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The Best Online Accounting Software for Your Small Business

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.