Wave vs Xero Comparison 2026
Wave does invoicing and double-entry bookkeeping for free, with no cap on invoices, and earns instead through card processing at 2.9 percent plus 60 cents and a $19-a-month Pro tier for automation. Xero has no free plan at all, starting at $25 a month for Early, which caps at 20 invoices and 5 bills a month, a limit a busy freelancer clears by the third week. Wave is free with a card-processing fee. Xero costs from day one but handles contractors and filings Wave was never built for.
At a glance
- Wave starts cheaper, at $19.
- Only Wave has a free tier.
Side by side
Wave | Xero | |
|---|---|---|
| Starting price (they differ) | From $19 | From $25 |
| Pricing model (they differ) | Free plan, paid tiers | Paid subscription |
| Free tier (they differ) | Yes | No |
| Billing | Monthly or annual | Monthly or annual |
| Free trial | None | Not stated |
| API | Not stated |
Wave
Invoicing and bookkeeping that costs nothing
Wave does invoices, receipts and double-entry bookkeeping for free, and earns on card payments and on a paid tier that automates the parts you would otherwise do by hand. For a sole trader sending a dozen invoices a year it is the cheapest honest answer. Payroll and the advisor service exist in some countries only, which is worth checking before a whole tax year lives in it.
Our note
Free accounting that is genuinely accounting, which is rare enough to be worth the check it needs: confirm that payments and payroll are supported where you live before a tax year is built on it.
Xero
Accounting a freelancer can run without help
Xero covers the parts of bookkeeping a creator actually meets: invoices, bank reconciliation, expenses and the reports an accountant asks for in January. Nothing in it assumes you have taken an accounting class. There is no free plan, and the cheapest tier stops at twenty invoices a month, which a busy freelancer clears by the third week.
Our note
Pick Xero over Wave when you have contractors to pay and a real filing to make, and Wave over Xero when you mostly need invoices to look professional. The invoice cap on the entry plan is the thing people hit and get annoyed by, so count last year's invoices before choosing it.
Why people weigh these two
- Xero instead of Wave
- Xero charges from $25 with no free tier at all, a paid-from-day-one alternative built for a freelancer to run the books without an accountant's help.
- Wave instead of Xero
- Wave does invoicing and bookkeeping for nothing, with paid plans from $19, cheaper than Xero's $25 if the reports an accountant wants are simple enough.
Which one should you pick
Choose Wave if invoices need to look professional and the books need to be real, without a monthly bill: Starter is free and uncapped, and Pro at $19 a month adds receipt scanning and automation once the free plan's manual pace becomes the bottleneck. Confirm payments and payroll are supported where you live before a whole tax year depends on it, since both exist in some countries only.
Choose Xero once there are contractors to pay and a real filing to make: W-9 collection and 1099 filing, cash flow forecasting and reports an accountant recognises are all included from Early at $25 a month. Count last year's invoices before committing to that plan, since 20 a month is the cap most solo creators hit and get annoyed by, forcing a move to Growing at $55.
Common questions
- Which is cheaper, Wave or Xero?
- Wave, by a wide margin at low volume: its Starter plan is free and uncapped on invoices. Xero has no free plan, starting at $25 a month for just 20 invoices and 5 bills, a cap a busy freelancer clears quickly.
- Does Wave handle contractor payments and 1099 filing like Xero does?
- Not in the same way; Wave's own materials focus on invoicing and bookkeeping rather than contractor tax forms. Xero collects W-9 forms and files 1099s, which matters the year a creator first pays an editor or an assistant.
- How does Wave actually make money if the software is free?
- Through card processing, 2.9 percent plus 60 cents on payments, 3.4 percent for Amex, and the $19-a-month Pro tier that adds automation and receipt scanning. Xero has no free tier to offset in the same way; its revenue is the subscription itself.
- Which one is better for somebody who mostly needs professional-looking invoices?
- Wave, by its own comparison to Xero: pick Wave when invoices looking professional is most of the job, and Xero once contractors and a real filing enter the picture. The free plan's lack of an invoice cap is the deciding fact for a low-volume creator.
Ratings are the average of reviews readers left. The facts are stated by each tool’s own listing and are not verified by CloutStack. How we make money.