This article is part of a larger series on Accounting Software.
Effective project management and accurate financial tracking are crucial for the success of any business. The best project accounting software combines robust accounting capabilities with powerful tools to help businesses manage their projects and monitor each project’s profitability. It enables businesses to track project costs, allocate resources, create detailed budgets, generate invoices, and analyze financial data—all in one centralized platform.
We evaluated the best project accounting software to help you determine the best solution for your business:
- Zoho Books: Overall best accounting software for tracking project profitability
- QuickBooks Online Plus: Best for project accounting with a huge support network of ProAdvisors
- FreshBooks: Best for service-based projects
- Xero: Best for unlimited users
- QuickBooks Desktop Premier: Best desktop accounting software for tracking project profitability
- Sage Business Cloud: Most affordable with basic project accounting features
Comparison of Project Accounting Software
Number of Users
Track Locations & Classes
Compare Estimated vs Actual Project Costs
Assign Costs to Projects
Accounts Receivable (A/R), Accounts Payable (A/P) & Banking
Ease of Use
$20 to $275 monthly
1 to 15
$90 or $200 monthly
5 or 25
$17 to $55 monthly
$799 to $1,999 annually
1 to 5
$10 or $25 monthly
1 or unlimited
Zoho Books: Best Overall Accounting Software for Tracking Project Profitability
- Free and Standard plans limit the number of invoices you can send
- Project accounting only in paid plans
- Managing unpaid bills is unavailable in Free and Standard plans
- Additional fee for more users
Zoho Books offers a choice of five different subscription plans with project accounting functions. (There is also a free plan for users that earn less than $50,000 in annual revenue, but it doesn’t offer project accounting.) You can sign up for a 14-day free trial with any paid plan:
- Standard: $20 per month for up to three users and 5,000 invoices
- Professional: $50 per month for up to five users and unlimited invoices
- Premium: $70 per month for up to 10 users and unlimited invoices
- Elite: $150 per month for up to 10 users, unlimited invoices, and advanced inventory
- Ultimate: $275 per month for up to 15 users, unlimited invoices, and advanced inventory
- Additional users: $3 per user, per month
- Receipt scanning: $10 for 50 scans per month
- Snail mail credits for sending invoices: $2 per credit
We selected Zoho Books as the overall best accounting software for tracking project profitability because tracking and managing projects are a breeze. It includes all the project accounting features that you would expect to see—including project creation, project estimations, assignment of project costs, allocation of inventory used, and project reporting. It also has a powerful mobile app that allows you to work remotely with access to all the features in its online interface.
Zoho Books received an almost-perfect score in our evaluation of its project accounting feature. The only markdown is its inability to generate a report that compares actual to estimated labor and inventory.
QuickBooks Online Plus: Best for Project Accounting With a Huge Support Network of ProAdvisors
- Requires at least a Plus subscription to track project profitability and inventory
- Unable to enter bills or record time worked through the mobile app
- Requires one subscription per organization
- Can be expensive compared to other software
QuickBooks Online is available in four subscription options—but you’ll need either Plus or Advanced to track costs by project. You can either opt for a 30-day free trial or 50% for three months.
- Plus: $90 per month for up to five users
- Advanced: $200 per month for up to 25 users
One of the advantages of QuickBooks Online is that it gives you access to a large support network of QuickBooks ProAdvisors. It provides a “Find-a-ProAdvisor” directory on its website, where businesses using QuickBooks Online can search for and connect with ProAdvisors who specialize in project accounting or another specific area of expertise. It also excels in project accounting, with features such as time tracking, milestone-based billing, and progress invoicing serving as useful tools. However, just like Zoho Books, it is unable to create a report that compares actual to estimated labor and inventory.
FreshBooks: Best Accounting Software for Service-based Projects
- No expense or income tracking by class
- Lacks inventory management
- Charges a fee for additional users
- Can’t track and reconcile bank accounts without a live bank connection
- Requires pricey Premium plan subscription for more than 50 billable customers
FreshBooks offers a choice of three plans ranging in price from $17 to $55 per month, plus a custom-priced plan. It currently offers a discount of 60% off the first six months for new users. All plans allow you to manage budget and billing for projects, but only the Premium and Select plans let you track project profitability:
- Lite: $17 per month for up to five billable clients
- Plus: $30 per month for up to 50 billable clients
- Premium: $55 per month, unlimited billable clients
- Select: Custom pricing for unlimited billable clients and specialized features
- Additional team members: $11 per person, per month in all plans
- Advanced payments: $20 per month (unavailable in Lite)
We selected FreshBooks as the best accounting software for service-based projects because of its robust project management and time tracking features. It is ideal for small service-based businesses that bill clients based on the time worked by their employees, and one of its most useful features is the ability to compare estimated and actual project costs, which is impossible with software like QuickBooks Online and Zoho Books. However, it is unable to record the actual inventory used in a project.
Xero: Best Project Accounting Software for Unlimited Users
- Only one organization per subscription, with no option to add more
- Lowest plan is limited to 20 invoices and five bills
- No annual billing option for plans
- Not popular in the United States
Xero offers three pricing plans, each of which comes with unlimited users. However, only the Established plan includes project tracking. Before subscribing, you can access all of Xero’s features for free for 30 days:
- Established: $70 per month for unlimited invoices and bills, plus multicurrency, receipt capture, and project tracking
We chose Xero as one of the best project accounting software because of its ability to accommodate unlimited users, and it earned a perfect mark in our evaluation of its project accounting function. It can help you track and pay bills, manage inventory and invoices, claim expenses, and store files. It also has a fixed asset manager—the only one of the software we evaluated that offers this feature—that keeps fixed asset records and calculates depreciation expenses automatically.
QuickBooks Desktop Premier: Best Desktop Accounting Software for Tracking Project Profitability
- Desktop software requires installation
- Not able to manage fixed assets
- Limited to five users
- Higher upfront costs
QuickBooks Desktop Premier 2023 is offered as an annual subscription and is priced based on the number of users.
- $799 per year for one user
- $1,099 per year for two users
- $1,399 per year for three users
- $1,699 per year for four users
- $1,999 per year for five users
If you need more than five users, you’ll need to upgrade to Enterprise. For more information about its different features, read our review of QuickBooks Enterprise.
We selected QuickBooks Desktop Premier as the best desktop accounting software for tracking project profitability because of its robust project accounting features. We gave it a perfect score in this category because of its ability to create estimates, attach items, and allocate costs and estimates to a project. It is better at project accounting than QuickBooks Online because of its ability to compare actual costs to estimates. You can also monitor the progress of the tasks involved in a project and compare your actual to planned costs and progress, so you can easily identify issues that might affect your schedule and budget.
Sage Business Cloud: Most Affordable Software With Basic Project Accounting Features
- Unable to create recurring purchase invoices
- Doesn’t automatically calculate cost of goods sold (COGS) when inventory is sold
- Lacks income and expense tracker by class and a client portal
- Limited integration options
Sage Business Cloud offers two subscription plans, which differ in price based on the number of users, access to real-time reports, and the ability to generate quotes and estimates. You can sign up for a 30-day free trial with no credit card required:
- Sage Accounting Start: $10 per month for one user
- Sage Accounting: $25 per month for unlimited users
We chose Sage Business Cloud as the most affordable software with basic project accounting features because of its ability to create quotes and estimates easily. You can also assign costs and inventory to projects when creating bills and invoices. However, you’re not able to assign estimates to projects, which means you can’t compare budget-to-actual results. Despite that, it is a good option for budget-minded businesses that want access to a well-rounded solution for project accounting.
What Is Project Accounting Software?
Project-based accounting software is designed to help businesses track and manage the financial aspects of their projects. It provides tools and features specifically tailored for project-based businesses, such as professional services firms, construction companies, and consulting agencies. Here are some key features commonly found in project accounting software:
- Project budgeting: This allows you to set project budgets and track expenses against them. It helps in monitoring costs and identifying potential budget overruns.
- Time and expense tracking: Project team members can record their time spent on different tasks and submit expense reports. The data is then used for project costing and billing.
- Invoicing and billing: Project accounting software generates invoices based on project work completed and expenses incurred. It allows you to customize billing rates, create detailed invoices, and track outstanding payments.
- Financial reporting: The software provides comprehensive financial reports—including project profitability, revenue forecasts, cash flow analysis, and project performance metrics. These will help you evaluate a project’s success and make informed business decisions.
- Integration with other systems: Project accounting software often integrates with other business systems like CRM software, enterprise resource planning (ERP) systems, and payroll systems. These integrations ensure smooth data flow and improve overall operational efficiency.
Frequently Asked Questions (FAQs)
Some key benefits of using project accounting software include accurate project costing, streamlined project management, enhanced invoicing and billing, and clear visibility into project financials.
Project accounting software can be beneficial for a wide range of industries, including professional services, construction, engineering, consulting, and information technology (IT) services. It is particularly useful for businesses relying on project-based work, where tracking project costs and profitability is crucial.
Both cloud-based and desktop project accounting software have their advantages. Cloud-based software offers the benefit of remote access, automatic updates, and data backup, while desktop software provides more control over data and potential customization options. The choice depends on your business needs, budget, and IT infrastructure.
The best project-based accounting software combines the power of project management and accounting into a unified solution, allowing businesses to track project income and expenses effectively, streamline workflows, and make informed business decisions. By leveraging these tools, businesses can enhance project profitability, improve financial management, and achieve their business goals more efficiently.