Xero and QuickBooks Online are both strong cloud accounting platforms. QuickBooks Online has the largest user base in the US and strong US payroll and sales tax tools; Xero is especially popular in the UK, Australia and New Zealand, and its plans don't limit the number of users. The right choice depends on your country, integrations, number of users and accountant's preference.
Choosing accounting software is a decision you'll live with for years. Here's how the two leading cloud platforms compare.
Side-by-side comparison
| Xero | QuickBooks Online | |
|---|---|---|
| Strongest markets | UK, Australia, New Zealand | USA, Canada |
| Users | No user limit on plans | User limits vary by plan |
| Bank feeds | Strong | Strong |
| Payroll | Via add-ons or local payroll (varies by country) | Built-in options in the US and Canada |
| Sales tax / VAT | MTD VAT; integrations for US sales tax | US sales tax automation; MTD VAT in the UK |
| App marketplace | Large | Large |
| Multi-currency | Higher-tier plans | Higher-tier plans |
Choose Xero if…
- You're UK based or operate across several countries
- Many team members need access
- You rely heavily on third-party apps
Choose QuickBooks Online if…
- You're US or Canada based and want built-in payroll
- Your accountant or bookkeeper works mainly in QuickBooks
- You want native US sales tax features
What matters more than the software
- A clean chart of accounts that matches how you report
- Bank feeds and rules set up properly
- Integrations with your ecommerce, payments, CRM and payroll systems
- A monthly close routine
How Avore Solutions can help
We set up, migrate and manage Xero and QuickBooks bookkeeping, and connect them to your other systems through API integrations. Ask us which fits you.
Frequently asked questions
Are Xero and QuickBooks MTD compatible?
Yes. Both Xero and QuickBooks Online can submit VAT returns under the UK's Making Tax Digital rules.
Which handles multi-currency better?
Both offer multi-currency on higher-tier plans. Compare how each handles foreign currency bank accounts, revaluations and reporting for your situation.
Can I switch from QuickBooks to Xero, or vice versa?
Yes. Migration tools and conversion services exist for both directions. Plan the switch for a period end, such as a quarter or year end, to keep reporting clean.