Business Invoicing Software

This is my review of top business invoicing software FreshBooks.


what is freshBooks?

FreshBooks is secure, online software with powerful but simple billing features that can be used world-wide. 

It was developed over 10 years ago by a businessman looking for a smarter way to invoice customers after he accidentally wrote-over a customer invoice in his spread sheeting software.

FreshBooks is recommended by 97% of small business owners.

The current FreshBooks software was unveiled towards the end of 2016 to be a fresh, simple and faster product compared to their Classic version. 

This article contains an affiliate link.

Top Invoicing Software

Advantages of Using FreshBooks Business Invoicing Software

  • This invoice estimate software enables you to generate income and keep easy bookkeeping records

  • It avoids you getting bogged down trying to learn complicated accounting stuff

  • You can focus on serving and charging your customers

  • You can keep easy track of all your expenses and customer payments

  • All your data is online so you can access it from anywhere

  • Use FreshBooks on the go with their mobile app

the best feature of this business invoicing software

FreshBooks is perfect for helping you with customer billing and sales invoice tracking, after all this is where your potential income and survival is at!

This feature makes it ridiculously easy for you to prepare sales invoices and stay on top of customer payments, and free up your time to do what you need and love to do.

Disadvantages of using freshBooks

You will not consider these a disadvantage if your focus is on getting easy-to-use top invoicing software…

There are several features in other bookkeeping programs that you will not find in FreshBooks business invoicing software. They are:-

  • A Cashbook

  • *Being able to reconcile your cashbook to your bank account

  • Balance sheet accounts or a balance sheet report

  • The ability to track periodic inventory

Also, customer payments do not automatically import to FreshBooks. You must check your bank account and manually apply the payments received against the sales invoices in FreshBooks.

*In Jan 2018 I asked FreshBooks about bank reconciliations and they advised me that they have had a lot of requests for this feature to be included, so it is on their radar.

However, they have no time frame yet as to when it will be done.

Their goal was to keep it simple and deliver it as single entry software.

who is freshBooks for?

FreshBooks business invoicing software is best for:- 

  1. self-employed people, with or without employed staff

  2. in service based industries

  3. who want to control their invoicing procedures, and

  4. who want quick access to expense reports.

It can be used by small business owners world-wide because there is a sales tax feature.

It is best used along-side other bookkeeping or spread-sheeting software in which you can track your cashbook bank balance and assign expenses to a balance sheet  (I explain this in more detail further down this page) or used along-side a professional bookkeeper or accountant who can do this side of things for you in separate software.


who is freshBooks NOT For?

It is not for you if you want an all-in-one accounting system that allows you to reconcile your bank account or assign transactions to a balance sheet, or to track periodic inventory or bills payable.

FreshBooks PRICING

FreshBooks Cloud Accounting - Free Trial - free trial for 30 days

US$15 per month on the Lite plan – this lets you bill up to 5 clients. Pay monthly or save 10% on one annual payment

US$25 per month on the Plus plan (the most popular plan) – lets you bill up to 50 clients and to send proposals and includes all Lite features.

US$50 per month on the Premium plan – bill up to 500 clients - includes all features from Lite and Plus plans.


Prices include world-class support, a knowledge data base and the ability to call FreshBooks direct.

What can you do in freshbooks

Here is a list of most things you can do in this business invoicing software

1. Sales Tax

  • You can include sales tax on all expense and income transactions.

  • You can view a nifty sales tax summary report that displays the tax information you need to complete your sales tax return to your government.

One negative point I see is that sales tax is not calculated automatically by FreshBooks. 

The sales tax on every expense or income transaction has to be manually calculated by you with a calculator and then entered against the transactions. 


2. Estimates

Email to your clients estimates or proposals of work, listing the services you will provide and their cost.


3. Connect your bank

Connect your bank accounts to FreshBooks business invoicing software to automatically import all expenses.

Note: this does not give FreshBooks access to your bank account to make payments or transfer money – all it can do is import expense transactions from the bank statement.


4. track Expenses

The monthly subscription price of FreshBooks is a deductible business expense.

  • Assign your expenses into categories which are already in the system

  • The system lets you create new expense categories

  • At the time of assigning each expense you can tick them as billable if they need to be invoiced to a customer

  • Edit expenses when required.

FreshBooks Expenses ScreenshotScreenshot of Expenses Feature

5. Add images of receipts

There is an option within each expense transaction to add an image of the receipt.

Snap a photo of it with your phone or scan it in to your computer, and then drag or find the image file to add.

If it is a PDF it will display the PDF logo or if it is a shop receipt it will display that.

It is easy to delete if you find you have attached the wrong image. 

This feature is great for three reasons:- 

  1. You will have proof of purchase for tax purposes

  2. You’ve got a document backup if there is a dispute with a customer

  3. If you use an accountant, they will easily be able to check the document (this is handy when, for example, your accountant needs to decide if a purchase should be an asset instead of an expense)

FreshBooks Edit Expense ScreenshotFreshBooks Business Invoicing Software : Edit Expenses Screenshot

6. client database

Maintain a database of client details which includes contact information and the current balance owed to you by them.


7. track time working

  1. Start a timer

  2. Assign the client (project, service) to the timer

  3. Work, work, work and whistle while you work…

  4. End the timer

  5. This recorded time will be available to select when you go to bill your client

FreshBooks Time Tracker ScreenshotTrack Time Working Screenshot


8. Invoice | Bill Your Clients

  • Customize your invoice template

  • Create your invoices and include the time from above, any extra time that wasn’t timed, any expenses you had to pay for on their behalf, and any items that you provided, add sales tax if applicable

  • Email the invoices to the client

  • Give them payment options including credit card

  • Automatically send reminders to the clients to pay their invoices

  • Automatically add late fees onto overdue invoices

9. track invoices

Easily track how much your clients owe you so you can start chasing in the over-due payments.

10. easy payments collection

The reports make it easy for you to see at a glance who still owes you money.

The App integration (more on this below) means you can use something like CollBox to automatically identify overdue payments and pair that debt with the best collection agency – all you must do is approve them – and then get on with your customer service while they collect your money.


11. Invite Employees and contractors

  • Give your employees access to your FreshBooks business invoicing software so they can track their time
     
  • Give access to an admin person that helps you with the billing

  • Give access to your contractors to collaborate on projects and send you invoices.

12. Access Advanced Reports

  • Check how much your clients owe you

  • View a sales tax summary

  • Check what invoices are outstanding in payment

  • Get a full list of all invoices ever sent

  • View an expense report on all expenses not just customer ones

  • Track all the time entries that have been made

  • Get a quick idea of all customer payments that have been collected.

FreshBooks Advanced Reports ScreenshotAdvanced Reports Menu Screenshot

13. connect apps

You can integrate outside Apps into FreshBooks business invoicing software to provide you a more rounded experience like:

  • Bench (professional bookkeepers) 
  • Gusto Payroll
  • Zapier apps
  • Stripe (if you haven’t heard of Stripe, it is similar to Paypal) 
  • Form Builder 
  • CollBox (easy debt collection) 
  • Shopify 
  • and a whole lot of others.

Check out all the Apps available here


14. connect multiple businesses

If you run more than one business, you can connect them to the one Login for easy access, but you will pay a separate fee to FreshBooks business invoicing software for each business.


15. wages information

Wages information can be automatically imported and assigned to an expense categorization using an App integration (like Gusto) so that you have all your expenses in the right place on the Profit and Loss report.


16. Mobile app

There is a mobile App so you can access FreshBooks business invoicing software wherever you are:

  • Create your invoices on the go

  • Immediately capture photos of your client lunch receipts 

  • Reply to client’s questions from the app when you are out and about 

  • Know straight away when a client has viewed their invoice (they cannot say “I never got your invoice”!)

  • Your data syncs with all your devices


17. customer support

You can email or phone FreshBooks business invoicing software with your questions, and from my experience they are very fast to reply. There is a handy little blue circle on every page within FreshBooks providing a fast link to enter a keyword relating to your question to search their database, or you can go to the ‘Need Help’ link on the menu options for other help options like email or phone support.

FreshBooks Menu of Options ScreenshotMenu Options Screenshot


what you cannot do in freshBooks

  • You cannot do a bank reconciliation 

  • You cannot categorize expenses to balance sheet type accounts (for example, an asset purchase) or view balance sheet reports

  • You cannot automatically import customer payments received in to your bank account. You must enter these manually against the sales invoices in FreshBooks (check your bank and update FreshBooks business invoicing software every morning – especially if you use Collbox).

  • You cannot track your business bills and payables

  • You cannot process payroll

  • You cannot track inventory stock items 

  • You cannot download the software to your computer – it is a Saas system (online Software as a Service available over the internet) on which you pay a monthly subscription fee.

  • Do not rely on the profit and loss report inside FreshBooks to be the final result for tax purposes – I explain more on this further below.

What i love about freshBooks Business Invoicing Software

  • I love the display layout and simple navigation through the system 

  • I love how easy it is to prepare new invoices and quickly see how much is overdue or outstanding (either by invoice number or by client name)

  • I love that a small business owner can zone in on everything related to clients and not be worried about full accounting practices

  • I love how easy it is to attach images of receipts to all the expenses in the little photo frame icon within each transaction

  • I love the quick view expense report which groups them into their assigned categories and gives you a total of each.

>>> START YOUR 30 DAY FREE TRIAL OF FRESHBOOKS NOW


what i do not love

Keep in mind that I am a Professional Bookkeeper so these things will not bother a small business owner who wants to keep
their accounting simple and who can use a bookkeeper or other software to do these things:-

  • Not being able to access a balance sheet 

  • Not being able to reconcile the cash book 

  • Not being able to enter and track bills payable (bills to me from vendors and suppliers) 

the freshBooks profit & loss report

Whilst the Profit and Loss report in FreshBooks business invoicing software can help you see if your money is in the black i.e. bringing enough income in to cover all the expenses you pay for out of the bank and leave you with a profit, there will sometimes be expenses that should not be on a P&L but should be on a Balance Sheet.

Here are some examples:

  • personal expenses paid for with business money

  • asset purchases (but you can claim depreciation on assets)

  • loan repayments

  • tax payments  

why is this important?

The above-mentioned expenses are not tax deductible.

Tax is calculated on the final profit, which is calculated within the P&L.

Leaving these expenses on the P&L decreases your profit meaning you pay less tax, but if it is ever found out that you have included non-deductible expenses you will suffer penalties by the government.

Moving these expenses to the Balance Sheet avoids this problem.

So, take care when filing your tax return not to include these non-deductible expenses.

Use a professional bookkeeper or accountant to help you get this right for tax time so you can relax and get on with what you need to do.

If you do not use a bookkeeper or accountant, I highly recommend getting other software that enables you to track deductible and non-deductible expenses in the appropriate reports on a monthly basis, and use the P&L from that other software for filing taxes at the end of the year.

You can even use an Excel spreadsheet like our Accounting Excel Template.

bank reconciliations and freshbooks

As I mentioned earlier, you do not have access to the cashbook in FreshBooks business invoicing software.

You can either keep a cashbook yourself using other software which enables you to process a bank reconciliation (even a spreadsheet or cash book that you write in), or pay a professional bookkeeper to do it.

This is important because un-matching balances mean that income or expense transactions are missing.

This affects the P&L in a negative way.

Even though FreshBooks automatically imports the expenses from your bank account, all software can experience glitches and there may be times when a transaction has not imported. 

A monthly bank reconciliation will uncover missing income or expenses.

why is a bank reconciliation important?

Wouldn’t it be awful if several months down the track you discover a missing billable expense transaction and now it’s too late to charge the customer and you’ve lost out on income?

Or what about income that has not been included on the P&L and is not declared on your tax return thus meaning you pay less tax; you will pay penalties by the government for not declaring income and paying tax on it. 

conclusion on using freshBooks business invoicing software

With FreshBooks you won't spent abundant time learning accounting just to bill your clients or keep your eye on expenses.

And you won't be stuck using Work or Excel to produce and track invoices.

As an experienced bookkeeper I had to re-think everything I am familiar with to be able to work within FreshBooks because of how different it is to the standard bookkeeping software programs available. I had to think like someone who has no experience with double-entry bookkeeping when using FreshBooks because it is a single entry program.

Once I truly understood FreshBooks’ main goal I was much less frustrated.

Their main goal is providing easy accounting software for billing clients and tracking expenses.

This is good news if you are a non-accountant, small business owner because you can skip the complicated accounting.

>>> START YOUR 30 DAY FREE TRIAL OF FRESHBOOKS NOW


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