QuickBooks Online vs Xero in Canada
Both are paid, both have a 30-day free trial, and both handle GST/HST. The biggest difference in Canada is payroll: QuickBooks runs it as an add-on, while Xero sends you to a partner app such as Wagepoint. Here's the rest, checked on both Canadian sites in October 2026.
The short answer
Pick on the thing your business can’t do without.
You pay employees
QuickBooks has its own Canadian payroll, as an add-on. It works out CPP, EI and income tax, and does T4s and Records of Employment. Xero doesn't run payroll in Canada: you run it in a connected app such as Wagepoint, and the totals land in Xero.
You track inventory
QuickBooks includes inventory on its Plus and Advanced plans. Xero's Canadian pricing page doesn't say which plans include inventory, so ask Xero before you choose.
You want a simple, known price
Xero lists three plans at $25, $60 and $80 a month. QuickBooks lists five plans, from Lite at $20 a month. Both run introductory discounts.
You send a lot of invoices on the cheapest plan
Xero's Starter plan allows 20 invoices and 5 bills. Standard and Premium have no such cap. QuickBooks Lite allows 2 bank connections and 1 user.
Side by side
| QuickBooks Online (Canada) | Xero (Canada) | |
|---|---|---|
| Free plan | No; 30-day free trial, no card needed | No; 30-day free trial |
| Plans | Lite, EasyStart, Essentials, Plus, Advanced | Starter, Standard, Premium |
| Monthly price | Lite listed from $20. Other plans: see their pricing page | $25, $60 or $80 |
| Users | 1 on Lite and EasyStart, up to 3, 5 or 25 on the others | No per-user fees |
| Bank feeds | 2 bank connections on Lite; unlimited from EasyStart | Bank feeds, including direct feeds from BMO and CIBC; manual import if your bank can't connect |
| Sorting transactions | Intuit AI helps categorize expenses | Xero's assistant, JAX, matches and categorizes transactions; check which plan includes it |
| GST/HST | Calculated and tracked; you prepare the return in QuickBooks and submit it to the CRA | GST/HST return reports, plus BC PST, Manitoba RST, Saskatchewan PST and Quebec QST |
| Invoices | Yes | 20 on Starter; no cap on Standard and Premium |
| Payroll in Canada | QuickBooks Payroll add-on: CPP, EI, income tax, T4, RL-1, ROEs | In a connected app: Wagepoint, Payment Evolution or Payworks |
| Inventory | Plus and Advanced | See Xero's site |
| Multiple currencies | See QuickBooks' site | Premium |
From quickbooks.intuit.com/ca and xero.com/ca as of October 2026. Prices in Canadian dollars, before introductory discounts. “See their site” means we didn’t confirm the detail there, not that it’s missing.
Price
Xero’s three Canadian plans are $25, $60 and $80 a month, with no per-user fees. When we checked, new customers were offered 80% off for the first 3 months. QuickBooks has five plans. Lite is listed from $20 a month, with an introductory discount showing when we checked. We couldn’t read QuickBooks’ other prices reliably, so we haven’t quoted them: see their pricing page. Neither company has a free plan.
GST/HST
Both work out and track the sales tax on each transaction for you. In QuickBooks, you prepare the return from the Sales Tax screen, submit it to the CRA yourself, then mark it filed. Xero produces a GST/HST return report you use to file, and also has reports for BC PST, Manitoba RST, Saskatchewan PST and Quebec QST.
Bank feeds
Both pull transactions in from your bank. QuickBooks Lite allows 2 bank connections, and EasyStart and up allow as many as you like. Xero names direct feeds from BMO and CIBC, and lets you import your bank data by hand if your bank can’t connect.
Payroll
This is the clearest difference. QuickBooks Payroll is a monthly add-on that calculates and withholds CPP, EI and income tax, fills out T4 and RL-1 slips and does Records of Employment. Xero’s Canadian site says payroll runs in a connected app and the results land in Xero. It names Wagepoint, Payment Evolution and Payworks, which charge for themselves. QuickBooks’ payroll price wasn’t on the pages we read, so check both costs before you decide.
Who each one suits
- QuickBooks Online: a business with employees that wants payroll and books in one product, one that tracks inventory, or a team of more than 5 people (Advanced allows up to 25 users).
- Xero: a business happy to run payroll in Wagepoint or a similar app, one that bills in foreign currencies (Premium), or one that wants a short list of plans with plain monthly prices.
- Either: both have a 30-day free trial. Load a month of your own transactions into each and see which one you’d rather open every week.
A third option, if you don’t need payroll
Spark Books is free bookkeeping for Canadian small businesses. You upload your bank and card statements, and it sorts each transaction into a Canadian chart of accounts with the GST/HST split out, works out your GST/HST return figures and hands your accountant a year-end package. It has no live bank feed, no payroll and no inventory, and it isn’t available in Quebec yet. How Spark Books works, or compare it with QuickBooks and Xero.
Questions
- Is QuickBooks or Xero better for a small business in Canada?
- Neither wins on everything. QuickBooks suits you if you run payroll and want it in the same place, or track inventory (Plus and Advanced). Xero suits you if you're happy to run payroll in a separate app like Wagepoint, want a short list of plans, or deal in foreign currencies (Premium). Both handle GST/HST and both offer a 30-day free trial, so try each with a month of your own transactions.
- Which is cheaper in Canada, QuickBooks or Xero?
- At the bottom end, QuickBooks Lite is listed from $20 a month and Xero Starter is $25 a month, as of October 2026. Lite is for one user with 2 bank connections; Starter caps you at 20 invoices and 5 bills. For QuickBooks' other plans, see quickbooks.intuit.com/ca/pricing. Xero Standard is $60 and Premium $80. Both run introductory discounts.
- Does Xero do payroll in Canada?
- Not by itself. Xero's Canadian site says payroll runs in a connected app and the results land in Xero. It names Wagepoint, Payment Evolution and Payworks. Those apps have their own price.
- Does QuickBooks Online do payroll in Canada?
- Yes, as a monthly add-on. QuickBooks Payroll calculates and withholds CPP, EI and income tax, fills out T4 and RL-1 slips, and does Records of Employment. QuickBooks says it can also be used on its own. The price is on its pricing page.
- Do QuickBooks and Xero file my GST/HST return?
- Both work out the figures. QuickBooks' help article has you prepare the return in QuickBooks, submit it to the CRA, then mark it filed. Xero produces GST/HST return reports, plus BC PST, Manitoba RST, Saskatchewan PST and Quebec QST reports, that you use to file online.
- Is there a free alternative to QuickBooks and Xero?
- Yes. Spark Books is free bookkeeping for Canadian small businesses outside Quebec. It doesn't have a live bank feed, payroll or inventory, so it suits a business that doesn't need those. Our free bookkeeping software page compares the other free options.
More comparisons
Free software
- Spark BooksEverything Spark Books does, and the two plans.
- Free bookkeeping software in CanadaWhat's actually free, and the catch with each.
- Free accounting software in CanadaWhat it has to do for the CRA, and when you still need an accountant.
- AI bookkeepingWhat it gets right, what it gets wrong, and why Spark asks.
Switching from
- A free QuickBooks alternativeWhat Spark does and doesn't do next to QuickBooks Online.
- A free Xero alternativeHow Spark compares with Xero for a Canadian business.
- A Wave alternativeWhat changed on Wave's free plan, and your options.
- A free FreshBooks alternativeFreshBooks' Canadian plans next to Spark Books.
Head to head
- Wave vs QuickBooks OnlineFree with manual work, or paid with a bank feed.
QuickBooks and Intuit are trademarks of Intuit Inc. Xero is a trademark of Xero Limited. Wagepoint, Payment Evolution and Payworks are trademarks of their owners. Spark Finance isn’t affiliated with or endorsed by any of them.
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