Quickbooks vs Freshbooks - A Complete Guide

Quickbooks vs Freshbooks - A Complete Guide | Accounting Smarts
Charles Hall

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Charles Hall

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June 10, 2022

If you are in need of reliable accounting software to help grow your business effectively, both QuickBooks and FreshBooks stand out as excellent choices.

If you are in need of reliable accounting software to help grow your business effectively, both QuickBooks and FreshBooks stand out as excellent choices.

Both QuickBooks and FreshBooks offer an array of amazing features, but ultimately deciding on one of them depends on the type of business you run. Smaller businesses in need of simple time tracking and billing would enjoy FreshBooks, but as you grow, QuickBooks provides the best support for business owners.

FreshBooks provides simple to use finance management, time tracking, and billing. QuickBooks also provides these features but with more focus on scalable tasks like payroll, inventory management, vendor invoicing, and much more. The size of your business will play an important role in deciding on the perfect business accounting software for you.

In this guide, you will find practical analysis from industry experts who understand both software and business accounting thoroughly. All features and benefits for each platform discussed have been personally tested by experienced individuals. If you are ready to learn which accounting software is best for you, keep reading.    

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QuickBooks vs. FreshBooks

Both QuickBooks and FreshBooks are capable business account software solutions with many different features to make them attractive to small business owners. They share some similar features, and they also stick out from one another in other areas. Below is a chart detailing some highlights each can share with their customers, unlike the competition.  

FreshBooks QuickBooks Online
Software Cloud-based Cloud-based
Subscription Monthly Monthly
Price Plans start $7.50/month Plans start $7.50/month
Free Trial 30-day trial 30-day trial
Key Features Unlimited invoicing and expense tracking, time tracking software Accept payments, online invoicing and billing, access to accountants, bank syncing
Mobile App IOS & Android compatible IOS & Android compatible
Integrations 70+ Apps and integrations like Hubspot and G Suite 650+ available like PayPal and Square
Payroll N/A Available w/ certain plans
Support Phone, live chat, community, resources, forum Phone, live chat, community, resources, live training

What Is QuickBooks?

QuickBooks is an online cloud-based business accounting software serving small business owners. The best way to use QuickBooks is by managing expenses, invoices, payroll, and tracking the financial health of your business.

QuickBooks has an array of different plans to help self-employed individuals, small business owners, independent contractors, and growing enterprises handle all of their accounting needs in one place. It is possible to grow your entire accounting team with the help of QuickBooks.

Businesses have access to all of the necessary features to invoice clients, bill vendors, collect payments online, and send invoices out directly from the QuickBooks portal. There are templates available of all kinds to build documents you need too.

Handle all of your bills and expenses in QuickBooks. The payments feature means you can set up autopay on bills and schedule them directly through QuickBooks. This eliminates the need to keep track of all your accounts and simply put them in one place instead.  Link your bank accounts too, and transactions will be recorded automatically for future accounting needs.

QuickBooks contains business financial statements like balance sheets, income statements, and cash flow. They can be easily managed and printed for tax season. As your business grows, QuickBooks gives you more features to sustain this growth. There are extensive payroll features with time tracking features built right in for your employees to get more work done and get paid automatically.

What is FreshBooks?

FreshBooks is an online cloud-based invoicing and accounting tool made for professionals and business owners. It is an excellent software to assist you with your day-to-day accounting and bookkeeping needs. It also includes many more features like time tracking, invoicing, and project management functions.

FreshBooks is completely web-based, and everything is stored on a cloud for you. This means you have full access from anywhere in the world with an internet connection. The initial 30-day free trial gives you the chance to glimpse into how the software works and whether or not it is the right one for you.

FreshBooks does have a robust set of features, including advanced invoicing. All invoices are customizable for you and your business to add personal touches like logos, color changes, font changes, and more. They also provide a small set of templates you can use.

FreshBooks also provides expense tracking and management. If you connect bank accounts and credit cards, it will sync those transactions into your dashboards to categorize all spending for you automatically. This makes bookkeeping much easier when the time comes to sorting through transactions.

FreshBooks does offer a complete range of services, including accounting, estimates, proposals, project management, and payments.

QuickBooks vs. FreshBooks: Features

The primary features that stand out among these two platforms vary slightly because both platforms look to appeal to a specific customer. QuickBooks is better for small businesses with a focus on growth to help automate their accounting. Meanwhile, FreshBooks aims to give freelancers and solopreneurs more control of their finances and entry-level accounting needs.

QuickBooks Features

Accept Online Payments

QuickBooks offers excellent payment services to both send and accepts payments right online for your business. They also offer such a wide selection of integrations like Paypal and Stripe to better accommodate all types of internet payments.

Below are the exact fees they charge for payments.

Fee Type QuickBooks Online
Monthly Fee None
ACH Bank Transfer 1% (Max $10)
Credit Card (Swiped) 2.4% + $0.25
Credit Card (Online) 2.9% + $0.25
Credit Card (Keyed) 3.4% + $0.25

Payroll Management

QuickBooks gives full access to its users over each payroll activity. There is a time tracking software to allow employees to track billable hours, tax documents for 1099 contractors, and automated paycheck generating to pay employees directly from the QuickBooks portal.

All of the payroll taxes are calculated by QuickBooks to save you the hassle and time required. Set it up to run automatically, and users simply track their hours and get paid.  

Automatic Bank Syncing

Once you connect all of your business accounts to your QuickBooks portal, entering transactions becomes a completely automated process. The software is intelligent enough to record all transactions and categorize them appropriately to make things easier come tax time.

You are also able to do important tasks like split transactions, make transfers, and correct any mistakes with only a few clicks of the mouse.  

FreshBooks Features

Time Tracking

Time tracking is one of the most notable features in FreshBooks. It is an easy-to-use tool that provides more accuracy than other competing products on the market. It perfectly syncs with payroll and expenses to track client projects and any employees getting paid.

The software syncs with your computer and runs in the background to see how long specific tasks really take. You can break things down further and see how much time was spent on different websites to learn exactly what the scope of a project is.

Building Customized Invoices

The customize feature in FreshBooks is extremely advanced, and there are so many ways to edit your invoices to reflect your business. There are invoice headers, colors, logos, currency, language, and added fees that can all be added to an invoice.

There is also a template library where users can pick invoices and customize them to save time.

Automatic Late Fees

Set due dates on all invoices for your customers and activate automatic late fees. This is a tool that will automatically charge a late fee if the payment date is missed by a customer. This gives your customers more incentive to pay on time and eliminates the need to constantly watch due dates by customers.

Recurring Invoices and Payment Reminders

Invoices can be set up to send out automatically on recurring dates. Sit down and get them done in one sitting instead of making it a daily task. By setting up recurring invoices, you never need to worry about forgetting to bill a customer.

Send your customers automatic payment reminders too. Make them customizable so that your brand stands out when you ask for the money.

QuickBooks vs. FreshBooks: Plans and Pricing

QuickBooks Pricing Plans

  • Self-Employed: $7.50/mo
  • Simple Start: $12.50/mo
  • Essentials: $20/mo
  • Plus: $35/mo
  • Advanced: $75/mo

Self-Employed

The QuickBooks Self-Employed plan is the most basic option and starts at a low price of only $7.50/mo. It is best for independent contractors, freelancers, and solopreneurs that need to track their finances and organize their accounting needs.

The basic functionality provides plenty of useful features like income tracking, expense tracking, schedule C deduction tracking, quarterly tax estimates, and automated mobile mileage tracking.

If this doesn’t seem like enough for you, there are other d self-employed plans that put more focus on maximizing your tax benefits.

Self-Employed Tax Bundle

The Self-Employed Tax Bundle plan contains all of the features we just looked at in the Self-Employed plan but adds extra features to keep your taxes more organized and accurate.

For only $12/mo, you get access to automate your quarterly estimated taxes to help lessen your end-of-year tax bill. Using this plan will also allow you to sync your accounts with TurboTax for an easier setup. It comes with a free state and federal tax filing too.

Self-Employed Live Tax Bundle

The Self-Employed Live Tax Bundle gives you access to the QuickBooks marketplace full of expert CPAs. You have these professionals on demand when needed to discuss tax-related questions or if you need help when filing your taxes at the end of the year.

You can even send them your filings before submitting them to have them approved. Pricing starts at $17/mo per user for this plan.

Simple Start

The Simple Start plan is a low-priced option for small businesses that provides many features for a low cost of only $12.50/mo. It gives you full access to what QuickBooks is all about.

Features include income tracking, expense tracking, transaction sorting, online payments, invoicing, and advanced reporting. Everything included is a step in the right direction for any small business looking to improve its accounting practices.

You also gain access to track tax deductions for your business throughout the year and automate the process. This saves you time with employees and sales tax efforts later on.

The Simple Start allows everything related to 1099 contractors with ease. It creates all necessary documents and payroll that can be executed right in the QuickBooks portal. Payroll allows you to pay employees directly from the platform too.

You also have important features like mileage tracking, cash flow reports, and receipt capture.

Essentials

The Essentials plan is an excellent option for QuickBooks users to consider. The plan only costs $20/mo and gives you a long list of incredible features. You now will have access to all of the same features in the Simple Start plan, plus much more.

You are given three licenses for yourself and employees when signing up for the Essentials plan. This means you can grow your accounting team while remaining at a low cost of only $20 per month.

All employees are given access to the time tracking software too. This means they can manage others and track their own time to further automate the entire payroll process.

Plus

The pricing for the Plus plan is $35/mo and perfectly suits growing businesses that need better features to handle their organization’s financial and accounting requirements. All features in the Essentials plan are included in this plan and much more.

The Plus plan upgrades your user licenses to five to expand your team. You now can track more time, grow your accounting team faster, and handle more extensive tasks inside the software platform for only a small increase in the monthly cost.

Other feature upgrades include inventory tracking and project profitability reporting and tracking. Both features make your accounting practices more accurate and ensure better management in the future.

Advanced

The Advanced plan is best for bigger businesses with a team of users ready to implement the QuickBooks software into their everyday routine. You have access to so many different reporting and tracking features to improve business processes.

The plan starts at $75/mo and comes with 25 user licenses. This is one of the best values on the market, and no competitor can offer this kind of access for such a low price. For access to business analytics, insights, invoicing, role access customization, and premium apps, it doesn’t get any better.

Live Bookkeeping

Live Bookkeeping is a cheap add-on available for every plan. It is a one-time $50 fee to allow a QuickBooks expert to fully set up your bookkeeping. They will sync all of your accounts, automate your tedious tasks, and teach you the best ways to use the QuickBooks platform for a small fee.

This is an optional add-on and is not required.

Full-Service Bookkeeping

The full-service bookkeeping option is a custom plan offered by QuickBooks to small businesses without accounting teams. They will provide a custom quote to handle all of your bookkeeping for you. They provide a free consultation to discuss the scope of what you need.

FreshBooks Pricing Plans

  • Lite: $7.50/mo
  • Plus: $12.50/mo
  • Premium: $25/mo
  • Select: Custom Pricing

Lite

The Lite plan with FreshBooks is the entry-level option starting at only $7.50 a month. It allows you to have five billable clients with access to client profiles, credit card storing, client portals, client credits, and automated invoicing.

The billing solutions are reliable too. You have access to send unlimited invoices, estimates, schedule late fees, send late payment reminders, accept deposits, and manage budgets for projects with ease.

Collecting payments is easy, too when you have credit card payment, ACH bank transfer, and checkout link access. You also have unlimited time tracing access to stay on top of all projects effectively.

Plus

As you grow and upgrade to the Plus plan, so do all of your features. The pricing is only $12.50/mo, and you can increase the total number of billable clients to 50. This means unlimited invoices for up to 50 different clients.

Other new features include mileage tracking, accountant access, double-entry accounting, recurring billing, client retainers, and automatic expense tracking.

You can also add team members to the plan for an additional $10/mo per user with access to plenty of integrations too.

Premium

The Premium plan is a big step up and more designed for larger businesses with many different clients and a team of employees. For only $25/mo, you get upgraded to unlimited billable clients.

Other new features include accounts payable access, project profitability projections, customizable email templates, email signatures, and a wide range of new reporting features for better data.

Select

The Select plan is a customized plan with new features added based on specific business needs. Pricing is also customized and requires a discussion with a sales rep to determine the exact scope of the plan.

Some of the features include two team member accounts, a dedicated account manager, custom onboarding services, and the removal of FreshBooks branding from client emails. This is the plan for enterprise accounts working at scale.

Who Should Use QuickBooks?

QuickBooks is an ideal choice for all. It offers such a wide range of features that it can cover everything you need and still have leftover features for you. Whether you are just starting out or a growing enterprise, there is a plan that can fit your needs. All plans are adjusted based on the number of employees and business size with more features to help you grow.

If there was one ideal customer for QuickBooks, it would be the small business owner with a growing team looking to automate aspects of their accounting work. QuickBooks uses so many different features to eliminate tedious tasks and let you focus on your business.

However, we have spoken to freelancers too who simply love the software. It remains low-cost while providing everything needed to run a business smoothly. There is payroll, time tracking, advanced reporting, inventory management, and much more. All of these features can give you a slight edge with better tax reporting and day-to-day performance.

QuickBooks Pros and Cons

Pros

  • Online cloud access from anywhere.
  • Financial analysis reports.
  • Time tracking tools for invoicing.
  • Easy to use.
  • Quick insights dashboard.
  • New feature releases yearly.
  • P&L statement for all business focuses.
  • Organizational budget generation.
  • Intuitive interface for customizations.  

Cons

  • The budget feature is solid but lags behind other competitors.
  • Invoice customization is below average.
  • Bill pay can be confusing at times.
  • The direct deposit feature can be expensive.

Who Should Use FreshBooks?

FreshBooks can provide enough features to give small business owners the support they need to handle all accounting and financial needs. However, as your business starts to scale and grow, you may run into problems when you need more licenses and features to sustain the growth.

For these reasons, FreshBooks is best for new businesses, freelancers, and independent contractors who need invoicing, time tracking, and basic accounting features to run their business on a day-to-day basis.

FreshBooks Pros and Cons

Pros

  • Free trial available to test the software before committing.
  • User-friendly interface for beginners with an easy-to-navigate dashboard.
  • Excellent time tracking tool available.
  • Fully customizable invoicing generator.
  • Reliable payroll feature.
  • Monthly pricing is affordable.

Cons

  • The mobile app is extremely limited.
  • Larger businesses will struggle to scale with the features offered.
  • Low amount of integrations available compared to QuickBooks.
  • Lack of support for other currencies.

QuickBooks vs. FreshBooks: Which Software Is Best?

Both QuickBooks and FreshBooks are extremely similar in the type of features they offer. But they are geared towards a slightly different target customer.

FreshBooks aims to appeal best to the solopreneur, independent contractor, and freelancer looking to manage individual income and expenses. They tailor each feature to best serve this market, including invoicing and time tracking for client projects.

While QuickBooks also offers both of these features, they really excel in the larger plans aimed to be used by small business owners. The plans scale up much quicker, and they offer many licenses to help accounting teams do well.

Charles Hall

Charles Hall

Charles has spent 25 plus years in the world of accounting and business. His experience includes working as a CPA/Auditor international accounting firms. He has worked as a controller and as a COO for small to medium sized companies.

Learn more about Charles Hall