FreshBooks vs QuickBooks: Key Differences & What’s Best 2022

While both FreshBooks and QuickBooks Online offer rich accounting features, they have significant differences and are built for unique business purposes. FreshBooks is best for small service-based businesses and freelancers needing strong project accounting features. Meanwhile, QuickBooks Online is a great fit for businesses heavily engaged in inventory management.

FreshBooks vs QuickBooks at a Glance

When To Use Each

When To Use an Alternative

• Project accounting with inventory: Project-based businesses needing inventory accounting can use Xero instead. It allows you to compare actual to estimated project expenses while also offering good inventory management features.
• Fixed asset accounting: Neither FreshBooks nor QuickBooks Online has a fixed asset manager. If fixed assets are a big part of your business, you should consider Xero. It can manage and track fixed assets like buildings, vehicles, machinery, and equipment, and calculate depreciation expenses.
• Service-based businesses that need free accounting software: Wave allows you to send quotes, estimates, and invoices, and track expenses for free.

Fit Small Business Case Study

Our case study compares FreshBooks and QuickBooks Online across 11 categories. The results show QuickBooks Online’s excellence in terms of general features, banking and cash management, inventory accounting, and reporting. Conversely, FreshBooks’ mobile app and project accounting features are slightly better than QuickBooks, not to mention it has outstanding customer service. You can check out the detailed results of our case study in our FreshBooks review and QuickBooks Online review.

See the graph below for the summary of our case study.

FreshBooks vs QuickBooks Online: Pricing

If you are a very small business and you work with fewer than five customers, then FreshBooks’s entry-level plan, Lite, might be enough. However, as your business and customer base grows, you might prefer to sign up for QuickBooks Online to save some money on additional users.

FreshBooks vs QuickBooks Online: Features

FreshBooks vs QuickBooks Online: Invoicing

QuickBooks Online and FreshBooks both have excellent invoicing features, but QuickBooks Online stands out with its ability to automatically calculate sales tax rates and apply them to invoices based on the customer address. With FreshBooks, you have to set up the sales tax for each jurisdiction manually. If you collect taxable payments from different jurisdictions, you’ll prefer QuickBooks Online.

FreshBooks vs QuickBooks Online: Banking & Cash Management

If you are comfortable connecting your bank account to your accounting software, then you might consider FreshBooks. However, if you want the option not to connect your account―probably due to security reasons―then you should consider QuickBooks. You’ll also likely prefer QuickBooks if your business relies heavily on paying vendors and employees by check as it can record and print checks.

FreshBooks vs QuickBooks Online: Accounts Payable

Both offer an easy way to record bills and track outstanding bills, but QuickBooks Online has some features that FreshBooks doesn’t. QuickBooks lets you create POs and convert them into bills, enter a vendor credit and apply it when you pay the bill, and pay an independent contractor using the service item you created. If you want a more solid solution to manage your unpaid bills, then choose QuickBooks Online.

FreshBooks vs QuickBooks Online: Inventory Management

Inventory accounting is QuickBooks’ biggest trump card against FreshBooks. FreshBooks lets you add inventory items to bills, but there’s no way to know how much inventory you have available or the cost of your inventory sold. QuickBooks Online’s inventory management system lets you track available inventory, calculate quantities, costs, and prices automatically, and track which of your items are most profitable. If your business is focused on selling products, you should choose QuickBooks Online to support your inventory accounting needs.

FreshBooks vs QuickBooks Online: Project Accounting

Both FreshBooks and QuickBooks Online offer useful project accounting features, but FreshBooks takes it one step further by allowing you to compare estimated to actual project costs. This helps you make better decisions in terms of budgeting and financial management.

FreshBooks vs QuickBooks Online: Ease of Use

FreshBooks and QuickBooks are easy to use, especially if you have accounting experience. Both also include shortcut buttons to help you easily navigate the programs. However, it’s faster to get started with FreshBooks as it only requires minimal information to set up your company—you have to go through a series of steps to set up a company in QuickBooks Online. The good news is that both, depending on your subscription, include unlimited customer support to help you learn everything there is to know about the software.

FreshBooks vs QuickBooks Online: Integrations

The library of integrated apps of both programs should be enough to cover other business processes, like payment processing and payroll. If integration is important to you, both are great choices.

FreshBooks integrates with hundreds of third-party programs. A few include Gusto for payroll, Stripe and PayPal for credit card processing, Bench and Mazuma for bookkeeping, and Shopify and Square for ecommerce.

Meanwhile, in addition to QuickBooks’s integration with native products, such as QuickBooks Payments, QuickBooks Payroll, and QuickBooks Time, —QuickBooks Online connects with more than 650 third-party applications, including Gusto, Stripe, PayPal, Shopify, and Square.

FreshBooks vs QuickBooks Online: Mobile App Functionality

FreshBooks’ mobile app is a little more functional than the one from QuickBooks, but it all comes down to your needs. If you’re doing business with many suppliers and managing project contractors, you’d like the option to record a new bill and enter time worked using FreshBooks. Meanwhile, if you need to process and track incoming transactions from a bank feed, QuickBooks Online’s app comes in handy.

FreshBooks vs QuickBooks Online: Assisted Bookkeeping

QuickBooks Online wins for assisted bookkeeping. It is used by the vast majority of small business owners in the United States, which means that you can find a competent local bookkeeper easily and quickly. Users needing a professional bookkeeping service can add QuickBooks Live to their subscription by turning the feature on in their left menu bar. Through it, you’ll be paired with a dedicated bookkeeper to help you accomplish tedious bookkeeping tasks, like bank account reconciliations and reporting.

In addition to QuickBooks Live, users can work with independent QuickBooks ProAdvisors. QuickBooks Online is a very popular accounting tool that many local bookkeepers will be very familiar with. You’ll be almost certain to find a local QuickBooks ProAdvisor near you.

On the other hand, FreshBooks partners with a third-party online bookkeeping service, Bench, to provide assisted bookkeeping services to users. Depending on your Bench subscription, you’ll get access to a dedicated bookkeeping team, year-end reports, unlimited tax advisory, and one-on-one tax strategy planning.

FreshBooks vs QuickBooks: Customer Support

While both offer several support channels that you can access easily, FreshBooks comes out ahead, primarily because of its live phone support. The ability to make a phone call when encountering serious issues is a huge factor that sets FreshBooks’ customer support apart from QuickBooks.

Bottom Line

If you’re a small business or a solopreneur whose primary focus is to track project profitability and you’re comfortable connecting your bank account, then FreshBooks is for you. However, if you’re looking for more than project management, QuickBooks Online is the best choice. It beats FreshBooks in many aspects of accounting, including inventory tracking, banking and cash management, bill management, invoicing, and income and expense tracking by class.