Here are a couple of examples to get you started, but Zapier works with any app in your tech stack. I could tell you about how I migrated my whole Google Docs invoice stack to Wave in a “fun” hour, but it’s time to stop fanboying. If you’re not sold by now, you might be once you connect Wave with Zapier to integrate it with the rest of the apps you use.

But these cost more than some competitors, so if you process a lot of payments, you may end up paying more with Wave’s “free” accounting than you would with a paid app. Keep your income flowing in with the help of flexible payment options, and money transfers in as little as two days. Keeping track of receipts and invoices is essential for accurate bookkeeping.

FreshBooks

This includes recording income, expenses, payments, and other financial transactions that occur within a business. Bookkeeping is critical to running a successful business, as it provides a clear and accurate record of the business’s financial status. As an independent contractor, you’re going to have to learn to manage these things on your own. Users will be assigned a tax assistant to help customers find tax write-offs that are generally missed.

Use our receipt tracker + receipt scanner app (iPhone, iPad, and Android) to snap a picture while on the go. Hiring a professional to take care of the books will give you more time to concentrate on growing your business. This will separate your business transactions from your personal expenses.

Benefits of Outsourcing Booking & Accounting for Contractors

And the application itself isn’t quite as sophisticated as some of the more well-established options. It also covers certain invoicing and quote-related bases — plus the ability to accept payment via credit card or PayPal. It’s a powerful, easy-to-use solution, but its free plan is extremely free plan-ish.

Once you know, seek out the applications that offer those features. The cash flow page has some useful details, including predictions about your financial future. It suggests actions you can take to keep your finances sharp, such as nudging clients to pay invoices, taking care of your bills, and viewing the status of your bank accounts. Wave’s smart dashboard efficiently organizes your income, expenses, payments, and invoices for fast and accurate tax preparation. You’ll have all the information you need to ensure you don’t miss out on any tax incentives that could grow your business, minimize taxes, and help you keep more of your money.

Managing Taxes for Independent Contractors

As I mentioned earlier, if you need to shift from one accounting application to another, your existing data will have to shift too. Some free accounting solutions make that process more convoluted and frustrating than others — bear that in mind when you pick your preferred platform. So in some cases, going with a free accounting solution might not be sustainable. Lendio sets itself apart from other bookkeeping solutions with its dedicated bookkeeper services, but those services come at a hefty premium.

This includes recording all clients’ income and any other taxable income sources. This information is critical for preparing tax returns and accurately reporting your taxable income. For most independent contractors, it will be beneficial to bring in a CPA to at least help during tax season.

Simple accounting software for self employed traders & sole proprietors

The practice of reconciliation will help you ensure that every transaction matches your accounts. Accounting software will make it easier to do so with the ease of invoicing. Accounting software allows you to invoice your clients and keep up on unpaid invoices. You will get paid for the projects you work on, do taxes on your own, and work when you want to work.

Get rid of late payments by including features like automated reminders and recurring invoices. Make it easy and convenient for your clients to pay by offering options such as bank transfers, credit cards, and online payments. As an independent contractor, it is important to accurately and consistently track your financial transactions. Proper bookkeeping can help you stay organized, make informed financial decisions, and prepare for tax season.

Best for Part-Time Contractors

Receipts and invoices are a record of the financial transactions that occur within your business, which are critical for preparing tax returns and other financial reports. It is important to keep receipts and invoices organized and easily accessible for reference. Brightbook is a web-based accounting solution tailored to suit the needs of independent contractors, freelancers, and small business owners — though it tends to work better for the former two. For one, it’s much easier to do things right from the get-go, rather than try to make sense of many months of and organize tax receipts as well as invoices.

You’ll be able to connect your business credit card to automatically track transactions. The accounting software will also help you maximize your Schedule C deductions and will automatically calculate your quarterly tax estimates. All of the self-employed accounting bookkeeping for independent contractors software we’ve recommended here have fairly straightforward user interfaces. For example, QuickBooks Online’s dashboard is simple, straightforward, and easy to navigate. Its app is similarly easy to use and offers the same features as the cloud-based software.

All plans allow integration with third-party apps such as Stripe or PayPal. QuickBooks Online’s app store breaks down all of its apps by function and provides helpful examples of the benefits of each app. If you’re looking for good accounting capability at a price you can afford, look no further than Wave Accounting. A perfect choice for self-employed individuals and sole proprietors, Wave is 100% free, with no costly plan you need to upgrade to in order to access additional features.

• Using accounting software helps to make sure expenses are accounted for properly, customers are invoiced promptly, and financial statements are accurate.
• If you need to have multiple people within your organization regularly leverage the solution, you might want to explore the possibility of leveraging a paid option.
• Xero offers a wide range of features, including complete custom invoicing, expense and inventory management, and bill payment options, along with a multi-currency option.
• I like how simple Instabooks online invoicing software and app is.
• If you’re just starting out or only have a few clients, then start with a basic version of accounting software that is less expensive.
• Cloud-based online accounting software makes it convenient for businesses to access their books simultaneously as their bookkeeper or accountant.

Akaunting is a free, open-source accounting solution for small businesses and freelancers with a global reach and sizable user base. The program’s full suite of features is available for free — making it one of the few “one-stop-shop” solutions on this list. The program’s features you can access with a free plan are restricted https://www.bookstime.com/ to the point that it might be easy to outgrow. You can only link one bank account and view basic reports with its starter option. Should your needs extend beyond that, you’ll need to upgrade to one of its premium plans. You will want to open a bank account specifically as an independent contractor business.

For self-employed individuals, a major benefit of using Wave Accounting is that it’s 100% free, so you can get started managing your business without any additional out-of-pocket expenses required. One of the greatest benefits you can derive from using Xero is its ability to integrate with more than 700 apps in a variety of categories, which is a major plus for niche businesses. Xero also contains budgeting capability so you can create an organizational budget as well as a departmental budget or project budget if needed. There is also an option to import budget details from another application if necessary.