can see how long projects take you and your team members to complete. You can also generate an invoice that automatically includes billable hours.

FreshBooks offers options to track time in any way and place that’s most convenient for you as you work, including:

  • Manually Log Time Spent. Enter any amount of time spent on projects and tasks.
  • Time Tracking in the App. Start a timer in the FreshBooks mobile app or in your account online, like punching the clock to track your work hours.
  • Chrome Time Tracker. Install the free FreshBooks Time Tracker Chrome extension to start the timer from your browser, no matter where you are online.
  • Project Management App Integrations. Add FreshBooks integrations to track your time inside apps you use for team collaboration, including Asana, Basecamp, Trello, and Teamwork.

You can track expenses and connect them to projects easily through these methods:

  • Connect Financial Accounts. Connect your business bank account and credit cards to FreshBooks to automatically import transactions.
  • Track Receipts. Snap a photo of a receipt with the mobile app to keep track of your expenses without a shoebox full of paper.
  • Mileage Tracking. Record driving in the app to track miles for tax deductions and expenses. You choose to allow mileage tracking only while you’re in the app — meaning you have to open the app to track a trip — or anytime so the app logs any trip you take, and you can review and categorize each as personal or business.
  • Recurring Expenses. Enter an expense and set it as recurring to keep track of regular costs with less bookkeeping.

QuickBooks Time and Expense Tracking

QuickBooks time tracking is set up for team management. Let employees clock in and out online, on a mobile device, or through the QuickBooks Time Kiosk — a program that runs on any computer or tablet and replaces the traditional punch clock for in-person work.

As a small-business owner, you can keep track of employees’ schedules and time sheets from within the QuickBooks Time app on mobile or desktop.

The Time app includes the option for GPS tracking, so you can keep track of and coordinate with employees while they’re on the clock. It also includes a geofencing option, which reminds employees to clock in or out at set locations.

To track business expenses, you can connect QuickBooks to your bank accounts, credit cards, PayPal, or Square for automatic tracking and categorizing. You can also take a photo of receipts when you’re on the go and have them saved and recorded in the mobile app.


Bookkeeping

No more crafting Excel spreadsheets to conquer your business’s finances and keep an eye on revenue and profitability. Both FreshBooks and QuickBooks offer features that track expenses and income and turn them into the reports you need to keep your business running.

FreshBooks Bookkeeping

FreshBooks Double-Entry Accounting identifies and connects revenue and expenses to help you track accurate profit and loss for projects. You can invite your accountant to view reports right in your FreshBooks account, so it’s easy to share information come tax time.

FreshBooks Accounts Payable lets you easily track your bills and payments to vendors throughout the year, run Profit-and-Loss (P&L) reports, and view cash flow statements to stay on top of your accounting.

QuickBooks Bookkeeping

With its revenue and expense tracking, QuickBooks includes built-in reports to help you keep track of your business finances throughout the year and at tax time.

Get cash flow insights and overviews of project costs, pull monthly P&L reports, generate balance sheets, and see expenses in tax-return-ready categories for the year. Allow accountant access to easily share information with your accountant for tax help or financial insights throughout the year.


Payroll

Whether you work with contractors, have a single employee, or employ a large team, payroll software helps you track and manage payments, taxes, and paperwork associated with running your business.

FreshBooks Payroll

FreshBooks doesn’t offer native payroll management, but it integrates with Gusto for payroll, W-2s, 1099s, and direct deposit. You have to manage payroll through Gusto, and the information is automatically imported into your FreshBook expenses.

QuickBooks Payroll

QuickBooks includes built-in payroll software to help you handle payroll, W-2s, 1099s, and direct deposit, as well as benefits including 401(k)s and health benefits.

QuickBooks Payroll can run automatically based on employees’ salaries or time sheets, so you don’t have to spend the time or money on data entry. It also calculates, files, and pays federal and state payroll taxes automatically to protect your business from a surprise tax bill.


Inventory Management

If you run a product-based business, the ability to track inventory and integrate it with your accounting software is a huge plus. A new addition to QuickBooks offers this option, while FreshBooks doesn’t offer it.

FreshBooks Inventory Management

FreshBooks doesn’t offer an inventory management solution.

QuickBooks Inventory Management

With QuickBooks Commerce, you can create listings, manage and fulfill orders, track inventory, and automate accounting across multiple e-commerce platforms, including:

  • Squarespace
  • WooCommerce
  • Amazon
  • eBay
  • Shopify
  • Etsy

The software helps product-based businesses keep listings up to date across platforms, so you don’t accidentally oversell or miss a price change.


Customization and Integrations

All software works best when it works well with other software so you can set up processes to fit your unique business needs. Both FreshBooks and QuickBooks integrate with hundreds of other software providers to help you seamlessly run your business.

FreshBooks Customizations and Integrations

Customize and expand the usefulness of your FreshBooks account by adding integrations with dozens of other business apps, including:

  • HubSpot. Connect your HubSpot account with FreshBooks to import closed-won leads as clients in your FreshBooks account and share payment information with HubSpot to evaluate the return on investment of your marketing strategies.
  • Zapier. Connect 750+ apps to automate all of your business processes through integration app Zapier. Examples include Slack notifications of payments, importing FreshBooks clients as contacts into a customer relationship management (CRM) tool like Salesforce, and importing MailChimp contacts as FreshBooks clients.
  • Gusto. Automatically track payroll as expenses in FreshBooks.
  • Fundbox. Get an advance on unpaid invoices.

FreshBooks connects with a variety of other apps, including Bench, Expensify, Harvest, Mailform, Shopify, RightSignature, Square, Toggl, and many others.

QuickBooks Customizations and Integrations

QuickBooks integrates directly with more than 650 popular business tools including:

  • Payments. Connect Amazon, PayPal, Square, Shopify, and other e-commerce platforms to automatically track income from selling products and services.
  • Accounting. Connect with popular apps for inventory management, time tracking, and financial reporting.
  • Customer Prospecting. Integrate CRMs, including Method:CRM and Housecall Pro.
  • Project Management. Use Buildertrend for a construction business and BigTime for consulting firms to manage projects across your teams.

QuickBooks also integrates with Zapier, which gives you access to an even larger suite of apps for business automation.


Customer Support

Both companies provide online resources and customer support, but FreshBooks is much more accessible.

FreshBooks Customer Support

FreshBooks provides an in-depth FAQ support section on its website to answer just about any question you have about using the software. For more small-business support, you can peruse its Resource Hub and Webinars.

For personalized support, you can ask a question to get an answer online via a FreshBooks chatbot or call customer support Monday through Friday 8am to 8pm Eastern time at 866-303-6061.

QuickBooks Customer Support

As part of a larger company, QuickBooks provides extensive support resources, but they’re complex and difficult to navigate across the brand’s suite of products and services. You can find answers to questions customers have asked plus a small selection of help articles in its Support hub.

You can get personalized help by asking questions of the QuickBooks expert community in its support forum or starting a real-time chat between 6am and 6pm Pacific time Monday through Friday. The company doesn’t provide a customer service phone number.

For bookkeeping help, you can work virtually with a live QuickBooks bookkeeper. They help with setup, then provide ongoing bookkeeping and reporting for your business.


Pricing

Both FreshBooks and QuickBooks offer tiered pricing that lets you choose the level of service you need for your business. QuickBooks tiers are based mainly around the features you need, while FreshBooks focuses on your number of billable clients.

FreshBooks Pricing

FreshBook offers plans to fit individuals and small- and medium sized-businesses.

FreshBooks plans include:

  • Lite Plan: $6 per month or $108 per year. Get up to five billable clients with unlimited invoices and expenses. Client emails will include FreshBooks branding.
  • Plus Plan: $10 per month or $180 per year, plus $10 per month per team member. Get up to 50 billable clients with unlimited invoices, expenses, and proposals. Gain access to recurring invoices, automatic expense tracking, accounting reports, bank reconciliation, and accountant sharing in your FreshBooks account.
  • Premium Plan: $20 per month or $360 per year, plus $10 per month per user. Get up to 500 billable clients with everything included in Plus, as well as custom and automated emails and accounts payable.
  • Select Plan: An enterprise account with custom pricing, a dedicated account manager, and lower credit card transaction fees.

QuickBooks Pricing

The QuickBooks suite of products also comes with fee and price structures for a variety of business needs.

QuickBooks Online plans include:

  • Self-Employed Plan: $15 per month. For freelancers, this plan lets you track income and expenses, invoice and get paid, estimate quarterly taxes, and run basic reports.
  • Simple Start Plan: $25 per month. New small businesses can track revenue and expenses, invoice and get paid, manage cash flow, send estimates, track sales and sales tax, and manage nonemployee contractors.
  • Plus Plan: $70 per month. Businesses with small teams can do everything included in Simple Start, plus manage and pay bills, time tracking for employees, and inventory tracking. The plan includes access for up to five managers.
  • Advanced Plan: $150 per month. Small and medium businesses get personalized account support, plus advanced business analytics, automated workflows, and up to 25 users.

All plans except Self-Employed include the option to add a setup session with a live bookkeeper for a one-time fee of $50.

When you sign up, you have the option to add Payroll to your plan for an additional monthly fee, or you can purchase and use Payroll independent of QuickBooks accounting software:

  • Payroll Core: $45 + $4 per employee per month. Access full-service payroll and benefits management for employees and contractors.
  • Payroll Premium: $75 + $8 per employee per month. Access extra features including same-day direct deposit, workers comp administration, and mobile time tracking with GPS and geofencing.
  • Payroll Elite: $125 + $12 per employee per month. Get personalized expert product support and a personal HR advisor along with your payroll features.

QuickBooks Commerce also comes with its own monthly fee — $150 per month, although new customers can pay just $20 per month for the first 12 months. You have to purchase a QuickBooks Online plan for accounting to use QuickBooks Commerce.


The Verdict: Should You Choose FreshBooks or QuickBooks?

On the surface, FreshBooks and QuickBooks seem to offer similar services: small-business accounting. Although many of their features are similar, they each appeal to a different kind of business owner.

You Should Use FreshBooks If…

FreshBooks is a better fit if:

  • You’re a Freelancer. FreshBooks’ pricing is much friendlier to solo business owners, independent contractors, and home-based businesses than QuickBooks’, and the simpler software gives freelancers just what they need without unnecessary complications.
  • You Run an Online Service-Based Business. FreshBooks’ pricing and features are a good fit for individual service providers or small agencies that work with contractors virtually to provide content creation or consulting services.
  • You Rarely Work with Employees. FreshBooks doesn’t offer a native payroll solution, so managing payroll and benefits with the software requires an integration that could get costly or complicated. It can, however, support simple payments and accounting for contractors.
  • Your Business Is New and Small. For new small businesses without complicated payroll or inventory needs, FreshBooks is a straightforward and affordable accounting solution.

You Should Use QuickBooks If…

QuickBooks is a better fit if:

  • You Run a Product-Based Business. QuickBooks Commerce helps you manage listings and inventory for e-commerce, and its in-person payment options make it easy for you to get paid when you sell products in person wherever you are.
  • You Run an In-Person Business with Employees. Whether you’re in retail, construction, or massage therapy, QuickBooks’ time tracking solutions help you manage employees in the store or in the field.
  • You’re a Growing or Medium-Sized Business. QuickBooks offers the level of support long-established small and medium businesses require, with more customization and scalable features.

Both Are Great If…

Both FreshBooks and QuickBooks are excellent options if…

  • You Want to Save Time on Bookkeeping. Using online bookkeeping and accounting software automates and integrates invoicing, payments, income tracking, expense tracking, time sheets, and financial reporting, so you can focus more of your time and resources on running your business.
  • You Want to Make It Easier to Get Paid. With a variety of online payment options built in, both FreshBooks and QuickBooks make it easy to collect payments from clients and customers without hassle for them or you.
  • You Want to Make Data-Driven Decisions About Your Business. Without a dedicated accountant, making heads or tails of the money coming in and going out of your business can be complicated, and you could leave money on the table. FreshBooks and QuickBooks include built-in reporting that shows you revenue, expenses, and profitability, so you can make better decisions.

Final Word

To meet a wide range of business styles and needs, accounting software comes with a wide variety of features and prices. Which is best for your business depends on what kind of work you do, where you work, who you work with, and how big your business is.

QuickBooks is an old hat in the accounting world. The software has been around since the 1980s when it was only available as desktop-based software. It’s grown and evolved over nearly four decades to accommodate the emerging needs of online businesses. But it continues to be the best software available for the traditional small and local businesses that were using it before online businesses emerged — product sellers, retail stores, construction, and consulting.

FreshBooks is a newer player in the space, launching in 2004, and responds to the need for a simpler and more affordable accounting solution for the growing pool of freelancers and micro businesses that sell services online. It cuts out the fat that serves brick-and-mortar shops and provides a pared-down, easy-to-use way for these small businesses and individuals to professionally manage their finances without becoming mired in spreadsheets.

Both are top options with their respective target audiences, but their audiences are significantly different. Consider your business needs, and review the features and costs of each to determine which is best for you.

Dana Sitar
Dana Sitar has been writing and editing since 2011, covering personal finance, careers and digital media. Say hi and follow her on Twitter @danasitar.

What Do You Want To Do
With Your Money?

Make
Money

Explore

Manage
Money

Explore

Save
Money

Explore

Borrow
Money

Explore

Protect
Money

Explore

Invest
Money

Explore