Xero vs Wave 2026: Free vs Paid, Compared by an Accountant

So, you’re choosing between Xero and Wave. On the surface it’s free versus paid. Underneath, it’s simple invoicing and bookkeeping versus a full accounting system that can grow with you.

I’m an accountant, and I’ve set up both. Below I compare them on what you really pay, bank feeds, invoicing, reporting, ecommerce and growth, using US prices checked this week, so you can see exactly when free stops being enough.

Xero vs Wave at a Glance

The short version: Wave is cheaper and simpler. Xero does more, connects to more and works in more countries.

Xero vs Wave Pricing

Wave pricing

Plan	Price	What you get
Starter	$0	Unlimited invoices, estimates, bills and bookkeeping records; mobile invoicing
Pro	$19/month or $190/year	Adds automatic bank imports via Plaid, auto-categorising, payment reminders and extra users

• Card payments: 2.9% + $0.60 per transaction on Starter (3.4% + $0.60 for Amex). On Pro, your first 10 card transactions each month skip the $0.60.
• Receipt capture is a paid add-on on Starter, at $11 a month.
• Payroll is a paid add-on.

Xero pricing

Plan	Monthly	What you get
Early	$27	20 invoices and 5 bills a month, unlimited users
Growing	$59	Unlimited invoices and bills
Established	$97	Adds multi-currency, projects and expense claims

• Early$27
• Growing$59
• Established$97

Drawn from the table above. Lowest price highlighted.

Xero Payroll in the US runs through Gusto, from $36 a month plus $6 per person.

What you pay in year one

Here’s the interesting bit. With the 80% partner offer, Xero Early costs $5.40 a month for 6 months, then $27: $194.40 in year one, almost the same as Wave Pro at $190. From year two, Early is $324 a year against Wave Pro’s $190, and most businesses move up to Growing at $708.

Bank Feeds and Reconciliation

This is the biggest practical difference. On Wave Starter there are no automatic bank imports: you upload CSV files or type transactions in. Wave Pro adds automatic imports through Plaid, for supported banks.

Every Xero plan includes bank feeds, and its reconciliation screen suggests a match for each bank line so you can confirm it with one click. Reconciling every month is what keeps your books right. My bank reconciliation guide explains why it matters.

Invoicing and Getting Paid

Wave is excellent here for the price. Starter gives you unlimited invoices and estimates, and you can invoice from the mobile app. Pro adds automatic payment reminders.

Xero’s invoicing is just as capable, with quotes, repeating invoices and online payments. The catch is Early’s limit of 20 invoices a month. Send more than that and you need Growing.

Reporting

Wave covers the essentials: profit and loss, balance sheet, cash flow and sales tax reports. That’s enough for a simple business and your year-end accountant.

Xero goes further, with customisable reports, tracking categories to split results by location or product line, budgets and a cash flow view. If you want to understand which parts of your business make money, Xero gives you more to work with.

Ecommerce, Inventory and Integrations

• Ecommerce: Xero has a free Shopify integration built by Xero and connects to settlement tools such as A2X for Amazon and Etsy. Wave has no comparable marketplace connections.
• Inventory: Xero tracks basic stock items on every plan. Wave has no inventory tracking.
• Apps: Xero connects to more than 1,000 apps. Wave’s list is much shorter.

If you sell products online, this section usually decides it. See my Xero for ecommerce guide and best accounting software for ecommerce.

Users, Countries and Growth

• Users: Xero includes unlimited users on every plan. Wave adds extra users on Pro.
• Countries: Wave is built for the US and Canada, with pricing in USD and CAD. Xero has local plans and tax features in many countries, including the UK, Australia and New Zealand.
• Multi-currency: on Xero Established.
• Accountants: many accountants work in Xero every day. Fewer use Wave, though most can work from its reports.

Who Should Choose Which?

Your situation	My pick	Why
Freelancer, a few invoices a month	Wave Starter	Free, unlimited invoices
Freelancer who hates typing in transactions	Wave Pro	Automatic bank imports for $190 a year
Small team or bookkeeper involved	Xero	Unlimited users on every plan
Online store or marketplace seller	Xero	Shopify integration, A2X and inventory
Business outside the US or Canada	Xero	Local tax features in many countries
Planning to grow and hire	Xero	More reporting, apps and payroll options

Moving From Wave to Xero

1. Pick a switch date, ideally the start of a month or year.
2. Export from Wave: your trial balance, customer and supplier lists, open invoices and bills.
3. Set up Xero with your chart of accounts and opening balances.
4. Connect your bank feeds and reconcile the first month carefully.
5. Keep your Wave login for your historical records.

My Verdict

Wave is the best free accounting software for a freelancer in the US or Canada with simple books. Start there if cost matters most, and move to Pro when typing in transactions gets old.

Choose Xero as soon as you need more than one person in the books, sell products online, work outside North America or want reporting that helps you run the business. With the partner offer, year one on Early costs about the same as Wave Pro.

Frequently Asked Questions

Next steps: Wave review · Xero review · best free accounting software · Xero vs QuickBooks.