Small business accounting software cost runs from about $300 a year for an entry plan to over $1,000 for a mid tier, at two major vendors' October 2026 list prices. Payroll, extra users and automation add-ons raise it further. A sole owner with one account and few invoices can often keep the books in a spreadsheet instead.
What does small business accounting software cost per year?
Accounting software for a small business is sold as a monthly subscription, so the yearly cost is the monthly price times twelve, less any opening discount. At the prices listed in October 2026, entry plans from two well-known vendors came to roughly $320 to $460 a year, and the tiers most growing firms land on came to $700 to $1,700.
The table below converts the monthly prices on the Xero US pricing page and the QuickBooks Online pricing page into a yearly figure. Prices are in US dollars, as listed when this post was written, and both vendors change them from time to time, so check the page before you buy.
| Plan (as listed, October 2026) | Monthly list price | Yearly at list price | Users or limits mentioned |
|---|---|---|---|
| Xero Early | $27 | $324 | 20 invoices and 5 bills |
| Xero Growing | $59 | $708 | No invoice limit stated |
| Xero Established | $97 | $1,164 | Adds projects and expense claims |
| QuickBooks Simple Start | $38 | $456 | 1 user |
| QuickBooks Essentials | $85 | $1,020 | 3 users |
| QuickBooks Plus | $140 | $1,680 | 5 users |
| QuickBooks Advanced | $340 | $4,080 | 25 users |
QuickBooks also listed a free plan for one user at the time. Free plans tend to be narrow, so read what it leaves out before you count on it for a full year of books.
Treat these figures as the floor, not the bill. Most owners pay the plan price plus at least one add-on, and the cheapest tier often has a limit that a busy month will hit.
Accounting software plan tiers and the limits that push you up
Accounting software tiers differ mainly in limits: how many invoices you can send, how many bills you can enter, how many people can log in, and whether features such as project tracking are included. You move up a tier when your business hits one of those limits, not because the cheaper plan stopped working.
The Xero Early plan is a clear example. Its listed limit was 20 invoices and 5 bills. A freelancer who bills four clients a month fits easily. A trades business that sends a small invoice for every job may hit 20 by the third week, and the next tier more than doubles the yearly price.
User counts work the same way. A plan that allows one user is fine for a sole owner. Add a part-time assistant or give a spouse access and you may need a plan with three users, even though the books themselves have not grown.
Questions to ask before choosing a tier
- How many invoices did you send in your busiest month last year?
- How many supplier bills do you enter, rather than pay by card?
- Who else needs to log in, and does an accountant's login count as a user?
- Do you need to track time or costs per project?
If the honest answer to the last three is "none", the entry plan, or no software at all, may be the right size.
Add-ons that raise the accounting software bill
Add-ons are paid extras that sit on top of the plan price, and they are where a modest software bill grows. Payroll is the largest. Automation features, extra bank feeds and payment processing fees add smaller amounts that still add up over twelve months.
On the Xero page, payroll was listed at $36 a month plus $6 for each employee or contractor. For one employee that is $42 a month, or $504 a year, on top of the plan. An auto-reconcile feature was listed at $5 a month as an option on the entry plan and included on the higher ones. QuickBooks listed automated bill payments at $0.50 per standard ACH payment over the monthly allowance.
A worked example shows how quickly this moves. Take a sole owner on Xero Early who adds auto-reconcile and pays one contractor through payroll. The figures are an example using the listed prices:
- Plan: $27 a month.
- Auto-reconcile: $5 a month.
- Payroll with one contractor: $36 plus $6, so $42 a month.
- Total: $74 a month, or $888 a year.
That is close to three times the plan price on its own. Before adding any extra, ask whether it replaces work you would otherwise pay for, or only saves a few minutes you would not miss. Payment processing fees for card payments from clients come on top, because they are charged per transaction rather than per month.
Accounting software discounts in year one versus year two
Accounting software is usually sold with an opening discount, so the first year costs less than every year after it. Both pricing pages offered reduced prices for the first three months. Budget for the full price from month four, because that is what you will pay for as long as you stay.
On the Xero page, the Early plan was $5.40 a month for the first three months, then $27. QuickBooks listed 50% off its paid plans for three months. Here is the effect on the two entry plans, using those listed prices:
| Entry plan (example) | First year with promotion | Second year at list price |
|---|---|---|
| Xero Early | 3 × $5.40 + 9 × $27 = $259.20 | $324.00 |
| QuickBooks Simple Start | 3 × $19 + 9 × $38 = $399.00 | $456.00 |
The gap grows with the tier. On QuickBooks Plus the same promotion gives a first year of 3 × $70 + 9 × $140 = $1,470, so the bill rises by $210 in year two.
Price changes are the other thing to watch. Subscriptions are repriced from time to time, and an existing customer usually gets an email rather than a choice. Set a reminder for the renewal month and look at the current price before it renews.
Is a spreadsheet cheaper than accounting software for a sole owner?
A spreadsheet is cheaper than accounting software for a sole owner whose business runs through one bank account, sends a handful of invoices and has no employees. The workbook costs nothing if you already have Excel or use Google Sheets. What it costs is your time each month, plus whatever you pay to get statement rows into it.
Here is an example comparison for one year, assuming twelve monthly statements of under ten pages each:
| Option (example) | Yearly cost | What you do yourself |
|---|---|---|
| Xero Early at list price | $324 | Categorize bank feed rows |
| QuickBooks Simple Start at list price | $456 | Categorize bank feed rows |
| Spreadsheet plus downloaded CSV files | $0 | Paste, categorize, check balance |
| Spreadsheet plus converted PDF statements | about $30 | Paste, categorize, check balance |
The last row uses early pricing from CheapBankConvert, which is not open yet: three bundles of five statements at $9.99 each cover twelve months. If your bank lets you download CSV files for every month, you need no converter at all. The CheapBankConvert homepage explains the per-statement prices and the free two-page preview.
The spreadsheet route only works if the account holds business money alone. Mixed accounts turn every month into a sorting job. How to separate personal and business expenses covers that split, and whether you need a business bank account explains when a second account is required and what it costs.
Accounting software spending mistake: paying for features a sole owner never opens
The most common way to overpay for accounting software is buying a tier for features you will not use. Inventory, multi-currency, project costing and purchase orders are useful for some firms. A sole consultant or a small online seller with simple stock may never open them, but pays for them every month.
Look at the last three months of activity before you pick a plan. Count the invoices you sent, the bills you entered and the people who needed access. Choose the lowest tier that fits those numbers with some room, and move up only when you hit a limit.
Seats are a related trap. Some owners add a login for every person who might one day look at the books, then find themselves on a three-user plan for one person's work. The QuickBooks page listed accountant access separately from its user counts, so check whether your accountant needs a paid seat at all before you buy a tier for them.
A second mistake is paying for the software and then using it like a spreadsheet: importing a bank file once a quarter, categorizing in a rush, and never using the invoicing or reconciliation that justify the price. If that describes your year, the workbook would have given you the same books for less.
A third is handing the job off by email. Owners who keep a workbook sometimes send statements to a helper or an accountant as attachments. Read whether it is safe to email bank statements before you make that a monthly habit, and share files through an account you control where you can.