Xero vs Wave (2026): Which Accounting Software Should You Use?

A feature-by-feature comparison of Xero and Wave for small businesses, covering pricing, invoicing, payroll, and which one makes sense for your team.

Updated 2026-09 · 2026

Xero

Cloud accounting for growing small businesses

$20-$80month

Strengths

+Deep double-entry accounting with strong reporting
+Huge app marketplace (1,000+ integrations)
+Multi-currency support built into all plans

Weaknesses

-No free tier — paid from day one
-Payroll is a separate paid add-on (via Gusto in the US)
-Learning curve for non-accountants

Best for

Small businesses with an accountant/bookkeeper, multi-currency needs, or plans to scale past a handful of clients.

Wave

Free accounting and invoicing for small businesses

$0-$16month

Strengths

+Core accounting, invoicing, and receipt scanning are free
+Unlimited invoices and bank/credit card transactions on free tier
+Simple, clean interface with almost no learning curve

Weaknesses

-No inventory management
-Limited third-party integrations compared to Xero
-No project/job costing tools

Best for

Freelancers, solopreneurs, and very small businesses that just need invoicing and basic bookkeeping without a monthly bill.

Feature Comparison

Feature	Xero	Wave
Free plan	No	Yes (accounting + invoicing)
Starting price	$20/mo (Early)	$0 (Pro plan $16/mo)
Invoicing	Yes, all plans	Yes, unlimited on free plan
Bank reconciliation	Yes, all plans	Yes, free plan
Multi-currency	Yes, all plans	No (single currency)
Inventory tracking	Yes (Growing/Established)	No
Payroll	Add-on via Gusto (paid)	Add-on, limited states/provinces (paid)
Payment processing	Via Stripe/GoCardless integration	Wave Payments, 2.9%+$0.60 per transaction
Third-party app marketplace	1,000+ integrations	Very limited
Project/job tracking	Yes (paid plans)	No
Mobile app	Yes	Yes
Multi-user access	Yes, unlimited users all plans	Yes, unlimited users free

The Verdict

Wave wins on pure cost — it's genuinely free for invoicing and bookkeeping, which is more than enough for freelancers and single-owner businesses. Xero is worth the $20-80/month once you need multi-currency, inventory, project tracking, or a real accountant/bookkeeper workflow with app integrations. Don't switch to Wave if you're already relying on Xero's ecosystem of integrations — you'll lose most of them.

How to switch from Xero to Wave

1Export your Chart of Accounts, Trial Balance, and Aged Receivables/Payables reports from Xero as CSV files (Accounting > Reports), and export your Contacts list and invoice history from the Contacts and Sales tabs as CSV.
2Create a free Wave account and set up your business profile, then manually recreate your Chart of Accounts to match Xero's structure (Wave uses a simpler default chart, so map accounts carefully).
3Import your customer/vendor contacts into Wave using its CSV import tool under Sales > Customers, then re-enter outstanding invoices and bills manually since Wave doesn't support bulk invoice import.
4Reconnect your bank and credit card accounts in Wave (Banking > Bank Accounts) to start automatic transaction syncing going forward instead of relying on historical Xero data.
5Rebuild any recurring invoices, payment reminders, and Stripe/PayPal payment links inside Wave since Xero automations and third-party app connections won't carry over.
6Run both systems in parallel for one billing cycle, reconcile the closing balances match, then cancel your Xero subscription once your team confirms Wave has everything needed.

Xero vs Wave: common questions

How do I export my data from Xero before switching to Wave?+

In Xero, go to Accounting > Reports and export your Chart of Accounts, Trial Balance, and Aged Receivables/Payables as CSV or Excel files. You can also export your full contact list and invoice history from the Contacts and Sales sections as CSV. There's no one-click 'export everything' button, so budget time to pull each report separately.

What features do I lose moving from Xero to Wave?+

You'll lose multi-currency accounting, inventory tracking, project/job costing, and most third-party integrations since Wave's app ecosystem is much smaller. If you use Xero's deeper reporting (like budget variance or tracked categories across multiple dimensions), Wave's reporting is more basic in comparison.

Is Wave's free plan actually enough for a small team?+

For a small team that just needs invoicing, expense tracking, and basic bookkeeping, yes — the free plan has no limits on invoices, users, or bank transactions. If you need payroll or in-person/online card payments, those cost extra, and you'll want to check Wave Payroll's state/province availability first since it's not offered everywhere.

Does Wave integrate with the tools I already use?+

Wave has far fewer integrations than Xero — it connects to PayPal, Etsy, Shopify (via third-party sync tools), and Zapier for basic automation, but it doesn't have Xero's 1,000+ app marketplace. If you rely on niche integrations (inventory, CRM sync, advanced payroll), check Wave's integration list before switching.

Will switching to Wave actually save money long-term?+

Yes, for most small businesses — Wave's core accounting stays free indefinitely, while Xero's Established plan runs $80/month ($960/year). The catch is transaction fees: Wave Payments charges 2.9%+$0.60 per card transaction, so if you process a lot of card payments, those fees can offset some of the accounting software savings.