Bookkeeping can be a time-consuming process, especially for self-employed individuals, who often juggle their core business activities with a multitude of administrative tasks. When you rely on manual bookkeeping, processes like tracking transactions across multiple clients, reconciling books with bank statements, and calculating tax estimates can take time and energy away from actual revenue-generating work.
Whether you do your own bookkeeping or outsource services to professionals, it helps to use bookkeeping software. Automating common bookkeeping tasks helps you or your bookkeeper save time while improving the timeliness and accuracy of your books.
Below, we describe the benefits of using self-employed bookkeeping software, what features to look for, and the top programs in today’s market.
| Software | Price | G2 User Rating |
 Visit FreshBooks | $21 monthlyAdditional tiers: $38, $65, and custom pricing | ★★★★ 4.5 out of 5 (based on 900+ reviews) |
| Verdict: Best for freelancers and solo ecommerce business owners | ||
 Visit Wave | $0 monthlyAdditional tiers: $16 monthly | ★★★★ 4.3 out of 5 (based on 200+ reviews) |
| Verdict: Best free self-employed bookkeeping software | ||
 Visit QuickBooks | $20 monthlyAdditional tiers: $35 monthly | ★★★★ 4.0 out of 5 (based on 3,000+ reviews) |
| Verdict: Best for outsourced bookkeeping | ||
 Visit TrulySmall Accounting | $20 per monthAdditional package options: $8.99 for invoicing only, $8.99 for expense tracking only | ★★★★ 4.5 out of 5 (based on 50+ reviews) |
| Verdict: Best for ease of use | ||
 Visit Xero | $20 per monthAdditional package options: $47 or $80 monthly | ★★★★ 4.5 out of 5 (based on 700+ reviews) |
| Verdict: Honorable mention | ||
Note: All amounts listed are in USD.
Features to Look for in Self-Employed Bookkeeping Software
On top of core bookkeeping software features like automated expense tracking, bank reconciliation, and financial reporting, self-employed bookkeeping software should offer features that accommodate the unique needs of self-employed individuals. These include invoicing, time-tracking, and integrations with common freelancer software.
Integrations
Self-employed individuals can maximize workflow efficiency by connecting their bookkeeping software with their other digital business tools. Some examples include:
- Banks: For many bookkeeping software, connecting to bank feeds is a given. This lets you automatically record transactions and perform bank reconciliations.
- Payment apps: Connecting with payment apps like PayPal, Zelle, and Venmo spares you from having to manually record transactions that occur outside your bank feeds.
- Sales channels: Similar to the above, linking your bookkeeping software to sales channels like Amazon, eBay, and Shopify will help you streamline sales tracking.
- Time-tracking: You can connect with time-tracking software like Clockify and QuickBooks Time to track billable hours. This helps you accurately estimate upcoming income and profitability.
Separation of Business and Personal Accounts
Self-employed individuals are not legally required to separate their personal and business accounts, including their bank accounts and credit cards. However, the lack of division can make income, expenses, and tax estimates difficult to calculate.
Good bookkeeping software makes it easy to distinguish between different types of transactions. Some let you tag them manually with a click, while others allow you to set custom rules to categorize them automatically as they come in.
Invoicing
Because self-employed individuals rely on client sales for income, their monthly routines consist of regular invoicing. Therefore, the best bookkeeping tools streamline the process by allowing you to create, customize, and send invoices. Once the client has paid, the software should automatically record the income on your books.
Some software also let you track payment statuses, helping you anticipate upcoming revenue for better planning. Others give you the option to send payment reminders to your clients, increasing your likelihood of getting paid on time.
Tracking Billable Hours
Although some bookkeeping software offer integrations with time-tracking software like Clockify, others also offer their own built-in time-tracking features. These let you clock in with a click, then automatically record and calculate your earnings based on billable time. You can also use these features to track billable hours for employees or contractors.
Mileage Tracking
If you travel by car for work, you can benefit from built-in mileage tracking. This feature calculates the tax deductibles you can claim for work-related private vehicle travel expenses. You can also use it to pass the expenses to your client.
Most bookkeeping software allow you to add trips manually. Meanwhile, programs with more advanced tech can track your mileage manually using your phone’s GPS tracking feature. Then, you can categorize trips as business expenses to record them in your books.
Receipt Scanning
Most bookkeeping software track expenses through bank feed imports or connections. However, not all banks provide detailed information about your transactions. A good bookkeeping software will also provide receipt scanning, letting you add information about each expense for more accurate and comprehensive organization.
Device Availability
Unlike traditional office workers or brick-and-mortar establishments, self-employed individuals are rarely bound to a single location. Even if you are, you still benefit from cloud technology, which gives you access to your financial data anytime, anywhere. The best software stores your data on the cloud and offers browser, desktop, and mobile apps, so you can manage your books on the go.
Multi-User Access
Even if you work solo, it’s best to look for a bookkeeping software that allows multiple users per account. This lets you give access to accountants, bookkeepers, or team members—without sharing sensitive info like your password. The best bookkeeping tools also let you set user permissions, so you stay in control of who can view or edit your financial data.
User-Friendliness
As a self-employed individual juggling many tasks, you don’t have time to learn complicated software. Good bookkeeping tools should be easy to navigate, allowing you and your team to jump in with little friction. Make sure they also offer resources, such as FAQs, help centers, and video tutorials, to help keep you up to speed.
Customer Support
Some software issues are too complex for the available training resources to cover. To ensure that someone can accommodate your needs when problems arise, look for a bookkeeping software that provides adequate customer support. Good bookkeeping software companies offer support through a wide range of channels, including email, chat, and phone.
Best Bookkeeping Software for Self-Employed Individuals
The best bookkeeping software can accommodate the needs of the typical freelancer within a reasonable budget. Below are our top picks for the best bookkeeping software for self-employed individuals.
FreshBooks: Best Overall Self-Employed Bookkeeping Software
| Summary | |
| FreshBooks has the best of all worlds: affordable pricing, comprehensive features, ease of use, and scalability. Its built-in time tracking and project billing features make it particularly suitable for self-employed individuals. | |
| Pros | Cons |
| ✔️ Built-in time tracking and project billing ✔️ Payment reminders and online payment options ✔️ Expense tracking and receipt uploads | ❌ No inventory or product tracking ❌ Limited ecommerce platform integration |
Basic Features
FreshBooks is designed with simplicity in mind for solo business owners. Its packages let you:
- Send invoices to 5, 50, or unlimited clients, depending on plan
- Track income and expenses in real time
- Accept payments via credit cards and bank transfers (ACH)
- Create custom invoices, proposals, and estimates
- Generate time-tracking and tax-time reports
- Capture and store receipts by photo
- Give accountants secure access to your books
- Automate late payment reminders
| Lite | Plus | Premium |
| $21 per month | $38 per month | $65 per month |
| Invoice up to 5 clientsReal-time expense trackingACH payments | Up to 50 clientsTime trackingFinancial reportsReceipt capture | Unlimited clientsProject profitabilityCustom templatesACH + card payments |
Out of all the options in the accounting software market, FreshBooks is the best overall accounting software for self-employed individuals. The features that set it apart from other choices are mileage-tracking, time-tracking, and client communication, which come built-in with all types of plans.
FreshBooks’ time tracking feature lets you log hours as you work. It automatically calculates billable time and adds the amount to your client invoices. You can track time directly from popular project management tools, including Asana, Basecamp, Trello, and Teamwork—and even use a Google Chrome extension for added convenience.
It also automatically tracks mileage. Each time you drive your car for business, the app logs your mileage, automatically calculating billable miles so you can submit the amounts as tax deductions or business reimbursements.
Other useful FreshBooks features include the bookkeeping essentials: automated expense tracking, invoicing, tax-time report generation, and payment acceptance. However, receipt capture and comprehensive financial reports are only available for higher-tier accounts.
The cheapest package, called FreshBooks Lite, only allows you to invoice up to 5 clients. The next highest tier, called FreshBooks Plus, allows free invoicing for up to 50 clients, while FreshBooks Premium offers unlimited invoicing. You get the best value for money if you are a project-based freelancer with few clients.
Wave: Best Free Self-Employed Bookkeeping Software
| Summary | |
| Wave is excellent for the self-employed individual on a budget. While the free plan lacks mileage tracking, time-tracking, and automated categorization, it offers all essential self-employed bookkeeping features, including expense tracking, invoicing, and payment acceptance. | |
| Pros | Cons |
| ✔️ Free to use ✔️ Simple dashboard for cash flow management ✔️ Supports unlimited invoices, estimates, and bookkeeping records ✔️ Multi-business support | ❌ No built-in mileage tracking ❌ No built-in time-tracking ❌No automated categorizations for free account |
Basic Features
Because Wave’s Starter Plan is free, it’s suitable for beginners and new self-employed individuals. The platform allows you to:
- Create unlimited invoices, estimates, and bills
- Record bookkeeping entries for income and expenses
- Accept online payments with transaction fees (2.9% + $0.60 for credit cards)
- Use mobile apps for invoicing and cash flow tracking
- View sales tax info (entered manually)
- Access customer records and overdue invoice alerts
- See financial reports like profit & loss on a single dashboard
| Starter | Essentials |
| Free | $16 per month / $170 per year |
| Unlimited invoicing and estimatesBasic reportsManual tax tracking | Starter features Auto-import bank data, transaction categorization, and remindersDigitally capture unlimited receipts |
As a self-employed individual, you don’t want to shell out too much money on complicated software that does more than what you need it to do. That’s why Wave is one of the best self-employed accounting software options: it provides everything self-employed individuals need for free, without unnecessary bells and whistles.
The Starter plan includes self-employed essentials: unlimited bookkeeping records, custom invoicing, and online payment acceptance. It also uses your bookkeeping data to generate key financial reports, such as profit and loss statements.
The caveat of the Starter plan is a lack of automated bookkeeping features, which forces you to manually import your bank feeds and categorize transactions. This makes it ill-suited to self-employed individuals with high activity.
If the Starter plan cannot meet your needs, consider upgrading to Wave Essentials. At just $16 per month, Wave Essentials automates redundant bookkeeping tasks, such as bank feed imports, transaction categorization, and late payment reminders. It also offers unlimited digital receipt capture for more in-depth bookkeeping organization.
QuickBooks: Best for Outsourced Bookkeeping
| Summary | |
| As one of the leading names in accounting software, QuickBooks is trusted and known by the majority of accountants and bookkeepers worldwide, making it the best choice for outsourced bookkeeping. It also offers two self-employed bookkeeping packages, which cover all bookkeeping essentials plus mileage tracking and invoicing. | |
| Pros | Cons |
| ✔️ Used by most accountants and bookkeepers ✔️ Option to separate business and personal expenses ✔️ Built-in mileage tracking ✔️ Good reporting features | ❌ No free plan ❌ Takes time to learn for beginners |
Basic Features
There are two types of QuickBooks plans that are suitable for self-employed individuals: the $20-per-month QuickBooks Solopreneur and the $35-per-month Simple Start. QuickBooks Solopreneur offers the following features:
- Auto-categorizes business and personal transactions
- Syncs with your business bank account and tracks all deposits and expenses
- Customizable rules for automated categorizations
- Send customized invoices and accept online payments
- Flags potential tax-deductible expenses
- Automated sales tax calculation
- Generates key reports like Profit & Loss, Balance Sheet, and Expense Summary
- Mileage tracking
- Accountant access
| Solopreneur | Simple Start |
| $20 per month | $35 per month |
| Track income and expensesInvoicing and paymentsSales tax trackingEstimatesReceipt captureMileage trackingAutomatic business and personal separation | Solopreneur features (except automatic business and personal separation)Bookkeeping automationConnect 1 sales channelBill management |
QuickBooks is one of the most widely used accounting platforms, making it a strong choice for outsourced bookkeeping. Its longstanding popularity means that most accountants and bookkeepers are already familiar with it, which makes finding and onboarding external talent easier.
However, if you plan to manage your own bookkeeping, QuickBooks is still a solid option. It offers a wide selection of product plans, accommodating businesses of all scales. The best starting points for self-employed individuals are QuickBooks Solopreneur, which costs $20 per month, and QuickBooks Simple Start, which costs $35 per month.
QuickBooks Solopreneur is designed specifically for freelancers, self-employed individuals, and contractors. It comes with all the features self-employed individuals need, including automated income and expense tracking, reporting, invoicing, online payment acceptance, and mileage tracking.
One standout feature is its ability to separate business and personal expenses—a common challenge for many self-employed individuals. Like all QuickBooks plans, Solopreneur connects to your bank accounts and automatically tracks transactions. Even if you don’t have a separate business bank account, the software lets you automatically categorize personal and business spending, helping you keep your finances organized.
However, what QuickBooks Solopreneur lacks is advanced automation features. If you’re looking to streamline repetitive bookkeeping tasks, you might consider upgrading to QuickBooks Simple Start. It includes automation features that allow you to set custom rules for categorizing recurring transactions, saving time, and reducing manual work.
Simple Start also supports integration with one sales channel—Amazon, Shopify, or eBay. This connection helps reconcile your sales platform payouts with your bank deposits, automatically separating out revenue, taxes, and fees for greater clarity.
Another useful feature is its bill management capability. This feature lets you organize business bills, making it easier for you to monitor the details of upcoming payments.
Xero
TrulySmall Accounting: Best for Ease of Use
| Summary | |
| TrulySmall Accounting is the best accounting solution for self-employed individuals with no prior accounting knowledge. Its extremely intuitive design allows beginners to begin their accounting journey with the least friction possible. | |
| Pros | Cons |
| ✔️ Clean interface ✔️ Bulk reconciliation tools ✔️ Supports multi-currency accounting and inventory management | ❌ No multi-business support ❌ No free plan available |
Basic Features
TrulySmall Accounting costs $20 per month and offers the following features:
- Automatically categorizes and posts bank transactions
- OCR receipt capture and matching
- Send invoices, check statuses, and automatically reconcile paid invoices in bookkeeping records
- Generate reports in five minutes or less
- Accepts online invoice payments
- Track sales tax
- Multi-currency support
- Mobile and Android app
| TrulySmall Accounting | TrulySmall Invoicing | TrulySmall Expenses |
| $20 per month | $8.99 per month | $8.99 per month |
| Automate accounting processSend invoicesTrack income & expensesTrack sales taxEssential reportingTrue double entry ledgerFree mobile appIRS/CRA standard chart of accounts | Send invoices and estimatesAccept digital paymentsAutomatic remindersInvoice status updatesFree mobile appSync to TrulySmall Accounting | Automate expense recordingImport receipts via OCRTrack budget and spendingFree mobile appSeparate personal & businessSync to TrulySmall Accounting |
Everything about TrulySmall Accounting was designed for ease of use. The website even claims that 70% of users had no prior accounting experience, and that 80% were surprised by how easy the software was to use. This makes it suitable for self-employed individuals, who likely have less time to teach themselves the ins and outs of new software.
Like most good self-employed accounting software, TrulySmall Accounting automatically records, categorizes, and posts transactions from your bank feeds. You’re sure to never miss a tax deductible, as the software uses IRS and CRA-approved categories to categorize transactions. You can also create custom rules to control how recurring transactions are sorted.
TrulySmall Accounting also offers excellent invoicing features. Not only can it generate and send invoices, but it also automatically records paid invoices into your bookkeeping system, ensuring that you never miss a payment. It also sends payment reminders to your clients before invoice due dates.
TrulySmall also offers smaller and cheaper packages for individuals with less complex needs. There’s TrulySmall Invoicing, which only includes invoicing and payments, and TrulySmall Expenses, which only includes expense tracking and reporting. Either package costs only $8.99 per month.
Xero: Honorable Mention
| Summary | |
| Xero is another popular accounting software. | |
| Pros | Cons |
| ✔️ Extremely easy to use ✔️ Organizes expenses according to IRS and CRA rules using machine learning ✔️ Community group available ✔️ Live support available | ❌ Only 20 invoices per month for starter plan ❌ No free plan available |
Xero offers a full set of self-employed bookkeeping tools, including:
- Sending invoices and quotes
- Entering and reconciling bills and bank transactions
- Capturing receipts and bills with Hubdoc
- Managing cash flow and tracking business performance
- Automating bill payments and viewing of payment timelines
- Setting up W-9 and 1099 forms for contractors
- Tracking and calculating sales tax
- Using multi-currency accounts for international clients
- Claiming business expenses and reimbursements
- Adding inventory tracking with optional add-on
- Getting short-term financial snapshots and projections
| Early | Growing | Established |
| $20 per month | $47 per month | $80 per month |
| 20 invoices/quotes5 billsBank reconciliationBasic reporting | Unlimited invoicesExpense captureShort-term cash flow tracking | Multi-currency supportProject trackingExpense claims,Inventory (add-on) |
While Xero isn’t the best at any crucial area, it’s still a solid option. Like QuickBooks, Xero sees widespread use in the accounting community and would make a great choice for outsourced bookkeeping. Like FreshBooks, it offers a comprehensive set of features and an easy-to-navigate interface.
Xero comes with all the self-employed bookkeeping essentials: bank reconciliation, invoicing, reporting, and tax calculation. It also provides easy receipt capture through an integration with Hubdoc, allowing you to attach receipts to your bookkeeping records.
The main issue with Xero is that the starter plan can be a little limiting. For a fee of $20 per month, you only get 20 free invoices and 5 bill payments. The next highest tier, which offers unlimited invoices, costs more than twice as much. Additionally, its project tracking features, which include time tracking features, are only available with the highest-tier plan, which costs a whopping $80.
Why Use Bookkeeping Software Over Spreadsheets?
Many small business owners, contractors, and sole proprietors use tools like Microsoft Excel or Google Sheets to handle their bookkeeping. They’re flexible and easy to use, making them excellent stopgap bookkeeping solutions. However, because they aren’t built specifically for bookkeeping, they can end up slowing you down and taking time away from higher-impact business activities.
If you’re looking to save time and streamline your finances, it’s worth switching to dedicated bookkeeping software. Tools like QuickBooks, Xero, and FreshBooks link to your accounts and automatically track and organize your transactions, reducing the manual load of bookkeeping tasks while keeping your records accurate and up-to-date.
Benefits of Self-Employed Bookkeeping Software
Automating bookkeeping tasks yields your practice a cascade of benefits. Not only does it help you save time and energy, but it also improves your ability to draw insights from financial data.
Saving time
The most obvious benefit of automated bookkeeping is time savings. Although it can take a while to teach yourself or your bookkeeper the ins and outs of a dedicated bookkeeping software, the hours you reclaim later on make the investment worthwhile. Automated expense tracking spares you from the tedium of manually updating books or spreadsheets, empowering you to prioritize your core business activities.
Increasing accuracy
Bookkeeping tools allow automated imports from outside sources, including spreadsheets, invoices, and bank or credit card statements. Some also sync directly with your bank or credit card feeds, keeping your books up-to-date with minimal effort.
Automation eliminates the risks of human error and delayed reporting. Your data is always accurate and up-to-date, improving the quality of your future analyses.
Generating financial insights
As your bookkeeping software collects data, you gain a clearer picture of your key financial metrics, such as revenue, expenses, and customer purchase rates. You can turn to historical data when gauging overall performance, identifying trends and patterns, forecasting future scenarios, and predicting outcomes.
Some self-employed bookkeeping software also offer data visualization and reporting tools, which present your numbers as intuitive charts and graphs. The visual format makes information readable at a glance, which helps you generate deeper and more timely financial insights.
Outsource Self-Employed Bookkeeping through EpicBooks
Although most self-employed individuals pride themselves on their independence, wearing too many administrative hats can lead to burnout. If you want every facet of your operation to run smoothly, you need to be mindful about how you distribute your time and energy.
Bookkeeping is not a burden you need to bear on your own. To lighten your load, consider working with the experts at EpicBooks, who are eager to support your financial management journey at a reasonable cost. Our self-employed bookkeeping packages cover a comprehensive selection of services, including expense tracking, cash flow management, and tax preparation.
