The short answer: For a 5-person team, QuickBooks Online Plus runs $140/month ($1,680/year) while Xero Growing runs $59/month ($708/year) — a $972/year gap that widens with every hire, because QuickBooks bills by user count (1/3/5/25 users per tier) while Xero doesn’t bill by users at all. The subscription price is only the start: Intuit has raised QBO prices nearly every year since 2021, payroll is a separate per-employee charge on both platforms, and your accountant’s preference can cost more than the software itself.
Subscription math compounds across your whole stack. Our [SaaS true-cost calculator](/software/saas-true-cost/) models the three-year cost — uplifts, add-ons, and all — and our payroll software pricing guide covers the payroll line item this guide doesn’t price.
This guide is educational, not financial advice. It compares pricing models — it doesn’t tell you which vendor to buy.
The QuickBooks tax: prices rise almost every year
Intuit’s price history is the single most predictable number in small-business software. Industry reporting (Woodard, checked against archived pricing pages) shows QBO prices rising in 2021, 2022, 2023, 2024, and 2025, with the latest hike hitting renewals on and after August 1, 2026 (Workforce.com, verified October 2026):
| Plan | Early 2026 price | August 1, 2026 price | Increase |
|---|---|---|---|
| Simple Start | $38/mo | $38/mo | none |
| Essentials | $75/mo | $85/mo | +$10/mo |
| Plus | $115/mo | $140/mo | +$25/mo |
| Advanced | $275/mo | $340/mo | +$65/mo |
For perspective: the Plus plan cost $70/month in 2020 and now costs $140 — it has doubled in six years, per the same industry tracking. That’s roughly a 12–17% annual uplift at the higher tiers, not inflation-level drift.
The practical meaning: budget your QBO cost with a 10–15% annual escalation, not today’s sticker. If you can’t afford next year’s price, you can’t afford the plan.
The user-cap cliff: where the pricing models actually differ
QuickBooks limits how many billable users each tier allows; your accountant’s seats don’t count toward the cap (2 accountant seats on lower tiers, 3 on Advanced). Xero has no user limit on any tier — but caps activity on the cheapest one.
| Simple Start | Essentials | Plus | Advanced | |
|---|---|---|---|---|
| QBO price (Oct 2026) | $38/mo | $85/mo | $140/mo | $340/mo |
| Users included | 1 | 3 | 5 | 25 |
| Early | Growing | Established | |
|---|---|---|---|
| Xero price (Oct 2026) | $27/mo | $59/mo | $90/mo |
| Users included | Unlimited | Unlimited | Unlimited |
Two things to know about Xero’s prices: they were $25/$55/$90 through most of 2026, and Xero raised them effective October 1, 2026 (to $27/$59/$97 for new and existing subscribers, per multiple current reviews reading Xero’s own pricing page — note this guide’s figures are post-increase). Xero has also raised prices before; it doesn’t have Intuit’s near-annual cadence, but it’s not immune either.
And one caveat on Xero Early: unlimited users, but limited activity — roughly 20 invoices and 5 bills a month per current reviews. Cross those and you need Growing. If you send 30 invoices a month, Early is not a $27 plan for you; it’s a $59 plan.
The cliff itself: hire your 6th person and QBO Plus no longer holds you — your only option is Advanced at $340/month ($4,080/year), a 2.4× jump for one extra seat. On Xero, your 6th, 12th, and 40th hire change nothing about the subscription. This is the expensive mistake the brief was built to prevent: a business that signs up for Plus at $140/month when it has 4 people and discovers at headcount 6 that its accounting software now costs $4,080 a year.
The add-ons nobody quotes you
The list price buys the ledger. Everything else is sold separately:
- Payroll is a separate per-employee charge on every platform — QuickBooks sells its own payroll plans, Xero’s US payroll runs through a partner (Gusto), and Wave charges a base fee plus per-employee and per-contractor fees. This is a real line item with real traps; we don’t re-explain it here — see the payroll software pricing guide.
- Payment processing (taking card payments on invoices) is priced separately from the accounting subscription, with its own percentage fees.
- Inventory depth: QBO Plus includes inventory and COGS tracking, but Advanced is where the serious automation lives. Xero includes basic inventory on all plans; deeper inventory comes through paid add-ons or its app marketplace.
- Promotional pricing is not your price. Both vendors run aggressive intro promos (50% off for months, deep six-month discounts). Budget on the list price — promos end and renewals don’t.
Rule of thumb: the subscription is roughly half of what the stack costs once payroll and payments are in. Compare platforms on the full stack, not the headline number.
Your accountant’s preference — the hidden line item
Here’s the trap the pricing pages can’t show you: most US accountants default to QuickBooks, and many bill more — or work slower — on anything else. The extra year-end bill from an accountant converting your Xero file can exceed the $972 you saved on the subscription.
This is not an argument against Xero. It’s an argument for making one phone call before you choose: ask your accountant what they use and what they charge for each option. A bookkeeper who lives in Xero makes Xero cheap; an accountant who only touches QBO makes Xero expensive. The compatible answer is whichever one your existing financial help already opens.
The free option: what Wave’s free plan actually gives you
Wave’s Starter plan is still genuinely free — unlimited invoices, bills, and double-entry bookkeeping for $0. But in 2026 the free plan is a manual-entry ledger, not an automation tool, per current reviews:
- Automatic bank imports are paid. The free plan no longer pulls transactions from your bank — you type them in by hand. Bank auto-import sits behind Wave Pro at $19/month (Wave’s own annual option is listed around $190/year).
- Receipt scanning is paid. OCR receipt capture moved off the free tier too.
- Multi-user access is paid. The free plan is effectively single-user; adding your bookkeeper or partner requires Pro.
For a solo operator sending a handful of invoices a month, typing transactions by hand is genuinely fine, and $0 is $0. For a business with steady transaction volume, manual entry is a standing weekly appointment with your own bank statement — the $19/month is really a “buy back your time” fee. Wave is US- and Canada-only, has no real inventory tracking and no time tracking, and Pro support is weekday business hours — once you outgrow those, you’ve outgrown Wave.
The worked 5-user comparison
Rebuilt from October 2026 numbers — list price, no promos:
| QBO Plus | Xero Growing | |
|---|---|---|
| Monthly list | $140 | $59 |
| Annual | $1,680 | $708 |
| Users included | 5 | Unlimited |
| Inventory | Inventory + COGS included | Basic included; advanced via paid add-ons |
| Payroll | Separate, per-employee (see guide) | Separate, via partner (Gusto) |
| Your accountant | Probably already uses it | Ask first — compatibility can cost you |
| Adding a 6th user | Forced to Advanced: $340/mo ($4,080/yr) | Still $59/mo |
The gap: $972/year, growing with every hire.
Honest caveats, because a $972 gap isn’t the whole story:
- If you need deep inventory, QBO Plus/Advanced does more natively than Xero without paid add-ons. Add-ons can close or reverse the gap.
- If your accountant is QBO-only, the file-conversion cost at year-end can eat the savings. Ask before you switch.
- Xero’s ecosystem runs on integrations. Many workflows need paid app-marketplace tools — budget $0–200/month in apps depending on complexity, per current reviews.
- Both raise prices. Intuit nearly annually; Xero just did (October 1, 2026). Neither price is a quote.
The switching math: why you don’t do this mid-tax-year
Switching accounting platforms mid-year means running two systems during the overlap, re-doing bank rules and category mappings, migrating historical data (or paying your accountant to), and handing your accountant a split-year file at tax time. That’s real money on top of the subscription difference.
Do not switch mid-tax-year without the accountant conversation first. The clean move is a year-end cutover, planned with the person who closes your books, with a one- to two-month overlap where both systems run. If the savings justify the move, they justify doing it cleanly. Before you sign anything, price your exit from your current vendor too — export your data, know what format it comes in, and confirm your historical records survive the migration. (This is the software-version of our vendor lock-in guide.)
Methodology
Every price in this guide was re-verified in October 2026 — no figure was carried forward from earlier research. QBO prices ($38/$85/$140/$340) and user caps (1/3/5/25) were corroborated across multiple current comparison pages reading the vendor’s own pricing; the August 1, 2026 increase details come from Workforce.com’s coverage of Intuit’s official FAQ; the “nearly every year since 2021” pattern is attributed to Woodard’s industry reporting, checked against archived pricing pages. Xero’s October 1, 2026 increase ($25/$55/$90 → $27/$59/$97) is attributed to multiple current reviews reading Xero’s own pricing page — a direct fetch of xero.com timed out during verification, so treat the increase as well-corroborated but stamp it and recheck the vendor page at signup. Wave’s free-tier limits come from current 2026 reviews, not Wave’s own page. Promo prices were deliberately excluded everywhere — budget on list price. Figures are stated pre-tax. QuickBooks, Xero, FreshBooks, and Wave all run partner/affiliate programs; terms will be verified at monetization time, affiliate links will be disclosed per the disclosure page, and affiliate availability has not shaped any conclusion here. This guide is educational, not financial advice.
Sources
- QuickBooks Online pricing (quickbooks.intuit.com/pricing — figures corroborated across multiple current comparison pages), verified October 2026
- QBO August 2026 price-increase FAQ coverage — workforce.com, verified October 2026
- QBO 2020–2025 price history — report.woodard.com (via archived pricing pages), verified October 2026
- Xero US pricing — xero.com/us/pricing-plans (direct fetch timed out during verification; figures per ifeeltech.com, baremetrics.com, flozic.ai), verified October 2026
- QBO-vs-Xero user-model comparison — expertereview.xyz, verified October 2026
- Wave Starter/Pro terms — ecommerce-platforms.com, interobservers.com, topconsumerreviews.com, verified October 2026
Frequently asked questions
Should I switch to Xero mid-year to save $972? Not without your accountant’s sign-off, and ideally not mid-tax-year at all. A split-year file, a botched migration, or an accountant who charges extra for non-QBO files can erase the savings in one invoice. Plan a year-end cutover with your accountant if you switch.
My accountant only uses QuickBooks — does that settle it? It settles the price question, not the value question. Ask what they charge for each option before deciding. But a $0/month subscription plus a $500 conversion fee at year-end isn’t cheaper than a $59/month one — do the full-stack math with your accountant’s number in it.
Is Wave’s free plan really free? The ledger is free: unlimited invoices, bills, and double-entry bookkeeping for $0. What’s gone from free is the automation — automatic bank imports, receipt scanning, and multi-user access now sit behind Wave Pro ($19/month). Free means manual entry.
How often does QuickBooks raise prices? Industry reporting shows increases in 2021, 2022, 2023, 2024, 2025, and August 2026 — roughly annually, heaviest at the higher tiers. Plus doubled from $70 to $140 between 2020 and 2026. Budget a 10–15% annual escalation.
Is payroll included in any of these subscription prices? No. Payroll is a separate per-employee charge on every platform. See our payroll software pricing guide for the actual numbers.
Does Xero really let unlimited people use it? Yes — no per-user seat fees on any tier. But the cheapest tier (Early) caps activity (about 20 invoices and 5 bills a month, per current reviews), and features like multi-currency, projects, and expense claims are gated to higher tiers. Unlimited users doesn’t mean unlimited features.