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The Best Online Accounting Software for Your Small Business

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Online accounting software is increasingly a great option for small businesses today, as it allows them to save money instead of frequently seeing a certified accountant for every financial tracking task. 

Besides the cost-saving advantages of online bookkeeping software, greater convenience is another attractive benefit. Think of all the trips to your accountant that you’ll save since you can simply take care of a number of your accounting calculations from your own computer.

Accounting software is accessible and provided through the cloud. It empowers small businesses to keep track of everything from their bookkeeping and records to their general accounting needs.

Not all small business accounting software is created equally. Neither is each solution a good fit for your specific business needs. That’s why it’s instructive to understand what each one’s strengths are over the other.

Before we get into that, it’s also very helpful to know what the best and most common features of this type of software are. You want to be able to make the most informed decision possible before committing to buy accounting software for your small business.

Best online accounting software
Which is the best online accounting software for your small business? (graphic source)

Features to Look for in Online Accounting Software

Here are some of the important features to consider when choosing the software that’s right for you:

  • Fundamental Accounting Tasks – This is a category that covers the basics like income and expense tracking, invoicing, financial report processing, and client/vendor management.
  • Task Automation – Any decent online accounting software should let you automate billing, past-due reminders, and recurring payments, saving you time and making you more productive.
  • Contact Management – You want software that manages your customer contacts or seamlessly integrates with your current contact-management software.
  • Preparing Taxes – This feature includes smaller subsets like automatic tax calculations, tax and multiple tax rate reporting, and the wherewithal to email any relevant data and files to your accountant in a second.
  • Merchant Account Support – You want to be able to seamlessly accept credit card payments, and this is the feature to ensure that.
  • Estimate and Quote Creation – Your online bookkeeping software will typically have various premade and custom templates available to let you produce both estimates and quotes for your clients. Converting these into invoices automatically is a cinch.
  • Processing of Payrolls – Your software should let you do basic functions like entering timesheets, printing checks, calculating pay, and, of course, actually paying your employees.

Here are a few additional features that can help differentiate your choice: 

  • Mobile Functionality – Chances are that you use mobile more than desktop these days, as most people do. It’s handy and convenient to be able to manage your accounting tasks wherever you are, whether that’s on vacation, in transit, or just outside. This is very useful if you’re a business owner who travels a lot for work.
  • Integration With Third-Party Apps – So much of business these days is about integration because your small business depends on data from various apps and tools. Any good accounting software for small business should provide integration with POS systems, card-processing tools, various Google apps, ERP, inventory tools, and ecommerce solutions.
  • Multi-User Support – It’s common for this software to provide access to both you and your accountant, so you’re always on the same page and don’t have to do everything on your own (you’re still paying your accountant, after all).

How to Choose Between the Software Options

Ask yourself the following things when comparing and determining which software solution is right for your small business:

  • Does it come with a free trial?
  • Can it easily scale with your growing business?
  • Does it work well with your bank’s system?
  • Can you restrict access for certain users?
  • Does it guide you on whether or not you’re complicit with generally accepted accounting principles (GAAD)?

10 Best Small Business Accounting Software - With Online Features

Here are ten robust online accounting software solutions to consider working with for your small business bookkeeping and financial tracking. Keep an eye on the features mentioned above—and give those that fit your needs best a good trial run.

1. Intuit QuickBooks Online

Intuit QuickBooks Online Accounting Software

This is one of the most well-known online accounting tools, and with good reason. It’s great for a slew of small business owners, from entrepreneurs and freelancers to consultants, store owners, and service providers. It’s not only easy to use, but it’s cheapest plan—limited to one user—won’t skimp on the features that small business owners need to handle their finances efficiently.

With its task automation, QuickBooks also saves you a lot of time, while its customer-support service are expansive, including phone and chat support and a slew of on-site help materials like a knowledge base and a community center.

Since many accountants also already use QuickBooks, your accountant will likely already be able to use this app easily.

2. FreshBooks

Freshbooks Small Business Accounting Software

FreshBooks is particularly strong in the mobile category, sporting a deep and beneficial app for both iOS and Android, making it perfect for small business owners who travel a lot and can’t always sit in front of a desktop.

Its strongest feature is its expansive offering of time-saving tools, which include:

  • Invoicing on the go with easy create, send and manage options
  • Thorough pay options with both PayPal and credit-card processing of invoices that includes automatic tracking of outstanding balances
  • Expense logging that allows you to efficiently track any expenses anywhere
  • Seamless function integration via contact imports, estimate conversions, and number-crunching features

Learn more about working with Freshbooks: 

3. Zoho Books

Zoho Books Online Accounting Finance Software

Zoho Books specialty is making life easier especially for very small business owners like freelancers, consultants, sole proprietors, and home-based business operators. Its charm is based on ultra-simplicity based on giving these business owners the support they need from reliable bookkeeping software, without the extra complications from software designed for bigger businesses.

All the fundamentals of highly useful online accounting software are present here, such as:

  • Creating and sending invoices
  • Tracking expenses
  • Syncing bank accounts
  • Creating financial reports
  • Handling accounting on the go

While simple, its suite of tools is deep enough to scale with your growing small business. It’s worth mentioning, too, that its dashboard provides an amazing user experience, with no clutter and clear navigational cues that enable efficient invoice creation.

4. Xero

Xero Small Business Online Accounting Software

Think of Xero as a cheaper alternative to QuickBooks while still including the basic, accounting capabilities of QuickBooks. In some respects, it’s a better value than QuickBooks because features like adding unlimited users, expense reports, billing, and 1099s are all extra on QuickBooks.

Other pluses of Xero are that its interface is very easy to use, offering small business owners a great user experience where they can quickly find everything they need for invoicing and expense tracking right on the app’s navigation.

Xero also offers a free trial, which is crucial in being able to decide if particular online accounting software is right for you.

5. Wave

Wave Online Accounting Software Small Business

Wave is accounting software that’s meant to appeal especially to very small businesses, as well as freelancers and contractors. Its appealing design and interface is just the beginning of this surprising package that improves with each new iteration. This software is mostly free, as you end up only paying for payroll, payments, and premium support.

Taking the minimalistic approach, this app offers a bare-bones interface complete with navigation and user-interface aids. Its payment and transaction screens provide crystal-clear usability that help very small business owners get through their invoicing and bill-tracking tasks more efficiently.

Beware, though: As a mostly free solution, Wave will show you ads on the right of your screen.

6. Sage 50

Sage 50 Online Small Business Accounting Software

Sage 50 stands out for its inventory management tools, which are more powerful than the competition’s. As with any good online bookkeeping software, its dashboard provides great usability via its customizability, so you can quickly incorporate shortcuts for functions you use the most.

If customer service and support are things you care about a lot, you should give Sage 50 a strong look because it provides both one-click chat and unlimited phone support. Sometimes, if you can’t make something work with software, there’s no substitute to getting on the phone and having a live rep walk you through your issue.

However, new small business owners may find the learning curve a bit steep getting used to this app compared to QuickBooks.

7. AccountEdge Pro

AccountEdge Pro Small Business Accounting Cloud Software

This app is available on desktop and mobile, on Mac and Windows. Its availability on numerous devices and platforms makes it convenient to use, and it offers deep customizability. User interface and navigation tools are easy to use, whereas the in-depth transaction and record-keeping templates make it quick to stay organized.

Still very appropriate accounting software for small businesses, Account Edge Pro offers more industrial-strength accounting features, such as refined time billing and inventory management and tracking for more complex issues.

Again, software like this may prove to be a bit difficult for new small business owners who may need help from their accountants to use it beyond just the basics. Seasoned small business owners should feel at home with its deeper features though.

8. OneUp

OneUp Online Accounting Software for Better Bookkeeping

OneUp stresses automation in its approach to handling finances. It seamlessly integrates with your bank to do the heavy lifting for you, so you can focus on running your small business. Featuring a 30-day free trial, this online accounting app helps you stay on top of your cash flow and your business profits.

Its standout features are its pricing and inventory management tools along with its strong support of double-entry accounting transactions and records. It's ideal for simple project management; it’s a cinch to convert forms related to sales orders. It has a standout Android app, which will please business owners who are on the go a lot.

Unfortunately, you can’t set user-access levels by activity, and there’s no dashboard, making navigation a bit challenging.

9. Nola Pro

Nola Pro Powerful Online Accounting Software

Nola Pro is initially free, but if you want a deeper, more customizable solution, you’ll have to pay for some add-ons. Nonetheless, the selection of add-ons is generous and thorough, with more than 100 add-ons being available for business owners who want to personalize this to their needs. This online accounting software supports payables, billing, and customer tracking, while its browser-based interface is efficient from a navigation standpoint.

Double-entry accounting, quick contacts management, and order management round out its host of features for business owners. It also offers a free trial, which is always a plus.

10. Outright (GoDaddy)

Outright GoDaddy Online Bookkeeping Accounting Software

Simplifying your accounting processes is the focus of Outright, so what’s not to like about that? It delves deeply into your bookkeeping data to assist you and your accountant in preparation for the tax season. Expenses and sales are automatically categorized; after this organization, Outright utilizes that data to prepare a business’ Schedule C as well as determine your taxes owed.

Say goodbye to spreadsheets once and for all with this solution! Take up less time to do your bookkeeping with this accounting software package and spend more time on growing your small business.

3 Tips for Getting the Most From Online Accounting Software

Online accounting software helps make your life easier, but it’s not going to help if you don’t understand some basics, first. With that said, here are some tips to maximize your benefits from accounting apps:

  1. Demo the Software and Give it a Full Trial Run – Many apps have free trials, which is your chance to see whether it’s a good fit for you, at no cost to you.
  2. Understand Accounting-Term Basics – Familiarize yourself with basic accounting concepts prior to using these apps, such as accounts receivable, job costing, and fixed assets.
  3. Double-Check to See if Your Accountant Knows the Software – These apps don’t mean that you don’t need your accountant anymore! They’ll just help to streamline things and increase your productivity, but it’s always wise to ask your accountant if he or she is already familiar with the software you plan to use, for productivity’s sake.

You may want to browse through our finance tutorials here on Envato Tuts+ to learn more about accounting best practices and how to handle money better in your business. Also, here is some good beginner bookkeeping training to get started with:

Online accounting software will make your life as a small business owner easier. This applies to freelancers, contractors, and entrepreneurs alike. It’s not a complete substitute for your accountant, however. 

Keeping this in mind, do your research to determine which of these featured apps is the best fit for your business needs, and start saving time, increasing productivity, and focusing on growing your business instead of dealing with accounting hassles.

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