Xero vs QuickBooks: Which Is Right For Your Business?

After thoroughly researching and testing QuickBooks and Xero, we found that Xero is the better accounting software overall – especially for businesses with high turnovers – down to its superior expense management and billing features, and extensive library of integrations. There isn’t much in it though, with QuickBooks boasting a slicker interface, stronger help and support tools, as well as industry-leading cashflow projection features that make budgeting a breeze. 

Truth be told, due to Xero and QuickBooks’s steep learning curves, extensive set-up requirements, and cluttered interfaces, both platforms are best suited for experienced accounting professionals willing to invest time into the platforms. For small businesses managing simpler processes, we recommend our best-rated accounting software – Zoho Books – instead, due to its intuitive design and smaller price tag.

Choosing between QuickBooks and Xero is by no means plain sailing. So, to guide you through the process, this article offers a granular comparison of their pricing plans, usability, stand-out features, and support options. Read on for our full research-backed details, and see how they weigh up at a glance below.

In this guide:

• Xero vs QuickBooks: At a Glance
• Xero vs QuickBooks: Top Features Comparison
• Xero vs QuickBooks: Help and Support
• Xero vs QuickBooks: Ease of Use
• Xero vs QuickBooks: Pricing Plans
• How do Xero vs QuickBooks Compare to Alternatives?
• How Did We Compare Xero vs QuickBooks?
• Xero vs QuickBooks: The Verdict

Xero vs QuickBooks: At a Glance

Xero and QuickBooks are two of the best accounting software available on the market today. Torn between the platforms? We sum up some key deciding factors straight off the bat, to help you determine their suitability for your business.

• Xero’s core accounting features are better than QuickBooks, with the platform boasting superior fixed asset tracking, billing, and bank reconciliation tools.
• Xero allows unlimited users on all of its plans, making it a slightly better choice than QuickBooks for larger teams with simpler accounting requirements.
• Xero lets users connect with more integrations than QuickBooks (1000+ vs 750+), allowing businesses to extend the capabilities of the platform further.
• QuickBooks is cheaper to get started on, although Xero is currently running a deal where you get its Premium plan for $1 per month, for the first six months.
• QuickBooks is a stronger choice over Xero for restaurants, because of QuickBooks’ built-in inventory management system and native point-of-sale (POS) integrations.
• QuickBooks has a more modern design, while Xero’s typography and interface make it feel quite dated in comparison.
• Xero and QuickBooks are both quite complex to get started on, but QuickBooks’ helpful tooltips and live chat options make it slightly easier to adjust to the steep learning curve.

Read on for a deeper dive into Xero and QuickBooks’s main comparison points, and check out which businesses each provider is best suited for below:

Who is Xero better for?

• Experienced accounting professionals managing complex workflows
• Businesses with high turnovers and consistent billing needs
• Users willing to invest time in a longer set-up process for heavier-duty features

Who is QuickBooks better for?

• Businesses that want to improve budgeting efforts with advanced cash flow projection tools
• Businesses that would benefit from customized reporting tools to improve performance
• Users who prefer a modern-looking system with a clear set-up process

Xero vs QuickBooks: Top Features Comparison

QuickBooks and Xero both offer a bountiful array of accounting and financial management features. Here’s our comparison of how both of the provider’s toolkits compare head-to-head.

• Tax preparation 
• Invoicing
• Financial planning
• Collaboration
• AI automation
• Third-party integrations

Tax preparation: Xero

If you’re planning to use accounting software to optimize your tax returns, you’ll be in safe hands with either QuickBooks or Xero. Both providers offer stand tax capabilities like tax rate calculations and tax form generation, scoring neck and neck in this research category. 

However, with QuickBooks, you’ll need to set up VAT records first, and manually add tax categories to stock products, which might make the process a bit more daunting for a beginner than Xero. Xero supports a slightly broader range of tax types too, including goods and services tax (GST), making the platform’s tax preparation tools stronger than QuickBooks’ overall, especially for businesses navigating complex tax processes.

QuickBooks asks you for simple payroll tax information when setting up. Source: QuickBooks

Unfortunately, neither provider offers tax forecasting or planning tools, so if this is a dealbreaker for you we’d recommend using a competitor like FreeAgent, instead, which has both of them available.

Invoicing: Tie

QuickBooks and Xero offer some of the best invoicing and quoting features in the industry. From recurring invoicing and automated invoice and quote sending, to useful payment reminders, the platforms provide you with any capability you’ll need to effectively track payments.

You’re able to search through Xero’s aged payable summaries through a variety of filters. Tech.co user testing

Both pieces of accounting software also notify you when a client has viewed an invoice, making it easier for your team to track and chase outstanding payments. Unlike budget providers like Wave, QuickBooks, and Xero offer multi-currency support for invoicing, helping them both to net a perfect score in our research subcategory, and making them a solid choice for international businesses.

All things considered, our research found that Xero’s and QuickBook’s invoicing features are neck-and-neck, and are actually some of the best we’ve researched – alongside those offered by Zoho Books.

Learn more about how QuickBooks compares to the free accounting software Wave.

Financial planning: QuickBooks

QuickBooks and Xero offer fairly similar reporting features, both letting users create new reports from scratch, export reports with embedded calculations, use build-in templates for key financial statements like balance sheets, and cash flow statements, and more. 

Xero’s reporting dashboard gives you an instant overview of how your business is tracking. Source: Tech.co user testing

However, if you’re serious about protecting your company’s future finances, QuickBooks will be a slightly better option. Both providers offer expense tracking, cashflow projection, and budget-setting tools, but QuickBooks users can be alerted about potential cash shortfalls or surpluses with its Cash Flow planner add-on, which is a capability that isn’t available with Xero.

Xero’s profit and loss features give you a detailed overview over your businesses financial health. Source: Tech.co user testing

Collaboration: Xero

Whether you manage a big team or operate fully remotely, collaboration features help to improve the efficiency of the accounting process by streamlining employee and client communication.

After pitting the two providers head-to-head, we found that Xero’s collaboration features are stronger, namely because the software supports unlimited users on all pricing plans. QuickBooks, on the other hand, has pretty strict user limits on all plans, making the software less suitable for large teams with workers who need to view financial data simultaneously.

Xero’s unlimited user caps allow large teams to track and manage financial data simultaneously. Source: Xero

QuickBooks didn’t score badly in the category, however. Both providers include access to a client portal, giving customers a secure way to access their financial information and view and download invoices. QuickBooks also lets users collaborate on documents in real time, which will be especially useful for remote teams.

AI automation: Xero

Artificial intelligence is becoming increasingly central to accounting software, with the emerging technology helping to automate a wide range of repetitive tasks. Both providers are ahead of other options like ZohoBooks, Sage, and FreshBooks when it comes to AI. However, our research revealed that Xero’s AI toolkit is slightly more impressive, as the provider lets users automatically categorize budgets and forecasts – a capability not currently available with QuickBooks.

Truth be told, there isn’t much in it though. Both providers offer useful AI-powered insights and are capable of classifying expenses automatically, which can be a huge time-saver for businesses that are used to carrying out the process manually.

Third-party integrations: Xero

If you want to extend your accounting platform with third-party integrations, Xero has the edge. The platform offers over 1000 third-party apps for businesses to choose from, in comparison to QuickBooks’ still impressive selection of over 750.

The Xero App Marketplace covers categories including CRM, invoicing, inventory, time tracking, ecommerce, and more, with new entries being added regularly. Xero also offers ten in-house apps that can help you access its features on your mobile device, and grants businesses open API access to build custom integrations.

The QuickBooks app library provide us with access to more than 750 third-party integrations. Source: Tech.co testing

QuickBooks is no slouch, either. It also offers API support and its App Store lets you filter results by category and industry, making it easier for users to locate useful integrations. While its app marketplace isn’t quite as expansive as Xero’s, the options it offers are still head and shoulders above its closest competitors like ZohoBooks and FreshBooks, so it’s still a great option for businesses that rely heavily on other software services.

Xero vs QuickBooks: Help and Support

Xero and QuickBooks are powerful accounting platforms, but their complexity compared to other systems means that you may need to rely on help and support features from time to time.

After researching their features and testing the support lines, we determined that QuickBooks offers much more useful customer support than Xero. While both providers let you resolve queries with a user forum and knowledge center, QuickBooks goes above and beyond by giving users access to an AI chatbot 24/7, as well as live agents during traditional working hours. 

Xero offers tons of resources to help you resolve issues independently. Source: Xero

While QuickBooks users will need to find the phone number separately on its support page, the provider also lets you talk to agents directly on the phone, which is a perk that Xero does not currently offer. All in all, this makes QuickBooks a better option for businesses that want to find resolutions quickly, without having to sift through tons of information. 

It’s not quite a clean sweep though. After trialing out the QuickBooks knowledge center, a member of our testing team found that pages frequently failed to load, making it harder for them to access important resources quickly. In comparison, Xero’s support resources proved to be much more reliable, with one user tester praising their ability to help them resolve issues they were facing with specific tasks like changing currency.

Xero vs QuickBooks: Ease of Use

Frankly, neither Xero nor QuickBooks are particularly easy platforms to use. However, after trialing out both pieces of software, we preferred QuickBooks, due to its comparatively modern interface, beginner-friendly set-up process, and intuitive layout.

While QuickBooks’ is best suited for professionals or businesses willing to invest time into mastering its complexities, the platform offers a number of liferafts for the average user: including helpful tooltips, a well-organized dashboard, and prepopulated fields to streamline tasks. Our team did note a steep learning curve, however, particularly when it came to setting up tax and expense processes. Therefore, if you only need an accounting platform to handle simple tasks, we’d recommend going with a more beginner-friendly like FreshBooks, instead.

QuickBooks’ interface is much more modern and slick than Xero’s. Source: Tech.co user testing

Similarly to QuickBooks, Xero boasts a structured navigation that positions it well for professionals who are already experienced with accounting processes. We also found specific tasks – like personalizing emails and managing bills – particularly streamlined.

Yet, our overall experience with Xero was quite negative. Not only is Xero’s interface and typography quite outdated, but it also gives users poor visual feedback, which is why it wasn’t able to beat out QuickBooks in this category.

Learn more with our how-to guide for QuickBooks Online.

Xero vs QuickBooks: Pricing Plans

Overall, QuickBooks tends to be cheaper. Granted, this doesn’t necessarily mean QuickBooks is the most cost-effective option for your business needs.

Xero offers three price plans with differing levels of features. Xero’s pricing starts at $15 per month and reaches $80 per month. However, the provider is giving businesses an impressive 90% off for the first three months, bringing its entry price down to just $2 per month for its Early plan.

QuickBooks, meanwhile, offers five different plans: QuickBooks pricing plans range between $35 and $235 per month. QuickBooks is also running a deal that gives you 50% off for the first three months, helping to lower the barrier of entry for businesses getting started with the software.

Here’s how each accounting software vendor breaks down their services, so you can see how they compare.

Contracts

While Xero offers cheaper packages overall, the provider makes businesses sign a contract in order to move forward. Xero also charges you if you cancel your membership without giving one month’s notice, making it a less flexible choice for businesses after a part-time accounting solution.

Free Trials

Both services offer the same trial period: 30 days for free.

That said, both QuickBooks and Xero often offer a special entry deal for your first few months, although these deals can vary. At different seasons of the year, QuickBooks plans have been between 50% and 70% off for the first three months. Whatever the current deal, users will need to skip their free trial to qualify.

Similarly, all of Xero’s plans are often 50% off for the first three months. This means that Xero Early may be as cheap as $6.50 per month when 50% off, while QuickBooks Simple Start would cost just $9 a month, provided it is offering the same deal.

Neither QuickBooks nor Xero offers a permanent free plan. If that’s what you’re looking for, we have a guide to the best free accounting software.

How Does Xero vs Quickbooks Compare to Alternatives?

Xero and Quickbooks are both solid options for professionals with complex needs. But truth be told, our research found that Zoho Books will be a safer bet for smaller businesses, offering better core accounting features than both QuickBooks and Xero, with a smaller price tag. Zoho Books’ support features let it down, however, so if you expect to be reaching out for support often, we’d stick with QuickBooks.

The home dashboard from Zoho Books provided us with lots of valuable data to keep us informed. Source: Tech.co testing

If you’re a freelancer or small business primarily focusing on invoicing and tracking expenses, FreshBooks is another great alternative. When we tested out the platform, we found it easier to use than Xero and QuickBooks, and its 24/7 help center rivals QuickBooks, making it a reliable option for businesses using accounting software for the first time.

FreshBooks makes simple tasks like managing invoices straightforward. Source: Tech.co user testing

There’s no dearth of quality accounting solutions. Check out our comparison table below to see how the best contenders weigh up side-by-side:

How Did We Compare Xero vs QuickBooks?