Due to their time-efficiency and cost-effectiveness, cloud-based accounting softwares have been increasingly in demand over the past few years. These solutions offer many features that most small to medium-sized businesses need and can serve all their accounting purposes. QuickBooks Online by Intuit Inc. and Xero Ltd. are two of the top players in the cloud accounting market and highly-reputed tools in the short-term rental industry.
So, we decided to make a brief comparison of their pricing, accessibility, integrations, customer service and ease of use, hoping that the analysis will come in handy for you to answer the question of Xero vs QuickBooks and decide which one to go with for your vacation rental accounting management.
Xero vs QuickBooks Pricing
Let’s start the comparison with the highest priority, deciding-factor in choosing a service for your business and compare the different pricing plans offered by Xero and QuickBooks.
The ‘Start Plan’ for Xero is £10 per month. This package allows you to send 20 invoices and quotes, five bills, bank reconciliation, MTD VAT and CIS Deductions and reports.
The ‘Standard Plan’ is £24 per month, and this plan allows an unlimited number of invoices and quotes, as well as an unlimited amount of bills.
The ‘Premium Plan’ is £30 per month, and it will provide you with all the services included in the other two plans plus using multiple currencies.
The inventory integration is included in all Xero plans.
QuickBooks plans start from £14 per month. The Simple Plan allows one user to send custom invoices and quotes, prepare self-assessments and MTD VAT submissions. In addition, it offers SmartScan to its users, which checks for errors for VAT Returns. This is an extremely useful feature. It can bring up your exceptions for the period if you have any potential duplications of transactions and your largest income and expense transactions.
It then splits your expenses and income down into the different VAT rates. It can also flag up any inconsistent VAT codes you might have used on income and expenses and the transactions they relate to. You can have your banks and credit cards connected. Also, QuickBooks allows you to photograph receipts through the QuickBooks app. The snapped receipts will come up through the banking tab. You can also use mileage tracking, and this plan will calculate CIS deductions and reports.
The ‘Essentials Plan’ is £21 per month. This package provides three users with insights and reports, employee management and multi-currency features. With the Simple Plan, you can only use expenses, which will deduct the amount straight off your bank account, while the Essentials Plan enables users to set a particular bank account to pay off their bills. This feature can be particularly helpful when you have multiple bank accounts.
The ‘Plus Plan’ is £29 per month. This package allows up to five users to do stock management, make time sheets for employees, create projects and allocate expenses and income to them to help split down profitability.
To do payroll through QuickBooks, you need to pay £4 a month for the Standard package and £1 plus 20% VAT per employee. The Advanced plan’s payroll fee is £8 per month and £1 plus 20% VAT per employee. The Advanced package allows more pay schedules, automatic pay runs, deductions, integration with QuickBooks and reports on Payroll, compared to the Standard package.
QuickBooks has an extra charge for inventory integration.
Xero vs QuickBooks Accessibility
You can restrict access in more detail with Xero. It is easy to stop a user from being able to see banks or invoices. These restrictions on QuickBooks are not as thorough. The minimum restriction you can give is read-only, so users can still access the information you may not want them to see.
Xero allows an unlimited number of users to work with its software in all of the plans, while the number of users is restricted in each plan of QuickBooks.
Xero vs QuickBooks Integrations
Xero and QuickBooks both offer a good number of integrations. However, there is a higher number of integration options with Xero compared to QuickBooks.
Moreover, Xero collaborates with Gusto Payroll, so they offer two months of free integration to Xero customers who want to add on payrolls.
Xero vs QuickBooks Customer Service
Customer service is one of the other critical factors when it comes to choosing a solution over the other for your vacation rental management. Property managers need a piece of software with enough customer service and support agents who can walk them through all the steps of onboarding or installation and provide them with advice on software issues that might occur while using the application.
In the case of customer service, Xero overtakes QuickBooks as it provides its clients with 24/7 online support. QuickBooks only has phone support from 9:00 am to 5:30 pm, Monday to Thursday, and 9:00 am to 4:30 pm on Fridays.
Xero vs QuickBooks Ease of Use
Both QuickBooks and Xero are easy to set up and offer a user-friendly interface and a vast range of banking integrations for many regions.
Xero’s invoice reminders are less time-consuming than those of QuickBooks’. Besides, Xero allows you to apply reminders to all customers, but with QuickBooks, you have to select each customer individually to send reminders for overdue invoices.
Xero has a report for Equity statements while QuickBooks does not offer such an option. This report can show investors the profit and losses.
In Xero, you can have multiple tabs open on the same login, which is extremely useful, for example, when you are creating a bill and need to preview a previous bill. With QuickBooks, you cannot do this within the payroll, banking or taxes tab; otherwise, it will log out of your previous tab. In QuickBooks, you can only open a report in a different tab.
Setting up recurring bills on QuickBooks is a lengthier process, and QuickBooks doesn’t have an option like Xero to pay the bills from the main dashboard. The easiest way to see outstanding invoices in QuickBooks would be to look at each supplier account or run an Accounts Payable Aging Report.
QuickBooks’ journals are more complicated and less user friendly if you are not coming from an accounting background. However, in QuickBooks’ journals, you can Debit and Credit the bank accounts, which is not possible with Xero.
With QuickBooks, Profit and Loss reports can be filtered by each customer or with estimates which do not apply to the same reports on Xero.
Quickbooks and Xero accounting software solutions can streamline the accounting process of short-term rentals. Both of these software providers help busy vacation rental hosts stay on top of numerous day-to-day accounting tasks with no hassle. Nevertheless, they have some subtle differences in pricing, accessibility, integrations, customer service and ease of use. It is on each manager to conduct thorough research based on their business’s particular needs and their preferences to choose one of these reputed tools.
The overall comparison was submitted by JSM but developed and edited by Zeevou.
JSM Partners are a firm of property specialist accountants that only work with property investors. With a significant number of clients in the serviced accommodation sector, they are well-positioned to advise you on a range of issues from bookkeeping through to VAT and inheritance tax.