QuickBooks Online vs. Xero – Which Accounting Package Should You Choose?

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Cloud accounting software enables you to manage your books online, stay up to date with your taxes and keep track of your cashflow. For small businesses, setting up cloud accounting can be hugely beneficial as not only does it mean that you access your accounts from anywhere, anytime, but also means that all of your files are stored on a secure server rather than on your hard drive.

There a huge variety of cloud accounting packages on the market. Two choices available in ServiceM8 are QuickBooks Online and Xero. Both systems have similar features including paying bills, invoicing as well as being able to integrate with your job management system, like ServiceM8. So, which should you choose? In this blog, we will look at some of the key areas in the software to help you make a decision, QuickBooks vs. Xero?


QuickBooks Online and Xero both offer monthly price plans, unlocking more functionality with higher price points. Prices start at £11 per month for QuickBooks and £26 a month for Xero.


Both programmes make it possible to automate your expenses which is ideal for regular payments such as rent or internet fees. However, this is only available in QuickBooks Online on a higher price plan. In Xero, it is included as standard.


One of the key areas where implementing a cloud accounting system like Xero and QuickBooks Online can help your business is in managing invoices and making sure you get paid on time.

Here’s a comparison of some of the most commonly used invoicing options

Services QuickBooks Online Xero
Send recurring invoices Yes Yes
Send payment reminders Yes Yes
Automatically add late fees No No
Bill for hours worked Yes (at highest plan) Yes (at highest plan)
Integrate with inventory Yes (extra cost) Yes
Customise Invoices Yes (within the software) Yes (templates to be uploaded)

Whilst there are many similarities to these features, there are a few key differences, which depending on how your business works, may help you decide which software system to use.

For example, if you are Xero user and want to customise an invoice you will need to upload an invoice form template from Excel through the settings menu. In QuickBooks Online, however, invoices are directly editable in the programme. If you use ServiceM8, this feature may be irrelevant, especially if you use the invoice templates in ServiceM8. Automatic payment reminders for unpaid invoices are included for both Xero and QuickBooks Online. However, in Xero, all of you customers will receive these reminders. Users of QuickBooks Online can choose which of their customers receive these reminders.


The reports section, similar to the one in ServiceM8, makes it easy to track profit and loss, cash flow and your balance sheet. In both Xero and QuickBooks Online, these reports can be customised as per your business needs, letting you add extra columns and compare time periods.
In addition, Xero also includes an equity statement. This is useful if there are many investors in your business. The equity statement makes it possible to see equity draws plus more. QuickBooks Online, on the other hand, gives you more insights into accounts receivable. It does this by letting you see a profit and loss breakdown per customer as well as a comparison between prepared estimates and sales.

Ease of Use

For many, when considering Quickbooks vs. Xero, one of the first things that you think about is which one is easier to use?

 If you are new to using cloud accounting, Xero can be a more user-friendly choice. The workflow is simple to use and core features like sending invoices and paying bills is quick and easy. For larger businesses, who require a more advanced accounting system, QuickBooks Online may be a better fit. Whilst the learning curve to using QuickBooks Online can be more challenging, you may find that QuickBooks Online offers more flexibility. Both Xero and QuickBooks can be integrated with your job management system, including ServiceM8! This gives you a complete end to end solution for your business.

From invoicing to reports, we have looked at some of the most commonly used features to help you with your Quickbooks vs. Xero decision. There are advantages to using both systems, yet we recommend that Xero is a better choice for small businesses and start-ups as it is easy to use, meaning that you can quickly get going. QuickBooks Online, on the other hand,  is better suited to larger or medium-sized businesses or those who are more established as it offers more capabilities but comes with a steeper learning curve.

For more on this topic, check out our step by step guide to Deciding On Digital Finance and Operations Systems


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