Wave accounting software is a cloud-based financial tool built mainly for small business owners, freelancers, and entrepreneurs. Its main draw is that it provides free accounting and invoicing features, which can help users manage their money without paying expensive fees. Wave helps businesses keep track of income and expenses, send invoices, collect payments, and generate simple financial reports. The software is known for its easy-to-use interface, making it friendly for people without financial or accounting experience.
Although Wave started as a free accounting platform, it has added paid subscription options and extra features. It still centers on helping small businesses with basic money management, taking daily tasks like bookkeeping off your hands so you can pay attention to growing your business.
Who Created Wave Accounting Software?
Wave Accounting Inc. was started in July 2009 in Canada by Kirk Simpson and James Lochrie. The accounting software became available to the public in November 2010, focused on free online accounting for companies with 1-9 employees. Soon after, Wave added invoicing and receipt-scanning features, then expanded into payment processing and payroll starting in 2012.
On June 11, 2019, H&R Block bought Wave for $537 million. Even after the purchase, Wave has mostly kept its original focus-serving small businesses. In June 2022, Kirk Simpson left his role as CEO, and Zahir Khoja took over. Wave’s main office is still in Toronto, Canada, and as of January 2023, about 370 people work there.
How Does Wave Accounting Software Work?
Wave is an online program, so you only need internet to use it-no downloads required. It follows double-entry accounting, meaning every financial event records both a debit and credit. This helps you keep correct records for income, expenses, assets, and debts.
You can connect your business bank accounts and credit cards to automatically pull in transactions, saving time and cutting down mistakes. Wave sorts these transactions into the right categories, making expense tracking easier. You can also create and send customized invoices to clients, and if you set up Wave Payments, your clients can pay you online. Wave sends payment reminders, creates simple financial reports, and automates other common tasks.
Who Should Use Wave Accounting Software?
Wave is best for:
- Freelancers: People who work on several projects and want basic tools for tracking money earned and spent, invoicing, and getting paid.
- Small Businesses and Solopreneurs: Businesses with less than 10 workers, especially service providers, who need simple accounting and expense tracking.
- Startups: New businesses trying to handle money matters without spending on expensive software.
- Online Sellers: Businesses selling online (though advanced inventory tools are limited); Wave can link to Shopify and PayPal for sales reports.
- Consultants: Anyone billing several clients who needs a quick way to send invoices and track receipts.
Wave might not fit if your business is growing quickly or has complex needs (like intensive inventory, project management, or strict audit trails). Bigger operations may want more advanced software.
Wave Accounting Software Main Features
Wave has many features meant to make financial management simpler for small businesses and freelancers. Some basics are free, while others require payment or a subscription. These features help automate work, give financial insight, and keep business operations running smoothly.
Invoicing and Accepting Online Payments
Wave’s invoicing system is a strong suit. You can set up professional, customized invoices (with your logo and brand colors) using several templates. Send unlimited invoices or estimates to clients by PDF or link.
If you enable Wave Payments, clients can pay by credit card, bank transfer, or Apple Pay. This speeds up payments and makes things easier for both sides. You can set up reminders for late payments, helping you get paid on time. The Pro plan also lets you remove the Wave logo from invoices and add attachments.
Tracking Income and Expenses
Wave helps you see where your money comes from and where it goes. Link as many bank accounts and credit cards as you want-transactions import automatically for paid plans. This means less manual entry and fewer mistakes. You can sort transactions into categories, which is key for tracking spending and finding tax write-offs.
The mobile app and receipt scanner add-on let you quickly scan receipts. If you prefer, you can also enter expenses by hand. This ensures all transactions, even cash spending, are tracked.
Financial Reports
Wave provides basic reports to help you understand your finances. These include profit and loss statements, balance sheets, cash flow reports, and aged receivables. You can set the date range or choose between cash or accrual accounting. Reports can be downloaded as CSV or PDF files. Note, though, that these reports are limited compared to more complex accounting tools. You won’t find filters for customer, vendor, or detailed analytics by sector.
Payroll Processing
If you have staff, Wave’s payroll tool (extra cost) calculates wages, handles tax deductions, and deposits money to your team. It works in the US and Canada. In 14 US states, Wave can also file payroll taxes for you. Otherwise, you’ll get guidance but must file forms yourself. Note that in May 2025, Wave’s switch to a new payroll platform led to technical problems for US users, and help from support has reportedly been slow to arrive.
Multi-Currency Invoicing
If you bill in more than one currency, Wave can handle those invoices, including currency conversions and real-time rates. This works well for businesses with clients or suppliers in different countries. Reporting stays in your main currency, however, so you’ll see everything in one set of numbers.
Bank and Credit Card Connections
Wave lets you link bank and credit accounts directly (via services like Plaid) to automatically import transactions. This cuts down bookkeeping time and reduces mistakes. The software can learn from your manual sorting of transactions, getting better at future sorting. Note that automatic import is only included in the paid Pro plan, while free users must enter transactions manually or upload files.
Mobile App Functions
Wave’s mobile app, for Android and iOS, makes it easier to manage your finances from anywhere. You can send invoices, scan receipts, and see lined-up transactions. If you’re always on the move, this can help keep your records up to date. Some users say past scanner bugs have improved with updates.
Integrating with Other Tools
Wave includes basic integrations for selling online and payment processing, such as with Shopify, PayPal, and Stripe. You can expand this by using Zapier, which allows Wave to work with thousands of other apps (may require additional fees with Zapier). You can also export data to Google Sheets or Excel.
Protecting Data and Privacy
Wave uses strong security features to protect customer data. Information sent between your computer and Wave’s servers uses up to 256-bit TLS encryption, the same level banks use. User accounts have secure logins, and all transaction data is stored in the cloud with backup in case of loss. Wave follows PCI Level 1 standards for handling payment data. When connecting bank accounts, multi-factor authentication adds extra security.
How Much Does Wave Accounting Software Cost?
Wave is known for its free accounting and invoicing tools. However, it offers additional paid subscriptions and add-ons for more complex needs, extra features, or personal support.
Does Wave Really Offer a Free Plan?
Yes. Wave’s free plan (called “Starter”) includes:
- Unlimited transactions
- Unlimited invoices and estimates via PDF or link
- Custom invoice design (logo and colors)
- Basic financial reports
- Accepting online payments (processing fees apply)
- Automatic payment reminders (when paid with Wave)
- Mobile app access for invoices and estimates
The free plan is great for basic needs but lacks live support and doesn’t pull bank transactions automatically.
How Much Are Wave’s Paid Features?
Wave’s Pro plan costs $16/month ($170/year if paid upfront). It adds:
- Automatic bank transaction import and sorting
- Payment reminders for any invoice, not just Wave Payments
- No Wave logo on invoice footers
- Attachments for invoices/estimates
- Email template customization
- Ability to add team members to your account
- Receipt scanning via app (also sold separately for $8/month, or $72/year)
Pro plan fills some gaps for users needing more automation or who have small teams.
Are There Other Fees for Payroll or Payments?
Yes. Some services come with their own charges.
Payment Processing (Wave Payments):
- Visa, Mastercard, Discover: 2.9% + $0.60 per transaction
- American Express: 3.4% + $0.60 per transaction
- ACH/bank transfer: 1% per transaction (min $1)
Payroll (Wave Payroll):
- Tax Service States (14 US states): $40/month plus $6 per worker
- Other States: $20/month plus $6 per worker (with support for filings, but you file yourself)
- First 30 days are free
Other Options:
- Mobile receipt scanner only: $8/month ($72/year)
- Bookkeeping services: From $149/month
- Accounting/payroll coaching: $379 one-time (includes 30-day email support and some live calls)
If you want to use all features, you’ll need to add up the individual costs to get your total.
Advantages of Using Wave Accounting Software
Saves Money
Wave stands out by letting small businesses and freelancers manage accounting and invoicing with no software fees. This removes a big ongoing expense. The paid plans are also cheaper than most rivals, which helps as you grow. Even the add-ons cost less than most full accounting tools.
Easy to Use
Many people like Wave because it’s simple and clear. You can find everything in a straightforward dashboard, with easy menus. There’s less clutter and fewer confusing terms, so even beginners can get started quickly. Helpful articles and guides cover the basics. While one review mentioned some menu items weren’t totally clear at first, most users find it easy to use once set up.
Time-Saving Features
Wave cuts down on time spent entering transactions by letting you connect your accounts and letting the software sort transactions for you (on the Pro plan). Automatic reminders for invoices, automatic reporting, and automated payroll (where available) also help save hassle and keep your records accurate.
Accessible from Anywhere
Because Wave is online, you can check your finances or send invoices wherever you are. The mobile app lets you manage invoices and scan receipts on the go. This is especially helpful for people who spend lots of time outside the office.
Makes Managing Cash Flow Easier
Wave’s built-in invoicing and payment tracking make it quicker to see who owes you money and when. It’s easy to review spending and see reports that help with planning and making money decisions. All your financial records are stored in one online system, reducing the chance of missing important details.
Limitations of Wave Accounting Software
Wave’s focus on simplicity and small business needs means it’s not for everyone. Here are its main downsides:
Limited Payroll & Tax Tools
Wave payroll only works in the US and Canada. Only 14 US states get full tax filings; elsewhere, you have to file payroll taxes yourself, even though there’s help available. In 2025, Wave changed its payroll processing for US users, causing technical issues and slow customer help.
Missing Inventory & Project Tracking
Wave isn’t set up for businesses needing close inventory tracking or advanced project management. You can add product items for invoices, but there’s no real inventory control. Likewise, it can’t track project hours or project-specific profits in detail, so these businesses need extra tools.
Customer Support Can Be Slow
Users on the free plan can only access an AI chatbot and online help-no live help from real people. Paid plan users get email or chat support for some services, but reviews say help is often slow and there are no phone numbers to call, which can be stressful when you have an urgent problem.
Not Meant for Growing or Larger Businesses
Wave is built for very small businesses (under 10 staff). If you start needing audit features, advanced reporting, team roles, deep integrations, or complex account setups, you’ll probably outgrow Wave. At that point, software like QuickBooks Online or Xero might fit better.
How Safe Is Wave Accounting Software?
Wave pays close attention to keeping your data safe. All info sent between Wave and your device uses bank-level encryption (up to 256-bit TLS). The company meets the highest standards for handling sensitive payment info (PCI Level 1), so your data is protected during payments and storage.
For bank account links, Wave uses trusted services like Plaid, which requires multi-factor authentication. Wave accounts are read-only, which means the software pulls transactions but can’t move money. This makes it harder for hackers to steal funds even if credentials are stolen. The platform also updates security systems regularly and protects physical servers to keep out unauthorized access.
Alternatives to Wave Accounting Software
Wave is a good option for small businesses, but other accounting software may fit your needs better, especially as your company grows. Here are a few other popular choices:
| Software | Main Features | Price (Starting) |
|---|---|---|
| QuickBooks Online | Advanced features, detailed reporting, inventory management, project tracking, many integrations | $30/month |
| FreshBooks | User-friendly, strong invoicing, time tracking, project management, client portal | $21/month |
| Xero | Unlimited users, advanced reports, good for teams, strong bank reconciliation | $20/month |
| Zoho Books | Free & paid plans, good support, integrates with Zoho apps, strong invoicing and reconciling | Free/$20+/month |
If you outgrow Wave, these programs let you track more complex finances, inventory, teams, or offer better support.
Things to Think About When Picking Accounting Software
- Your business size: Are you just starting out, or do you have employees and inventory?
- Features you need: Do you need advanced inventory, time tracking, or just basic invoicing?
- Will you grow?: Can the software keep up if you add more work or staff, or will you need to switch?
- How easy is it to use?: Do you want something super simple, or more complex features?
- Support: Do you need fast, real-person help, or are you okay using a help library or bot?
- All costs: Watch out for extra fees for payments, payroll, extra users, or integrations.
- Integrations: Does it work with other apps you use (shop, POS, CRM, etc.)?
- Security: Does it use strong encryption and best practices to protect your info?
Frequently Asked Questions About Wave Accounting Software
Is Wave Accounting Right for My Business?
Wave works best for freelancers, solopreneurs, and very small businesses (less than 10 people), especially those in service industries. It’s especially useful if you need free tools for invoicing, expense tracking, and simple reports without much complexity. If you want advanced inventory, project tracking, lots of user roles, or help on demand, Wave may not be enough. In that case, QuickBooks Online or Xero could be better options.
Can I Switch to Wave from Other Software?
Yes. You can import your previous data into Wave, either by connecting your bank and credit cards (Pro plan), importing CSVs, or manual entry. There’s no test/demo company, so moving lots of data may take some extra time. It’s a good idea to work with an accountant if your data is complicated.
Does Wave Work for International Businesses?
Wave supports international invoicing and lets you bill in many currencies. However, all reports show numbers in your main currency, and payroll is only for the US and Canada. Wave is less suited for countries where taxes are included in prices (like Australia). If you need thorough international tools, you may need a different platform.
What If I Need to Upgrade or Cancel?
If you need more than the free Starter plan offers, you can upgrade to the Pro plan or add services like payroll or receipt scanning. You can cancel paid services anytime. Financial data can be exported, so you keep your records if you switch away from Wave.
Is Wave Accounting Software Right for You?
Wave is a top choice for freelancers, solopreneurs, and very small businesses looking for powerful yet free accounting tools. Its free plan covers basic accounting and invoicing, and the software is easy for beginners. The cloud-based platform and mobile app let you stay on top of your finances from anywhere.
But as businesses expand or need more features (like advanced inventory, project work, or full payroll), Wave’s tools may not be enough. Customer support can be slow, especially for free users. While paid plans add more features, costs and missing advanced tools might mean using something like QuickBooks Online or Xero as you grow.
For basic needs and keeping costs low, Wave is an excellent starting point. Its export options also make it easier to switch software if your business outgrows it in the future.
