QuickBooks Online and Wave are two of the most notable names in the accounting software business. While we wouldn’t necessarily say that one is objectively better than the other, we would say that one is definitely better for your business than the other. All you have to do is figure out which one.
Don’t worry; we’re here to help. Keep reading for a deep dive into the major differences between Wave Accounting and QuickBooks Online, plus the pros and cons of each cloud-based accounting software.
|Brand name||Starting price||Free trial||Payroll add-on starting base price||Learn more|
|Wave||Free||30 days||$20.00/mo.||Get Started|
|QuickBooks Online||$25.00/mo.||30 days*||$45.00/mo.||Get Started|
Wave Accounting: Most affordable
First things first: Wave’s online accounting software is completely free. Period. You don’t even have to enter a credit card to sign up; just type in your email address, create a user name, and you can get started.
But several other factors set Wave apart, not just its (lack of) pricing:
- Easy-to-read dashboard
- Integration with Shopify, PayPal, ShoeBoxed, and Etsy
- Multiple financial reports, including profit and loss statements, cash flow reports, balance sheets, and sales tax reports
- Unlimited bank and credit card connections
- Journal entry creation
- Unlimited customized invoices
- Receipt scanning with automatic account syncing
- Expense and income tracking
- Multiple users with different levels of access
Wave’s totally free software also includes features that other accounting solutions charge extra for. For instance, FreshBooks’ cheapest plan doesn’t include recurring invoicing—but with Wave, automatic recurring invoicing is built in.
Wave Apps offers three completely free products: Wave Accounting, Wave Invoicing, and Wave Receipts. Wave Invoicing and Wave Receipts have mobile apps for both iOS and Android. And all three products work together seamlessly; for instance, when you scan a receipt, it’ll sync instantly to your Wave Accounting dashboard for easy reconciliation and record keeping.
Wave’s extreme affordability, easy invoicing, and receipt scanning make it a perfect choice for freelancers and solopreneurs. But the software can work well for service-based small businesses too—it’s easy to share your Wave account with other business members, or even with your accountant or bookkeeper come tax time.
As the account owner, you control user permissions and determine who can view, edit, or own different aspects of your financial records. As far as we can tell, there isn’t a limit to how many team members you can invite, which makes Wave perfect for collaboration.
- No cost for most services
- Access for multiple users
- Positive customer ratings
- No mileage tracking
- No inventory management
- No mobile app for accounting or payroll
Wave’s accounting software does, of course, have some downsides. For one, it lacks some features competitors (most notably QuickBooks) add in, like mileage tracking and inventory management. And since it offers only one plan, it’s not as scalable for growing businesses; the plan you see is the plan you’ll get with no options for upgrades that could accommodate larger companies.
Not every small-business owner needs payroll processing, but if you do, it’s nice to know you can easily integrate Wave’s free accounting software with its payroll plans. Alas, Wave Payroll isn’t free—most good payroll software isn’t, with one or two notable exceptions—but with a self-service plan starting at $20 a month (with $6 a month per employee paid), it’s pretty darn affordable.
Like most accounting software providers right now, Wave Accounting has put together some resources to help small-business owners weather the COVID-19 crisis.
Depending on where you live, you might be able to get Wave’s full-service payroll plan instead. It’s available in 14 states and counting, but if you live in one of those states, you can’t choose the cheaper self-service plan instead. Full-service payroll from Wave starts at $35 a month, and for automatic tax filing and a 100% tax penalty guarantee, that’s not half bad.
QuickBooks Online: Most comprehensive
QuickBooks Online has millions of users,1 which makes sense given that its parent company, Intuit, has been around since 1983. In fact, so many bookkeepers and accountants use QuickBooks that it’s almost easier to use the software just because your bookkeeper does.
But there are plenty of perks to QuickBooks Online besides its popularity. Each QuickBooks plan includes the basics:
- Mileage tracking
- Income and expense tracking
- Estimates, invoicing, and payments
- Automatic sales tax tracking
With the higher-cost plans, you get even more comprehensive features:
- Time tracking
- Recurring payments
- Check printing
- Inventory tracking
These features do come at a hefty cost, though. QuickBooks’ cheapest plan, Simple Start, costs $25 a month and allows for only one user. The next step up, Essentials, costs $40 a month and includes three users. The Plus plan starts at $70 and maxes out at five users. It’s also the only plan to include inventory tracking.
No matter which plan you end up with, you can look forward to a super intuitive, user-friendly interface that pretty much lacks a learning curve. While Wave’s dashboard can take a minute to get accustomed to, QuickBooks’ is smooth and streamlined, and its mobile accounting app is at least as good (Wave doesn’t have an accounting app yet—just apps for invoicing and receipt scanning).
Plus, if you don’t need all the bells and whistles of a higher-priced QuickBooks plan, you can always opt for QuickBooks Self-Employed instead. With this $15-a-month plan—temporarily $1 a month for the next 12 months if you sign up now—you can send simple invoices, track mileage, and get quarterly tax estimates to make end-of-year tax payments easier.
- Mileage and inventory tracking
- User-friendly interface
- Integration with other Intuit products
- Limited users
- Mixed customer service ratings
- Higher cost
QuickBooks’ main downside is its cost. Wave does almost everything QuickBooks Online Simple Start does for absolutely free, and since the minimum annual amount you’ll pay for Simple Start is $300, that’s a big fiscal consideration for a business owner. And thanks to its limited user number, QuickBooks doesn’t allow for Wave’s easy collaboration.
Payroll is one area where Wave wins big over QuickBooks no matter how you slice it. QuickBooks Payroll starts at $45 a month, $10 more than Wave’s full-service plan, and it doesn’t include a tax penalty guarantee. That means that even though QuickBooks’ payroll service is responsible for calculating and filing your payroll taxes, the company won’t take the hit from the IRS for a mistake. Instead, your business will, unless you pay $125 a month for the most expensive plan. We have one word for that: yikes.
Did you take out a Paycheck Protection Program loan to cover employee paychecks during the COVID-19 crisis? QuickBooks’ handy guide explains how to hasten the PPP loan forgiveness process.
Like Wave, QuickBooks Online is cloud-based, meaning all your information is stored in the cloud where it’s both secure and easy to share with your accountant and bookkeeper. In contrast, old-school QuickBooks Desktop is software that you download directly onto your computer. Instead of paying for a monthly subscription, you’ll pay an up-front yearly cost, which can range anywhere from $299.95 to $1,213.
Depending on the plan, you might get a few more features than you do with QuickBooks Online, including forecasting, packing and shipping, and access for up to 30 users. But QuickBooks Online is a much more flexible program—it does basically the same thing as QuickBooks Desktop with easier, more convenient user access.
Here’s the good news: both companies offer 30-day free trials so you can take their software for a spin (with Wave, the free trial applies to the payroll plan; you can’t really offer a free trial on completely free software). If reading our comparison tipped you in either direction, feel free to check out that free trial before you commit—it’s great to be absolutely certain of your software before you go all in.
Looking for a QuickBooks alternative other than Wave? Check out some other options in our best accounting software article.
At Business.org, our research is meant to offer general product and service recommendations. We don’t guarantee that our suggestions will work best for each individual or business, so consider your unique needs when choosing products and services.
1. QuickBooks, “QBO Surpasses 2 Million Global Customer Milestone.” Accessed August 8, 2020.