Xero vs FreshBooks vs Wave for Australian Freelancers and Sole Traders (2026)

If you’re a freelancer or sole trader in Australia, you need accounting software that handles invoicing, tracks expenses, and makes BAS time bearable: without requiring an accounting degree to operate.

Xero, FreshBooks, and Wave are the three most common options at different price points. Here’s what each one actually does well, and which type of freelancer suits each.

The short version

• Wave: free, genuinely capable for simple freelance work, limited AU-specific features
• FreshBooks: built for service-based freelancers, strong invoicing and time tracking, mid-range price
• Xero: the most complete option, ATO-integrated, more expensive, scales with your business

Xero

Xero is the dominant accounting platform in Australia. It connects directly to most Australian banks, lodges BAS through the ATO portal, and handles GST automatically.

Current AU pricing (as of April 2026):

• Grow: AU$75/month
• Comprehensive: AU$100/month
• Ultimate: AU$130/month

For a sole trader, Grow covers most needs: bank feeds, invoicing, expense claims, BAS prep, and basic payroll if you pay yourself a wage.

The ATO integration is the main reason Australian accountants push Xero. Your bookkeeper or accountant can log in directly, which saves time and money at tax time. If you work with an accountant, ask which platform they prefer: most AU accountants work in Xero.

Where Xero wins:

• Directly integrated with ATO (lodge BAS from inside Xero)
• Bank feeds from all major AU banks
• Accountant ecosystem: your accountant probably already uses it
• Scales well as your business grows

Where Xero falls short:

• Price. AU$75/month is steep if your needs are simple
• Less intuitive for non-accountants than FreshBooks

FreshBooks

FreshBooks is designed for service businesses: consultants, designers, copywriters, photographers. The interface is simpler than Xero and the invoicing tools are more polished.

Current AU pricing (as of April 2026):

• Lite: AU$19/month (up to 5 clients)
• Plus: AU$43/month (up to 50 clients: most popular)
• Premium: AU$78/month (unlimited clients)

FreshBooks handles invoicing, expense tracking, time tracking, and basic reporting. It supports GST on invoices and exports data for your accountant. It does not have a direct ATO BAS lodgement integration: you’ll still need to lodge via the ATO Business Portal, have your accountant do it, or use Xero alongside it.

Where FreshBooks wins:

• Cleaner invoicing experience
• Built-in time tracking (useful for hourly billing)
• Better client portal: clients can view and pay invoices online
• Cheaper than Xero for comparable solo-freelancer needs

Where FreshBooks falls short:

• No direct BAS lodgement
• Less accountant support in Australia vs Xero
• Fewer AU bank integrations

Wave

Wave is free for the core product: invoicing, expense tracking, accounting reports. It charges for payment processing but the software itself costs nothing.

Pricing:

• Core accounting and invoicing: Free
• Credit card payments: 2.9% + 30¢ per transaction
• Bank transfers: 1% (min AU$1)
• Wave Pro (recurring billing, auto-reminders): ~AU$16/month

Wave works for simple freelance setups: a sole trader who invoices a handful of clients, tracks a few expense categories, and doesn’t need BAS integration. It supports GST on invoices and has basic reporting, but does not integrate with the ATO and has limited AU bank feed support.

Where Wave wins:

• Free: nothing beats it on price for simple setups
• Good enough for basic invoicing and expense tracking
• Works for freelancers just starting out

Where Wave falls short:

• No direct ATO/BAS integration
• Limited AU bank feed support
• Less capable than Xero or FreshBooks as your business grows
• Slower support than paid competitors

Side-by-side comparison

Which one should you use?

Use Wave if: You’re just starting out, your invoicing is simple (under 10 clients, no complex expense tracking), and you’d rather pay nothing until your business grows. It’s a reasonable starting point: just know you’ll probably migrate to Xero or FreshBooks eventually.

Use FreshBooks if: You bill by the hour, you want polished client-facing invoices, and you’re comfortable handling BAS separately through an accountant. It’s the best option for consultants and creatives who prioritise the client experience over ATO integration.

Use Xero if: You’re registered for GST and lodge a BAS, you want your accountant to have direct access, or you’re planning to grow beyond solo. The AU bank integration and ATO lodgement alone are worth the price difference for most established sole traders.

A note on BAS

If you’re registered for GST in Australia, BAS lodgement should factor heavily into your decision. Xero is the only one of the three with direct ATO integration: you lodge BAS from inside the platform without exporting to a separate system. FreshBooks and Wave both support GST on invoices and basic reporting, but you’ll need to lodge through the ATO Business Portal manually or have your accountant handle it.

Sources

• Xero pricing plans. Australia. Xero Australia
• FreshBooks pricing. Australia. FreshBooks
• Wave pricing. Wave Financial
• Business Activity Statements. Australian Tax Office

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