The 5 best Xero alternatives
Short answer
The best Xero alternatives are QuickBooks, FreshBooks, Wave. QuickBooks is our top pick — it scores 8/10 and is best for Small businesses with employees. The right choice depends on your budget, team size, and which features matter most.
Why look for a Xero alternative?
Xero scores 8.3/10 in our review and works well for many teams — but it is not the right fit for everyone. The most common reasons readers look elsewhere:
- ✗Less popular with US accountants than QuickBooks
- ✗Starter plan has invoice/bill limits
- ✗Payroll only available in select countries
Xero alternatives, ranked
QuickBooks
Top pickSmall business accounting that does the heavy lifting
QuickBooks is the dominant small business accounting software in the US. It handles invoicing, expense tracking, payroll, tax preparation, and financial reporting. Best for businesses that work with a bookkeeper or accountant.
Strengths
- ✓Gold standard for accountants and bookkeepers
- ✓Comprehensive payroll features
- ✓Huge integration ecosystem
Best for
- →Small businesses with employees
- →Anyone working with a US-based accountant or bookkeeper
FreshBooks
Invoicing and accounting for small businesses
FreshBooks is an accounting and invoicing platform designed for service businesses and freelancers. It covers invoicing, expense tracking, time tracking, estimates, and basic double-entry accounting. Much easier to use than QuickBooks, though less powerful for complex accounting needs.
Strengths
- ✓Extremely easy to use
- ✓Beautiful invoices
- ✓Time tracking built in
Best for
- →Freelancers and consultants billing by project or time
- →Service businesses
Wave
Free accounting software for freelancers and small businesses
Wave offers genuinely free accounting software — invoicing, expense tracking, double-entry bookkeeping, and financial reports with no subscription fee. Revenue comes from optional paid add-ons: payroll (US and Canada only) and payment processing (per-transaction fee). Acquired by H&R Block in 2019. Wave is especially well-suited to self-employed individuals and very small businesses that don't need the complexity of QuickBooks or Xero.
Strengths
- ✓Core accounting (invoicing, expense tracking, reports) is genuinely free
- ✓Double-entry bookkeeping — proper accounting, not just spreadsheets
- ✓Easy bank reconciliation via bank connections
Best for
- →Freelancers and self-employed individuals who need real accounting at $0
- →Very small businesses that want proper books without a subscription
Gusto
Payroll, benefits, and HR for small businesses
Gusto is the leading payroll and HR platform for US small businesses, handling full-service payroll (direct deposit, tax filings, W-2s, and 1099s), employee benefits (health insurance, 401k), and basic HR tools (offer letters, onboarding checklists, PTO tracking). It automates federal, state, and local payroll tax filings — one of the most time-consuming compliance tasks for small business owners. Gusto is contractor-friendly, making it popular with agencies and studios that mix employees and freelancers.
Strengths
- ✓Automated payroll tax filings — federal, state, and local handled automatically
- ✓1099 contractor payments and management alongside employee payroll
- ✓Employee benefits (health, dental, 401k) integrated in one system
Best for
- →US-based agencies and studios with a mix of W-2 employees and 1099 contractors
- →Small businesses that want payroll, HR, and benefits in one place
Deel
Hire and pay contractors and employees in 150+ countries
Deel solves international hiring compliance — it lets businesses hire full-time employees and contractors in 150+ countries without setting up a local legal entity. Deel acts as the Employer of Record (EoR), handling local employment contracts, tax compliance, and payroll in each country. For contractors, Deel manages contracts, invoicing, and payments in local currencies. Built for globally distributed teams. Critical infrastructure for agencies and remote-first businesses hiring internationally.
Strengths
- ✓Hire legally in 150+ countries without setting up a local entity
- ✓Contractor management (contracts, invoicing, payments) free for up to 200 contractors
- ✓Handles local tax compliance, social contributions, and mandatory benefits automatically
Best for
- →Remote-first agencies hiring developers, designers, or marketers internationally
- →Any business paying contractors across multiple countries who wants compliance certainty
Xero vs. the alternatives
| Tool | Score | Starting price | Free plan | Ease of use |
|---|---|---|---|---|
| Xero(current) | 8.3/10 | $15/mo | No | 8/10 |
| QuickBooks | 8/10 | $17/mo | No | 7/10 |
| FreshBooks | 8.2/10 | $19/mo | No | 9/10 |
| Wave | 8.2/10 | — | Yes | 8.5/10 |
| Gusto | 9/10 | — | No | 8.5/10 |
| Deel | 9/10 | — | Yes | 8/10 |
Xero alternatives — FAQ
What is the best Xero alternative?
QuickBooks is our top-rated Xero alternative, scoring 8/10. It is best for Small businesses with employees.
Is there a free Xero alternative?
Yes — Wave, Deel offer a free plan you can use to evaluate the tool before paying.