Along with QuickBooks Online, Xero offers some of the best small business accounting software in the game. While you won't get the aesthetically-pleasing dashboard like you do with QuickBooks - nor the generally welcoming feel or user-friendly interface - you will, however, get just about everything else you could possibly need from an accounting program (give or take), and at a very affordable price-point.
Xero, like most small business accounting software, offers three different paid versions (as well as a 30-day free trial for each.) The most basic version is called Starter, offered at a mere $9 per month. Payroll is not supported in this version, but you can still reconcile your bank transactions (up to 20) and create invoices, quotes, and bills (up to five.) This version is certainly not the most comprehensive, but for a small enough business, it just might be enough.
The next version is Standard, offered at $30 per month. Payroll is supported in this version, but only for a maximum of five people. Billing, invoicing, quotes, and bank reconciliation are all unlimited. The most advanced version is Premium, at $70 per month. Premium offers all of the above with the addition of multiple currency support and payroll for up to ten people (payroll for 20 people is available for $90/month, and for 100 at $180/month.)
Xero differs from QuickBooks Online especially in its overall appearance. While QuickBooks Online spans the entire page, Xero is much more compact - it only takes up the center of the screen. If you prefer a no-nonsense look and feel, then Xero is a great option for you.
One of Xero's greatest strengths is that it is specifically designed as a double-entry accounting software - this cannot be said of many others. Xero also excels in its reports; not only does it offer a wide range of types of reports, but they are also all extremely customizable. Integrated payroll is also included with Xero (but keep in mind it is only available in 36 states, whereas with QuickBooks Online it's available in all 50.)
Out of almost all accounting software, Xero is probably the best at invoicing. Not only are invoices incredibly easy to generate, but you also have the option of creating recurring invoices, sending reminders to customers about any overdue invoices, and sending statements directly. Invoices will also show you if the invoice has been seen by the customer, which is a feature unique to Xero.
Sales tax functionality is another one of Xero's greatest strengths. By using a customer's geographic location, Xero will find the correct sales tax rate and automatically input it. This makes it incredibly easy to file sales tax reports on Xero.
Xero's downsides are few and far between, however, it should be mentioned that it lacks time-tracking and project-tracking abilities, which can be a deal-breaker for a lot of businesses.
That said, Xero's strengths are numerous, and indeed, much more could certainly be said for its state of the art inventory tracking, extremely thorough contact records, well-integrated third-party applications, and its excellent help section (however, no phone support.)
It's hard to go wrong with Xero.
See our selection for Best Accounting Software.