Accounting Software: QuickBooks Online vs Wave Accounting
Well, there are a lot of different options for accounting Software today. We will discuss the differences between QuickBooks Online and Wave Accounting. Waterford Business Solutions focuses on QuickBooks Online, but this does not mean it is the right fit for every business. Wave offers solutions for those who need a low-cost or entry-level platform. It offers many benefits for basic accounting.
Wave was founded in 2010 and quickly gained popularity because it is one of the very few that offer a free plan. However, the free version of the platform is very basic, so today we will discuss their pro-level platform, since there are more comparisons.
Prices vs Features
To start, we know how important cost is to clients, so since QuickBooks Online Simple Start is their lowest tier, we would recommend it. It starts at $39.00 a month, twice the price of the lowest tier at $19.00. And while you would save money, you have to weigh the pros and cons.
With QuickBooks Online, you get many app integrations, so you can use various dispatching software, such as HouseCall Pro and Service Titan. You can also use a project management platform. Those don’t always integrate as well with a simple start, but it is an option you have for a comparable-priced version of QuickBooks.
Wave offers minimal integration options because it lacks an open API that allows third parties to integrate. They are a single platform with only their own add-ons; to integrate with other software, you will have to use something like Zapier. They make their money with these add-ons. You are required to use their payment processor when invoicing, which is a good amount of revenue for them alone.
If you are looking for software that will allow you to code transactions and send off data to your CPA for tax purposes, this is the one for you. Simple Start with QuickBooks will allow you to do the same and go a step further by creating an ecosystem.
Reporting Comparison:
There are some serious limitations with the reporting options in Wave. There are 15 reports even in the higher tier level. Of course, this includes key reports such as the Profit and Loss Statement and Balance Sheet. You can get more details in the trial balance and general ledger for tax purposes, but you will not have the wide variety that QuickBooks offers.
If you are invoicing through Wave, you will have an A/R report; however, if you are using other invoicing software, you will not. Your A/R report will be wildly inaccurate. This goes back to how important the ecosystem QBO offers is, because it allows the AR to integrate with and reflect in QBO for any outstanding invoices.
Wave is very AI-driven, while QuickBooks is still rolling out many of its AI updates. As far as categorization goes, QuickBooks will look at 3 data points. Historical categorizing, current bank feed, and the bank statement are used to determine where the transaction should go.
Payroll Software
Wave does offer its own payroll solution at a lower price point than QuickBooks Online. Wave Payroll starts at $40 per month plus $6 per employee and $6 per contractor. QuickBooks Payroll starts at $50 per month plus $6.50 per employee and $3 per contractor. Both platforms will calculate, file, and pay payroll taxes on your behalf, making either one a solid option for businesses looking to simplify payroll.
One notable difference is that Wave does not currently offer built-in 1099 filing, which may be a drawback for businesses that regularly work with independent contractors.
Scalability and Business Growth
Where Wave really begins to fall short is in scalability. The Pro plan is essentially the highest level the platform offers. If you’re starting a business with plans to grow, you’ll eventually outgrow what Wave can provide.
Wave is designed for straightforward bookkeeping. As your business expands, you may find yourself needing features such as:
- Project or job costing
- Accounts payable and bill pay workflows
- Advanced inventory management
- Third-party software integrations
- More robust financial reporting
Unfortunately, these capabilities simply aren’t available within Wave.
QuickBooks Online takes a different approach. You can start with Simple Start while you’re getting your business off the ground and then seamlessly upgrade to Essentials, Plus, or Advanced as your needs evolve. Your historical data remains intact, and you simply unlock additional features instead of migrating to an entirely new accounting system.
This flexibility allows businesses to grow without the disruption and expense of changing accounting platforms later.
The Cost of Outgrowing Your Software
One of the biggest considerations when choosing accounting software isn’t where your business is today—it’s where you expect it to be in the next three to five years.
At first glance, Wave’s lower monthly cost is attractive. For many startups, saving $20 each month makes perfect sense.
However, once your business reaches approximately $500,000 to $1 million in annual revenue, your accounting needs become significantly more complex. Features like job costing, inventory tracking, workflow automation, and software integrations become less of a luxury and more of a necessity.
If you’re already using QuickBooks Online, upgrading is as simple as changing your subscription.
If you’ve built your accounting history inside Wave, upgrading often means migrating to an entirely new accounting platform. That process can require rebuilding workflows, importing historical data, retraining staff, and working through inevitable transition issues. In many cases, businesses lose valuable historical reporting or spend considerable time cleaning up data during the migration.
Planning for future growth today can save significant time and money later.
Which Platform Is Right for You?
Both QuickBooks Online and Wave are capable accounting platforms—they’re simply built for different types of businesses.
Wave is an excellent fit if you are:
- An independent contractor
- A freelancer or a one-person business
- A startup looking for an affordable bookkeeping solution
- Primarily focused on tracking income and expenses for tax purposes.
- Comfortable with a simpler accounting system that doesn’t require many integrations
QuickBooks Online is likely the better choice if you:
- Plan to grow your business over the next several years.
- Need integrations with dispatching, CRM, project management, or other business software.
- Want more advanced reporting capabilities.
- Need job costing, inventory, or project tracking in the future.
- Work closely with an accountant or bookkeeping professional.
- Want a platform that can grow alongside your business without requiring a full migration.
