The cap you hit first depends on what grows in your business. More invoices each month hit QuickBooks Free at 2 invoices a month and Xero’s Early plan at 20 invoices a month. More clients hit FreshBooks, whose Lite plan stops at 5 clients. A second person hits every plan built for 1 user. More revenue ends Zoho Books’ free plan, which is only for revenue under $50K for the financial year. Wave’s Starter plan and Square Free state no invoice, client, or revenue cap, but that isn’t the same as no limits: Wave’s Starter plan is for one user, so a second person who needs to work in the books means Pro, and Square Free ends on features it keeps for paid plans.
Which cap will you hit first?
Start from what’s changing in your business.
- You’re sending more invoices. QuickBooks Free stops at 2 invoices a month, unless you qualify for and turn on QuickBooks Payments. Xero’s Early plan stops at 20 invoices a month and 5 bills, and anything past them saves as a draft until you upgrade or the month turns. Zoho Books’ free plan allows 1,000 invoices a year, and Zoho Invoice has a yearly limit it shows only inside the account.
- You’re working for more clients. FreshBooks prices by clients: Lite covers 5 clients, Plus 50 clients, and archived clients count. No other tool here caps clients. If prospects are filling your client list, see keeping prospects out of your client count.
- Someone else needs to log in. QuickBooks Simple Start, Wave’s Starter plan, Zoho Books’ free plan, and every FreshBooks plan are each for one user. On QuickBooks the next user is a bigger plan; on FreshBooks it’s a paid team member; on Wave it’s Pro; on Zoho Books it’s Standard, for 3 users. Accountants mostly sit outside these limits.
- Your sales are growing. Only Zoho Books’ free plan has a revenue cap, and it ends the plan for the rest of the financial year.
Unlimited invoices don’t mean unlimited everything. Wave’s Starter plan has no invoice, client, or revenue cap, but it’s for one user: a payroll manager or a tax pro can be added free, and anyone else who works in the books needs Pro. Square Free states no invoice or client cap on its invoices pricing page, and doesn’t say how many people can use it; what ends it is a feature, like a lower card rate or payment schedules, or the day you want books.
What does a second or third person cost?
People are the cap that moves the bill most, so here’s what each tool costs for one, two, and three users, with extra people priced in where a vendor sells them as an add-on. It’s the bill for that many logins, not proof a plan fits your clients or your volume:
| Tool | Total for 1 user | Total for 2 users | Total for 3 users |
|---|---|---|---|
| QuickBooks Online | Free Free plan | $85 a month Essentials | $85 a month Essentials |
| Xero | $27 a month Early | $27 a month Early | $27 a month Early |
| FreshBooks | $23 a month Lite | $34 a month Lite + 1 team member | $45 a month Lite + 2 team members |
| Wave | Free Free plan | $19 a month Pro | $19 a month Pro |
| Zoho Books | Free Free plan | $20 a month Zoho Books Standard | $20 a month Zoho Books Standard |
| Square Invoices | Free Free plan | Not priced: no user count stated | Not priced: no user count stated |
FreshBooks: each person beyond a plan’s included users is a team member at $11 a month, included in the figure.
Square Invoices doesn’t state how many people its plans cover, so this table prices it for one person only.
Three rows need a sentence. FreshBooks includes one user per plan, so its cells add a team member for each person past the first; they also assume Lite, which stops at 5 clients, so with more clients the same team costs more on Plus. Square doesn’t say how many people its plans cover, so the table prices it for one person only. Zoho Books sells extra users too, at $3 per user a month, or $2.50 billed annually; they start to count from a fourth person on Standard.
Say you run a two-person software testing consultancy. You and your partner both send invoices, about twenty-five a month, to around fifteen clients over a year.
Each tool hits a different cap first. QuickBooks Free stops at the invoice limit and Simple Start at one user, so it’s Essentials at $85 a month. Xero’s Early plan stops at its invoice limit, so it’s Growing at $59 a month, with both of you on one price. FreshBooks’ Lite stops at 5 clients, so it’s Plus at $43 a month plus a team member for your partner. Wave Pro at $19 a month and Zoho Books Standard at $20 a month fit both of you with no invoice or client cap in reach. The cap that bites first is different on every tool, which is why the bill is too.
How to check your own numbers
Before you choose, or before you upgrade, pull four numbers from the last twelve months:
- Invoices in your busiest month. Compare with the monthly caps on QuickBooks Free and Xero Early, and with the yearly caps on Zoho.
- Clients billed, including the ones you’d archive. Compare with FreshBooks’ client limits.
- People who need to work in the books this year, not counting your accountant. Compare with each plan’s user limit.
- Revenue for the financial year, and where it’s heading. Compare with Zoho Books’ free plan cap.
The first number to run out tells you which plan you need, or which tool to skip.
What not to pay for yet
Don’t move up for a cap you might hit next year. You can move up when the cap arrives, and paying early buys nothing. The exception is a plan you’d outgrow within a few months on a yearly commitment: pick the plan that fits a year out before you commit to a year. The tool pages, QuickBooks Online pricing, Xero pricing, FreshBooks pricing, Wave pricing, Zoho Books and Zoho Invoice pricing, and Square Invoices pricing, set out every cap on each plan.
Your next step
Pull the four numbers above from last year’s records this week. Circle the one closest to a cap on the plan you’re on, or the plan you’re considering. If you’re within a few months of it, plan the upgrade or the switch now, before it arrives in a busy month.