Xero or Quickbooks Online???

Both are Fantastic!

First of all, I would like to mention that both are fantastic cloud-based accounting systems. They greatly simplify our lives and help us stay organized effectively. We have no intention to promote or criticize either of these products. Instead, we wanted to document this information to assist us in making the right choice for our clients.

Prices - Don't Look at the Discounted Prices

Plans and Pricing for Xero Australia

Plans and Pricing for Quickbooks Australia

As of June 2023

Both companies offer limited-time discounts, but it's important to consider the "original price" as accounting systems are typically used over many years. Additionally, comparing prices directly may not provide a clear indication of which system offers better value, as it depends on individual needs. Allow me to list some additional features and limitations of each product that may influence your decision.

Xero's pricing is based on the entire account, with no user limitations as far as we know. This is advantageous for businesses with multiple individuals involved in the accounting process. If your company has multiple owners, administrators, bookkeepers, accountants, auditors, etc., Xero may be a more cost-effective choice as you can add many users to the account, and their activities can be tracked individually. On the other hand, QuickBooks has strict limitations on the number of users, even with its most expensive plan, allowing only up to 5 users. However, it offers highly flexible user-level settings.

Many small business owners may be interested in expense handling, as it often deters them from managing bookkeeping themselves. Both Xero and QuickBooks offer the ability to submit receipts via email. However, Xero's "Expense" module incurs an additional fee per person, whereas QuickBooks includes the expense module in all its plans. It's worth noting that you can still process expenses on Xero without paying the extra fee by treating them as bills.

Xero's plans include payroll services for a few staff members, whereas QuickBooks requires an additional fee per person for payroll (here is the price list for the additional fees). However, it doesn't necessarily mean that Xero is superior in terms of payroll because its timesheet functionality within the payroll module is basic. If you require advanced features such as timesheet and shift scheduling, you would need to pay for a separate scheduling app, which then charges a monthly fee per staff member.

Attachments - Easy to Migrate?

There is no mention of how each company handles 'Attachments,' but I personally believe that this could be a key factor in selecting an accounting system. Allow me to explain why.

With Xero, attachments such as copies of receipts are attached to each transaction. There is a 'Files' module where you can upload and attach documents and graphics to your bills, for example. However, once an attachment is linked to a transaction, it is moved to another module, such as Bills. This means that downloading them easily when you stop using the system becomes challenging.

While there are third-party applications available to download all attachments, this ultimately poses difficulties for many businesses. Consider the situation when you close down your business—how many additional years would you need to pay to retain all the attachments for accounting purposes?

On the other hand, QuickBooks stores all attachments in a central location called 'Attachments.' When you create expenses based on the attachments, QuickBooks simply inserts links to the expenses. All documents remain in the Attachments module, and you can download them with a single click. While it may still be cumbersome if you have thousands of stored attachments, it could be more efficient than opening each bill individually and downloading each file one by one. However, it's important to be mindful of the file size limits in QuickBooks. Unlike Xero, which doesn't specify a maximum file size limit, QuickBooks does have a storage limit. It may be more suitable for storing documents temporarily, and periodic downloading might be necessary.

Whether Xero or QuickBooks suits you depends entirely on your preferences and requirements.