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Best Accounting Software For Self Employed & Freelancers In 2023

best-accounting-software-for-self-employed-&-freelancers-in-2023

Are you curious about which accounting software is ideal for self-employed individuals?

Look no further because we’ve compiled some of the best ones out there. But, before that, let’s talk briefly about what accounting software is and why it’s essential.

What is Accounting Software?

Accounting and bookkeeping software allows individuals and companies to manage their finances.

These programs allow you to do the following and more:

  • Link bank and credit card accounts
  • Record financial transactions
  • Track and manage expenses and revenue
  • Generate financial reports and analyze metrics
  • Create and send purchase orders, invoices, estimates, and proposals
  • Track inventory
  • Bill clients
  • Manage payroll
  • Collaborate with your accountant

Why Do the Self-Employed or Freelancers Need to Use Accounting Software

Every business needs to keep track of its finances, regardless of size. For one thing, freelancers tend to take on multiple projects or clients at once. This means that they have multiple streams of income. Trying to track all that by hand is time-consuming and can also take time to manage.

That being said, the best accounting software for self-employed people is the one that takes care of this. It could automate specific tasks to save you valuable time and keep all your records accurate. This tool should also allow you to generate reports so you can track how well you’ve been performing. Additionally, your accounting software should let you do accounting on the go to cater to even the busiest individual. Additionally, your accounting software for Mac and Windows should allow you to do accounting on the go to cater to even the most active individual.

Can I Do My Accounting?

DIY bookkeeping has several pros. For one thing, it’s the best thing to do if you’re starting. It lets you get a good idea of how much you are spending and is more cost-effective. It also allows you to stay in control.

The best accounting software for the self-employed mentioned below is purposefully designed to be intuitive. This means that anyone can use any one of them. They don’t have to be an accountant or even have a background in bookkeeping. That’s one of the reasons why we recommend them.

However, there are also a few cons to DIY bookkeeping. For one thing, you need to learn how to do your bookkeeping the right way. Every business must comply with any local regulations and tax laws. This includes all self-employed persons, like freelancers.

Speaking of taxes, it can take you longer to do all the filing yourself. If you are busy, it might be challenging to set aside time to do your books each week, then get everything filed with your local tax office. Lastly, if you don’t have someone double-checking your work, there’s a chance you could miss a few things. Making mistakes on your taxes could get you fined or audited. After all, the revenue service doesn’t know you made mistakes by accident, and you can’t expect them to cut you any slack.

Best Accounting Software for Self-Employed & Freelancers in 2023

1. QuickBooks Online

A screenshot of the QuickBooks Online accounting software website home page.

QuickBooks is the most popular accounting software out there. They are known for having flexible plans and robust features to handle even the most complex bookkeeping needs. They even offer a free guided setup to get you running with account connections, task automation, and advice on best practices.

Pros

  • Great for small businesses
  • Widely used and known
  • 24/7 customer support
  • Flexible pricing plans for all business sizes
  • User friendly
  • Easy implementation and integration
  • Many in-depth features
  • Cloud-based
  • Hundreds of integrations
  • Easy to search for what you need via the search bar

Cons

  • Plans can be costly compared to alternatives
  • In-depth support can be lacking
  • There is a learning curve to get started
  • Limited users on all plans

Pricing

QuickBooks pricing has four tiers:

Simple Start

  • $30/mo
  • Includes access to one user, income and expense tracking, receipt capture, mileage tracking, cash flow management, sales, and sales tax tracking, access to basic reports, 1099 contractor management, and the ability to connect a sales channel

Essentials

  • $55/mo
  • All of the above features plus two more users, time tracking., bill management, more reports, and the ability to connect two more sales channels

Plus

  • $85/mo
  • All of the above with the ability to add up to 5 users, project profitability tracking, inventory tracking, more substantial reports, and the ability to connect all of your sales channels

Advanced

  • $200/mo
  • All of the above plus access to up to 25 users, batch invoicing, employee expense management tools, expense creation, exclusive apps, dedicated account team, online training, workflow automation, data management and restoration, comprehensive reports, and more customization

2. Xero

A screenshot of the Xero accounting software website home page.

Another one of the best accounting software for freelancers, Xero, is used by over 3.5 million users across the globe. Xero is software created for people, so anyone from beginners to expert accountants can easily use it. Xero even offers to connect you with financial advisors if you need guidance.

Pros

  • Many integrations and easy to implement
  • Accounting on the go via mobile app
  • Easy to set up and operate
  • Simple and beginner-friendly UI
  • Affordable
  • Cloud-based
  • Unlimited user support

Cons

  • Limited entry-level plan
  • Hard to transfer to other accounting software from Xero
  • Limited customer support

Pricing

They have three plans:

Starter

  • $25/mo
  • Includes all the basics of receipt capture, reconciliation, short-term cash flow snapshots, and limited bill entry and limited quote and invoice sending

Standard

  • $40/mo
  • All of the above but removes the limits of bill entry and quote and invoice sending; includes bulk reconciliation

Premium 

  • $54/mo
  • All of the above plus multiple currency handling capabilities

They also have add-on services like expense management for $4/mo, project and job tracking for $7/mo, and Analytics Plus for $7/mo after a 4-month free trial.

3. FreshBooks

A screenshot of the FreshBooks accounting software website home page.

FreshBooks is an accounting software that makes accounting easy and affordable. Not only do they provide the software you need to manage finances, but they also offer award-winning, personalized customer support to back it up.

Pros

  • Useful beginner templates
  • Simple but effective
  • Cost-effective
  • Easy-to-use UI
  • Works well with other applications
  • Good customer support

Cons

  • Limited users
  • Limited entry-level plan
  • Limited customizations
  • Limited auditing functionality

Pricing

They have three regular pricing tiers offering 50% off the first six months. For this article, we will list the regularnormal prices.

Lite

  • $17/mo
  • Unlimited invoices to up to 5 clients, unlimited expense tracking, unlimited estimates, credit card and bank transfer payment capabilities, sales tax tracking, view reports, mobile app

Plus

  • $30/mo
  • All of the above plus up to 50 billable clients, automatic expense tracking, recurring billing and client retainers, unlimited proposals, business health, and double-entry reports, collaboration with an accountant, mobile mileage tracking

Premium

  • $55/mo
  • All of the above plus unlimited clients, project profitability tracking, Accounts Payable to track bills, bill payments, and vendors, customizable emails and signatures, automatic payment reminders, automatic late billing, get paid with checkout links, run financial and accounting reports

They also have custom plans for more complicated needs.

4. Wave

A screenshot of the Wave accounting software website home page.

Wave is among the more unique entries in our list of the best accounting software for self-employed people. They offer their invoicing and accounting tools for free. This US-only banking software offers optional paid payroll, payment processing, personalized bookkeeping, and coaching.

Pros

  • Free Invoicing and Accounting
  • Great for people just getting started
  • Great features
  • User-friendly and easy-to-navigate UI
  • Mobile app
  • Unlimited users

Cons

  • No third-party integrations
  • Limited functionality
  • Limited auditing functionality
  • Need to pay for some support options allowing for subpar service

Pricing

Wave is unique because its invoicing and accounting software are entirely free.

Invoicing

  • Free
  • Includes customizable, professional, unlimited invoices, automated reminders, pay directly from invoices using card, bank, or Apple Pay

Accounting 

  • Free
  • Includes unlimited income and expense tracking, unlimited users, view insights via the dashboard, access helpful reports

They also have paid add-on services:

Payroll 

  • $20 or $40/mo
  • Includes easy payments, employee portals, access to tax forms and documents,

Advisors 

  • $129/mo for bookkeeping support; $379 one-time fee for Accounting and Payroll coaching
  • Includes access to bookkeeping, accounting, and payroll  experts that can help you with your books, coaching, year-round access to advisors, and tailored insights to fit your business

They also charge per-transaction fees for processing payments through Wave.

5. Zoho Books

A screenshot of the Zoho Books accounting software website home page.

Zoho Books is one of the Zoho collections of apps. They offer end-to-end financial management. They keep updated on the latest tax regulations, compliance changes, and other finance trends. This, combined with the ability to integrate with the other apps in the Zoho suite, makes this one of the best accounting software for self-employed individuals who want to optimize other areas of their business management.

Pros

  • Has a free plan
  • Easy to use and configure
  • Access to the Zoho suite
  • Flexible and affordable pricing
  • Many features
  • Good customer support
  • Easy integrations

Cons

  • Limited users
  • Limited integrations

Pricing

You can use Zoho Books for free, and they also have five pricing tiers.

Free

  • Includes access for one user + accountant, up to 1,000 customizable invoices/yr in multiple languages, recurring invoices, customer portal, expenses & mileage tracking, multiple bank and card accounts, reconciliation, automated payment reminders, import bank and card statements, chart of accounts, journals, reporting and scheduling, email support, Zoho and other app integrations

Standard

  • $12/mo
  • All of the above plus three users, predefined user roles, up to 10 5,000 invoices/yr, recurring expenses, connect bank and card feeds, invoice and expense tracking, project tracking, bulk updates, more customization, reporting tags, billing and timesheets, custom reports, Zoho People and Zoho Project integration, and additional voice and chat support

Professional

  • $24/mo
  • All of the above plus five users, custom roles, recurring bills, retainer invoices, approve sales and purchases, vendor credits, create sales and purchase sales orders, basic multi-currency handling, stock trading, tracking project profitability, recurring journals, and templates, up to 10 workflow rules, 25 custom reports, timesheet approval, landed costs

Premium 

  • $36/mo
  • All of the above plus ten users, a custom domain, vendor portal, budgeting tools, up to 200 workflow rules, 50 custom reports, cashflow forecasting reports, Zoho Sign, and Twilio integrations

Elite

  • $129/mo
  • All of the above plus unlimited custom reports, advanced multi-currency capabilities, advanced inventory control, warehouse management, serial number tracking, batch tracking, shipping label printing, shipment tracking, Shopify Store integration

Ultimate 

  • $249/mo
  • All of the above plus up to 15 users, Advanced Analytics, real-time customizable reports and dashboards, metric tracking and data analysis, collaborative reporting, embedded reports in sites and apps

6. Stampli

Managing your own e-commerce business can be a whirlwind of responsibilities, not least keeping your accounts in check.

Make your life easier with Stampli, an interactive invoice management tool that leverages AI technology to streamline invoice processing, minimize errors, and save time. Stampli smoothly integrates with your existing ERP systems, providing a unified platform for invoicing needs. Pros:
  1. Efficient and Fast: Stampli uses AI to automate data extraction, dramatically reducing the time you spend on invoice processing.
  2. Integration: It integrates seamlessly with existing ERP systems, ensuring a unified experience and eliminating the need to switch between multiple platforms.
  3. Audit Trails: With real-time audit trails, you can see every action on an invoice, enhancing transparency and accountability.
Cons:
  1. Learning Curve: As with any sophisticated software, there may be a slight learning curve as you familiarize yourself with Stampli’s features.
  2. Pricing: The quote-based pricing may be a turn-off for some, as you cannot see upfront what the service will cost.
Pricing:
Stampli operates on a quote-based pricing system, meaning you get a customized pricing plan tailored to your business needs. While this needs more immediate transparency of fixed-price services, it only ensures you pay for what you need. A powerful tool in the arsenal of any self-employed freelancer or e-commerce entrepreneur, Stampli provides an efficient, comprehensive solution for managing your invoices. Though it may require an initial investment of time and adaptation, the payoff in improved productivity and financial control makes it well worth considering.

What Is EcomBalance? 

EcomBalance is a monthly bookkeeping service specialized for eCommerce companies selling on Amazon, Shopify, eBay, Etsy, WooCommerce, & other eCommerce channels.

We take monthly bookkeeping off your plate and deliver your financial statements by the 15th or 20th of each month.

You’ll have your Profit and Loss Statement, Balance Sheet, and Cash Flow Statement ready for monthly analysis so you and your business partners can make better business decisions.

Are you interested in learning more? Schedule a call with our CEO, Nathan Hirsch.

Conclusion

There you have it! We hope our list of the best accounting software for freelancers and self-employed individuals gave you the information you need to start organizing and taking control of your finances.

This originally appeared on the EcomBalance Blog and is available here to cast a wider discovery net.
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