Last updated May 2016.

I embarked on an intense quest this year to streamline the invoicing and accounting workflow for my freelance business. I was tracking time in spreadsheets, totaling my invoices by hand, and tracking my expenses by shoving them into the digital equivalent of a shoebox. When it came time to file taxes each year, my records were scattered all over the place, so I wasted a lot of time tracking down receipts and getting them organized to file a return.

With the wide variety of solutions available today for time tracking, billing, expense tracking, and accounting, I thought to myself there’s no excuse not to have all of this automated. After doing a serious amount of research into the different solutions available, I realized that other freelancers or small business owners might find this information helpful as well, so I’ve compiled my results into this post. Feel free to skip to the bottom where I’ve assembled my data into an easy-to-read table. My criteria for evaluating these solutions consisted of price, ease of use, and features. The features I specifically wanted were:

  1. Full invoice branding and customization. Branding is important for every business, freelancers included. When I decided to get serious about my freelance business, I invested some time in creating a letterhead and invoice template using Adobe InDesign. However, while InDesign is an excellent tool for creating beautiful documents, using it to calculate (by hand) and format invoices on a regular basis was slow and error-prone.
  2. Time tracking features or integration with 3rd party time trackers. I have many clients that I bill by the hour, so I wanted an invoicing solution that made that process fast and easy. Keeping track of start and stop times in a spreadsheet worked for a while, but it quickly became unreliable and cumbersome for me. I needed a tool that would allow me to clock in and out and to associate the time entries with different clients or projects. Equally important was the ability to track time on the go via a mobile application. Ideally, I could copy my time entries directly to my invoices with one click. Many invoicing and accounting apps have such a feature built in. Others feature integration with dedicated time trackers like Toggl or Timely. Update: Later in my search, I decided that my best bet would be to embrace the “Do One Thing and Do It Well” principle of the Unix Philosophy in my search for software solutions. Currently, I’m using Toggl for time tracking.
  3. Expense tracking and re-billing. My past system consisted of filing away receipts for business expenses with Gmail labels, scanning receipts and stashing them in a folder, and tagging transactions on Mint. When it came time to rebill expenses to clients or total up my deductions during tax season, I was spending far too much time digging through unorganized records and project notes to find the receipts I needed.
  4. Strong reliance on established accounting principles. I expect the accounting software I use for my business to implement a proper double-entry bookkeeping system. Used by accountants and bookkeepers for literally hundreds of years, it’s the standard for a reason. Some solutions try a more simplistic approach, but frequently these products can’t scale as the business grows. Others try to abstract it away, but they don’t always succeed.
  5. Flexible payment terms. I work with clients on a variety of payment schedules. Because of that, I need software that gracefully handles advance or retainer payments toward a client’s account. I also looked into whether each solution supported more advanced schedules, such as giving a small discount to a client who pays early (often referred to in Net D shorthand, such as “2% 10 net 30”, which means an invoice is due in 30 days, but a 2% discount is given if paid within 10).

QuickBooks

QuickBooks Mac Desktop

QuickBooks Mac
Cost: $300, one-time purchase

Ease of Use: 4/10

Intuit’s QuickBooks has been the heavyweight champion of accounting software for years, so it’s with them that I started my search. Since a new edition comes out yearly, the price of staying up to date comes out to about $25 per month. Since I use a Mac, I was only able to try out the Mac edition. There are a few differences between platforms, as I found out.

Right away, QuickBooks on the desktop shows off its power, and also its complexity. It’s certainly possible for non-accountants to use this software, but it takes some patience or some specialized training. It came with a lot of features I wasn’t interested in, such as payroll and inventory management, but it’s not too much trouble to navigate around those features.

I was very pleased with the invoice and form customization available in Quickbooks’ Mac Edition, which includes a built-in layout designer with intuitive drag-and-drop editing.

For time tracking, Intuit has a free companion app to their Quickbooks Mac software called MyTime. I found it intuitive and well-made, but it’s limited to local time tracking only. If you want to track time on the go, you’ll need to keep track of it separately.

Features like the 2% 10 NET 30 payment terms or advance retainers are built in with great support.

QuickBooks Mac did fall short in a couple areas. I was going through the process of entering in the data about my various services offered when I discovered they don’t allow you to set different price levels for the same service, a feature available in the Windows version.

For me, the real deal-breaker was in QuickBooks Mac’s scant 3rd party service integrations. First of all, the offerings of compatible services for something like “better time tracking” were pretty lackluster. While QuickBooks for Windows does ship with some integration APIs (the QuickBooks SDKDesktop REST API, and Intuit Sync Manager), QuickBooks for Mac lacks any sort of integration API to speak of. Even on the Windows platform, Intuit is retiring their Desktop REST API and Sync Manager in favor of pushing vendors to integrate with QuickBooks Online. This indicates to me that the ecosystem around the Quickbooks Desktop apps might die over the next couple years, which makes it seem unwise to build any new business processes around it. This may even indicate the Intuit intends to discontinue development completely on their QuickBooks Desktop line of products. Not a great sign.

QuickBooks Online

QuickBooks Online
Cost: Starts around $13 per month, though sales are frequent

Ease of Use: 10/10

So Intuit appears to be shuttering their desktop line of QuickBooks apps in favor of the new, popular SaaS cloud accounting option, QuickBooks Online. They have a free trial, but perhaps even more helpful if you’re evaluating their software is the online test drive where you can click their app without signing up.

QuickBooks Online is a far more streamlined product than Intuit’s desktop offerings, and it’s one that’s definitely marketed at a different audience. While QuickBooks Desktop generally seems targeted at large businesses, accounting firms, and enterprise users, QuickBooks Online seems to lean more toward small business owners (and even freelancers). The UI is far more streamlined and modern, and feels pretty easy to use. It’s also cheaper at the entry level.

So where did it fall short? The level of invoice customization offered in QuickBooks Online was a huge disappointment. Can you swap out some text or add your own logo? Sure. Can you move elements around on the page or really make it yours at the same level that Adobe InDesign or QuickBooks Desktop would allow you to do? Absolutely not.

QuickBooks Online Plus ($40 per month) includes some timesheet entry tools for employees, and there are numerous time trackers integrations for QuickBooks Online as well. I found that their built-in tools were targeted at a team of employees working on a small number of tasks throughout the week, whereas as I needed a tool that worked well for a single employee working on a wide variety of tasks for various clients.

I looked into some of the 3rd party services time-tracking integrations as well, but none met my needs either. It seems like most of the apps on the marketplace are either too expensive for a freelancer or looked too enterprisey (or just plain junky) to be of help. Tsheets seems to be the leading solution for time tracking that integrates with QuickBooks Online, and especially after their recent app redesign, they seem to have a pretty good product. When I tried out their app in 2015, my impression was similar to the one I got from QuickBooks’ native time tracking: probably works well for a large team, but not as effective for a single-employee business.

I also tried out the Toggl Integration by Apigrate. While it succeeded at exporting my Toggl time entries to QuickBooks, it was rather clunky. The synchronization could only process each time entry once (ignoring subsequent changes), ran on a rather aggressive schedule that sometimes led to unpredictable results, and couldn’t load more than a couple weeks of historical data, making my initial task of billing for a previous month’s work rather frustrating. It also required the Plus version of Quickbooks, in addition to its own monthly fee, which made the whole setup rather expensive.

I interacted with Intuit’s staff a few times, and they were generally responsive and helpful. At one point, I spoke to a sales rep to understand their various offerings and try to figure out which product they offer that would serve all of my needs. They ended up recommending QuickBooks Enterprise in the cloud, and set up a demo instance for me. It looked like a version of QuickBooks Desktop for Windows running in a remote desktop session through the web browser, which seemed a bit of a letdown. Later, when I spoke with their customer service about a refund after deciding QuickBooks Online Plus wasn’t for me, the reps were very friendly and helpful (though it took a couple calls to resolve the issue).

FreshBooks

FreshBooks

(The FreshBooks links are affiliate links. They help me support myself and my blog.)

Cost: ~$10+ per month

Ease of Use: 6/10

FreshBooks is another big player in the cloud accounting space these days. They are a direct competitor to QuickBooks Online, also targeting the small-business-owner and freelancer crowd

FreshBooks offers a full range of invoicing, expense tracking, time tracking, and accounting tools, with a pretty attractive interface to top it all off. They have a wide array of 3rd-party integrations as well, and these are tools I might actually want to use and have heard of, such as BaseCamp, ZenDesk, Toggl, Mailchimp, the Envato Marketplace, and WooCommerce, to name a few.

I tried FreshBooks’ free trial very briefly. The interface felt dated and clunky, and the software didn’t seem particularly powerful.

They proudly proclaim “Yes, you can customize your invoices!”, and then proceed to explain that the logo at the top can be swapped out, a few colors can be changed, and you can enter some custom terms at the bottom. Seriously? That hardly qualifies as invoice customization, in my opinion. At least their built-in templates look pretty nice.

Features such as advanced payments for a retainer seem a little workaround-y. Oddly enough, while FreshBooks seems to be fully aware and supportive of trying terms like the early payment discount (2% 10 NET 30) on their blog, they don’t support it natively in their software. It can be managed by manually applying such a credit to a customer’s account, however.

Check out a detailed breakdown of Freshbooks’ features (in comparison to Harvest) over at Othermachines‘ blog.

FreeAgent

FreeAgent
Cost: $24 per month

Ease of Use: 8/10

FreeAgent is accounting software built especially for freelancers, so it’s no surprise that a lot of freelancers highly recommend it.

They have all of the standard features one would expect, from invoicing to expense tracking to bank account synchronization. They also integrate with a fair number of 3rd party services.

FreeAgent’s built-in invoice templates look pretty nice, and their customization features are pretty good as well. FreeAgent uses HTML to generate your invoices, and they allow you to customize those invoices with CSS. This offers a lot of flexibility, and as a developer I feel right at home in such an environment. While not everyone knows CSS, this is probably the next best option after allowing users to customize their invoices directly with a WYSIWYG editor.

They also have an excellent time tracker built in which allows you to organize your timeslips by project and task and to assign a comment to each. While their mobile app doesn’t include time tracking, their site is responsive and allows you to log time on the go via your mobile web browser.

The expense tracking is robust and supports common workflows such as re-billing expenses to clients.

I tried their 30 day free trial and came very close to adopting it into my permanent list of tools. However, there were a few pain points in their service that ultimately led me to continue my search. Mainly, I discovered that they were sorely lacking in many of the advanced features I was looking for. For instance, I wanted to bill one client on a retainer, against which I would apply billable time each month. I discovered that this was not really possible. It’s been a feature request on their community support forums for several years, and some users have come up with some decent workarounds involving fake bank accounts or dummy invoices, but I can’t stand such a messy workflow. Early payment discounts were also requested several times several years ago, and there has been no action from the company on these features since then.

The 4-year-old feature requests really make me wonder if they are still actively improving their product. If not, and they don’t support everything I needed out of the box, I feel that I can’t expect it to get much better than it already is.

While FreeAgent technically relies on double-entry accounting on the back end (while abstracting away most of it from the user), I found it difficult to use their interface for entering journal entries while trying to move funds around the different accounts on my balance sheet.

Harvest

Harvest

(The Harvest links are referral links.)

Cost: Free, paid plans start at $12 per month

Ease of Use: 8/10

Harvest is another crowd favorite among the freelance crowd, and for good reason. Their product is focused and well-executed for what it is.

Primarily, Harvest’s focus is on helping you track your time and expenses for projects and then billing clients for it. If all you need is a simple tool to automate this part of your workflow, they could be a great option for you. Even if you need more than what Harvest provides, they offer a large number of 3rd-party integrations including Quickbooks Online and Xero. The company itself is nimble, and the product is seeing pretty consistent new improvements.

So for Harvest’s narrow feature set, how do they do?

The time-tracking features in Harvest’s web application are robust, and they offer a full line of mobile apps (including for Apple Watch) so that you can track time on the go. They even support time tracking for multiple team members for those who are running bigger enterprises than a one-person shop.

Harvest’s invoice management features are great as well. With only a couple clicks, they will help you include un-billed hours and expenses on an invoice. They can even automatically generate such a report and send it to your client on a recurring basis. Retainers are supported natively, a big plus. However, early payment discounts are not.

Sadly, Harvest supports no invoice branding or customization beyond your company logo. And like I mentioned earlier, if you want a proper accounting solution you end up paying for another solution on top of this one.

Thrive Solo

Thrive Solo
Cost: $15 per month

Ease of Use: 10/10

Thrive Solo and its sister product Thrive Team are relative newcomers to the space. These products are highly specialized and are targeted not just at freelancers but at creative professionals specifically. This shows with an interface that is clean, easy to use, and built with a strong focus on aesthetics.

Thrive Solo bills itself primarily as project management software with integrated invoicing and time tracking functionality. I really appreciate the project planning tools, analytics, and business intelligence features.

The time tracking tools are web only with no companion mobile apps as other services offer. Invoices from Thrive Solo look pretty nice by default but offer no customization beyond uploading your own logo.

They support expense tracking and re-billing, but advanced workflows such as retainers or early payment discounts are nowhere to be found. Thrive Solo offers no true accounting functionality, and there are no third-party integrations to fill in the gaps in features.

Billings Pro

Billings Pro
Cost: $5 per month

Ease of Use: 5/10

Billings Pro, a suite of applications for Mac and iOS by Marketcircle, and its predecessor Billings, has been a valuable part of the business toolkit for freelancers and small businesses (and especially graphic designers) for several years.

While Billings Pro is not a full accounting system, it is a versatile piece of software with a diverse feature set that came very close to meeting all of my needs.

Notably, Billings Pro is the only software I reviewed besides QuickBooks Mac that featured a drag-and-drop WYSIWYG invoice template designer. Place elements exactly where they need to be on the page, change the fonts, even add new columns to the table of line items. It’s really a designer’s dream come true.

Billings Pro includes integrated time tracking tools for both their Mac application and their iOS phone/tablet/watch application. They are certainly comprehensive, but in practice I found it a bit difficult to understand how they wanted me to organize my timeslips. On the plus side, they integrate a timer right into your OS X menu bar, which is great for quickly clocking in and out without interrupting your primary tasks.

Billings Pro includes expense logging and re-billing, and also natively supports the ability to apply retainers toward your various client accounts. If you need more advanced accounting functionality, Billings Pro integrates with an edition of QuickBooks Mac or Moneyworks running on the same machine. If you need project management tools, Billings Pro integrates with Marketcircle’s other application Daylite.

Sadly, I wasn’t able to try out most of these features, as the application crashed frequently and then eventually refused to establish a connection with their cloud server to fetch my account data. Their customer support team was responsive, but ultimately we weren’t able to resolve the issues before I gave up and moved on.

Pancake

Pancake
Cost: $150

Ease of Use: 7/10

Pancake is unique in that it is a self-hosted solution that runs on your own web server under PHP and MySQL. Their software license permits modifications to the source code as well, so it really is the most customizable solution I have seen yet, if you are a savvy developer and have the time. They have an online demo that you can access without signing up for anything, which is great.

While Pancake is not a complete accounting system, it has a pretty big list of features, including invoicing, time tracking, expense tracking, and project management. It also includes a set of client-facing tools that allow your clients to log on to your server and view their past invoices, the status of their projects, and more.

Pancake doesn’t do too well when it comes to the advanced features I was looking for. Invoice template customization via the UI is lacking, and I wasn’t really interested in diving into the code to make this happen. Time tracking on the go can be accomplished through the web browser (the design is responsive), but there are no native apps to perform this task.

Xero

Xero

(The Xero links are affiliate links. They help me support myself and my blog.)

Cost: $9 per month

Ease of Use: 8/10

Xero has been on the market for quite a few years but is still often thought of a relative newcomer when compared with some of the more entrenched products like QuickBooks and FreshBooks. This New Zealand-based company has built one of the most fully-featured accounting solutions around. I used it for several months. It isn’t flashy, but it does a good job of putting an easy-to-manage layer of abstraction over the top of a powerful double-entry accounting system. The features for managing accounts and generating invoices are rich, powerful, and easy to use, though the UI feels a little sluggish and dated at times.

Xero’s invoices aren’t particularly pretty out of the box, but they advertise full customization and branding of invoices and other forms via DOCX templates generated by Microsoft Word. This sounds great in theory. However, as the old cliche goes, a chain is only as strong as its weakest link, so this means the usability of this feature is only as good as Microsoft Word itself (or the open-source LibreOffice, if you prefer). This leads to a pretty frustrating workflow for invoice customization, as any designer who has ever tried to do proper desktop publishing on MS Word can tell you. Even after I struggled through the infuriating process of porting my InDesign templates over to Word (which took many hours), I found that the invoices generated using the uploaded templates were completely garbled and unusable. Furthermore, you are limited to using only the terrible fonts that come with Windows Server 2008.

Xero doesn’t include any built-in time-tracking tools, but it does integrate with a wide range of 3rd party services. Represented among those are more time trackers can I can count, though many of them have that same “enterprise” stink that a lot of the apps in the Intuit marketplace have.

Xero doesn’t support early payment discounts on its invoices, but they have at least supplied a workaround to have the discounted total auto-calculated and displayed on the client’s invoice.

Xero offers a pretty wide range of reports, but I found them rather confusing and never succeeded at getting anything useful from them.

Wave

Wave
Cost: Free

Ease of Use: 9/10

Wave’s suite of free online applications are fairly popular, and it’s not hard to see why. For very small businesses or those just starting out, the straightforward, no-nonsense free pricetag is a huge plus. The tools they offer, while limited, are solid.

Wave is built on a proper double-entry accounting system at its core, but they make their accounting tools are pretty easy to use. Tracking expenses and sending invoices is pretty straightforward. Tasks such as re-billing expenses to clients are possible but aren’t exactly user-friendly.

Wave trades power for simplicity. If you want full customization of invoices, look elsewhere. Time tracking is completely absent. Wave integrates with only a handful of 3rd party services: PayPal, Shoeboxed, and Etsy. Ultimately, they were far too simplistic for my needs.

Zoho Books

Zoho Books Dashboard

Cost: Starts at $9 per month

Ease of Use: 9/10

Behind Zoho Books’ clean, simple, and responsive user interface is an application that packs a lot of power under the hood. It features a full double-entry accounting system, which, while normally abstracted away for the day-to-day tasks, is readily accessible at a lower level in the “Accountant” tab. The reports are diverse, but easy to read. During tax season, I found the reporting feature to be helpful for breaking my expenses down and getting everything organized, so I consider that a success.

I was impressed by the level of invoice customization available. While you can’t make freeform layout adjustments using the invoice editor, you can edit the styles of almost any part of your invoices or certain other documents. There isn’t a huge selection of fonts, but at least you have Helvetica and Open Sans as options so that your invoice looks modern. If you make a request to the customer service team (which was easy to do with their overlaid chat box), they will enable an HTML editor for your invoice templates as well, allowing you to make any sort of design customizations you like.

Zoho Books includes a time tracking feature that allows you to associate time entries with projects and projects with clients, and then include project time entries on your invoices. The time tracking is also available using their mobile app (which sends invoices effortless too). I found the time tracking and project management feature a bit clunky though. Like some of the other solutions, the time tracking doesn’t seem particularly suited to working on a large variety of tasks throughout the day; tasks must be input ahead of time and they all go into the same list. At the moment I’m still inputting that data into my invoices by hand, then.

The expense logging feature is robust and includes a file upload for the receipt scans. Expenses are easily re-billed to clients as line items on invoices as well. First-class support for retainers and advance payment is included too, which is great news.

Comparison Table

Product Starting Price Ease of Use / UI Invoice Customization Time Tracking Mobile Time Tracking Expense Logging Expense Re-billing Retainers Double-Entry Accounting Early Payment Discounts
QuickBooks Mac $299.95 / one time 4/10 Full (WYSIWYG) Yes No Yes Yes Manually Yes Yes, natively
QuickBooks Online $8 / month 10/10 Limited Via 3rd party Via 3rd party Yes Yes Manually Yes No
FreshBooks $9.95 / month 10/10 Limited Yes Yes, via native app Yes Yes Manually No No
FreeAgent $24 / month 8/10 Full (CSS) Yes Yes, via mobile browser Yes Yes No Yes No
Harvest Free 8/10 Logo only Yes Yes, via native app Yes Yes Yes Via 3rd party No
Thrive Solo $15 / month 10/10 Logo only Yes Yes, via mobile browser Yes Yes No No No
Billings Pro $5 / month 5/10 Full (WYSIWYG) Yes Yes, via native app Yes Yes Yes Via 3rd party No
Pancake $149 / one time 7/10 Full (CSS, HTML, PHP) Yes Yes, via mobile browser Yes Yes No No No
Xero $9 / month 8/10 Full (DOCX) Via 3rd party Via 3rd party Yes Yes Manually Yes Somewhat, via workaround
Wave Free 9/10 Limited No No Yes Yes Manually Yes No
Zoho Books $9 / month 9/10 Full (HTML or WYSIWYG) Yes Yes Yes Yes Yes Yes No

Conclusion

I still haven’t found a product or collection of products I’m totally satisfied with.

I am, however, very happy with Toggl for time tracking at the moment. I mainly appreciate the ubiquity of its client apps. They have a web application, a browser extension that integrates time tracking into numerous different productivity applications, a desktop app to track time from my OS X menu bar, and a slick iOS app. Toggl makes it really easy to track time from anywhere. Their reports are easy to work with, too, so the process of bringing time entries to other applications is not too painful any more.

For a while, Xero was my winner for accounting, but I never did get their invoice templates to work correctly, leaving me to continue processing them by hand. Eventually I jumped ship for Zoho Books, which is where I am now. They do about 90% of what I want, so that’s probably the best there is for me for now. Sadly, there aren’t any integrations between these platforms, so I’m still left doing a lot of the data entry by hand.

There are also quite a few other software packages I didn’t cover in this article that I looked over during my research: Invoicera, Hiveage, ProWorkFlow, Kashflow, Margn/ERPLY Books, FrontAccounting, LessAccounting, Sage One, and MoneyWorks.

What do you use to manage your invoicing and accounting for your business? Leave me a note in the comments. Also let me know if I got any of my details wrong, or if you’d like to me to add any other apps to my roundup!