Sage Intacct vs Xero: A Subscription Invoicing Showdown

Subscription invoicing is far more complex than just sending customers their bills. It includes recurring payments, revenue tracking, tax compliance, fulfilling customer expectations and syncing invoices with external platforms.

Selecting the appropriate invoicing software is pivotal to the success of any subscription business. Sage Intacct and Xero are two well-known contestants in the invoicing arena. They offer many features to make billing effortless, and automate key processes.

In this article, we will compare Xero vs Sage Intacct in detail. We’ll look at how each platform handles invoicing and determine which one does a better job.

Sage Intacct: An Overview

Sage Intacct is made for handling complex financial tasks. It automates recurring billing, supports various billing models, and simplifies revenue recognition, making it ideal for subscription-based businesses. It is also excellent at managing bookkeeping for organizations with multiple locations or divisions.

This means it can handle complicated setups and make financial management easier for companies with diverse operations. It offers combined financial reports, real-time data dashboards, and support for different currencies.

Which businesses use Sage Intacct?

Medium to large subscription businesses, multi-entity organizations, professional services, and several others utilize Sage Intacct. These companies fundamentally have sophisticated billing and accounting requirements, and need a flexible and highly customizable solution in order to run without any glitches.

Xero: An Overview

Xero is a cloud accounting software with easy-to-use solutions. Its package of features comprises recurring billing, bank reconciliation, taxation, and many more. Subscription-based companies benefit from Xero as it automates their essential processes like invoicing, payment processing and income tracking.

Xero does not specialize in invoicing based on complex billing models. Its solutions are focused at meeting the fundamental requirements of subscription businesses. To realize its full potential, companies must couple it with advanced subscription billing systems.

Which businesses use Xero?

It is preferred by small and medium sized businesses that are not fond of overly technical solutions. Its intuitive interface and straightforward features add to its ease of use.

How Does Sage Intacct Support Subscription Invoicing?

Sage Intacct facilitates invoicing and accounting for subscription businesses via these features:

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• Automated Recurring Invoicing

The platform automates the creation and distribution of invoices. It relieves your administrative workload, boosting your team’s productivity. Sage Intacct generates invoices according to adaptable billing schedules. It also provides support for multiple billing schemes like fixed, tiered, and usage-based billing.

• Sales & AR (Accounts Receivable) Invoice Tracking

The software tracks payments in real time, flagging unpaid invoices. It automates payment reminders for customers with failed payments. It also charges late fees on payments received after their due dates. With this system, companies are able to achieve smooth cash flows, and reduce the chances of failed or delayed payments.

• Invoice Customization

Sage Intacct allows companies to design professional and branded invoices. Businesses can choose from a number of templates, and configure the invoices according to their customers’ needs. This leads to smooth customer checkouts, and improves brand image.

• Invoice Syncing with Payment Gateways

Sage Intacct integrates with a number of payment gateways. It enables invoice syncing with the payment gateways of your choice, so that you can offer customers the payment options that they need. The platform tracks and records payments in real time, eliminating discrepancies. It makes account reconciliation easy for businesses.

• Built-In Compliance

With Sage Intacct, businesses stay compliant with regulatory bodies like IFRS 15 & ASC 606 for correct revenue recognition. The system also tracks each transaction, and offers correct financial documentation for in-depth audit trails. Sage Intacct allows businesses to carry out their operations without worry, and steer clear of possible legal fines.

How Does Xero Support Subscription Invoicing?

Xero facilitates invoicing and accounting for subscription businesses via these features:

• Automated Recurring Invoicing

Xero auto-generates and transfers customer invoices at desired billing schedules, such as weekly, monthly, bi-monthly etc. Customers are notified automatically whenever their subscription bills are due.

• Payment Gateway Integration

Xero supercharges recurring payments via popular gateways like PayPal, Stripe and GoCardless, maximizing the chances of successful payments. You have the choice to either deduct these payments automatically at every subscription renewal, or allow customers to pay manually via invoices.

• Revenue Tracking

You can easily monitor your paid and pending invoices, as well as calculate your deferred revenue with Xero. It also provides real-time financial reporting to provide you with an insight into your cash flow trends. You can also match your payments with invoices easily for seamless account reconciliation. 

• Support for Multiple Currencies and Tax Compliance

Xero makes it easy for companies worldwide to handle invoicing. Businesses can send invoices in multiple currencies, which is useful for meeting customer needs. It uses the most recent exchange rates to keep everything accurate.

Xero also manages tax calculations on its own, adjusting to the tax laws of different regions. It provides detailed reports, helping businesses comply with local tax regulations. This simplifies global financial management.

• Adjustments for Subscription Changes

Customers have the option to modify their subscriptions. For example, they can upgrade and downgrade their plans. These changes can occur in the middle of the subscription cycle too. In that case, businesses need to adjust their payments and manage any necessary refunds. Xero facilitates those through credit notes as means of adjustment.

For instance, Xero will issue a credit note to the customer who downgrades their plan midway. This credit note will compensate the customer for that part of their original fee which they did not utilize.

• Customizable Invoices

Xero helps businesses create professional and branded invoices. Businesses can choose from a number of invoice templates. They can create branded themes by adding their logo and custom data fields, and modifying invoice layout as needed. They can also create separate invoice themes for separate customer segments.

Sage Intacct vs Xero: Feature-By-Feature Comparison

Let’s examine in detail the invoicing functionalities provided by both platforms:

Automated Subscription Invoicing

• Sage Intacct: Automatically takes care of your recurring invoicing requirements. It tracks the billing cycles you have defined, sending invoices on time without your intervention.

• Xero: Also auto-generates recurring invoices that follow the billing schedules of your choice.

Invoice Customization

• Sage Intacct: You can design custom invoices. You can customize invoice layout, include specific data fields, employ dynamic templates, and much more.

• Xero: Also supports personalized invoices, and provides invoice branding via professional templates, themes and layouts.

Support for Dynamic Billing Models

• Sage Intacct: Offers multiple billing models such as usage-based and tiered pricing.

• Xero: Does not directly support different pricing models. It needs to be integrated with third-party software to enable this function.

Billing Adjustments

• Sage Intacct: Automatically creates and issues credit notes in the event of upgrades and downgrades in subscriptions.

• Xero: Allows you to adjust payments using credit notes, but you have to apply these notes manually.

Multi-Entity Invoicing & Multiple Currency Support

• Sage Intacct: Supports invoicing for companies with multiple branches and conducts billing in different currencies. It provides consolidated financial reports for businesses operating in various locations.

• Xero: Offers multi-currency invoicing only.

Revenue Recognition Compliance

• Sage Intacct: Automatically complies businesses with revenue recognition rules (ACS 606 and IFRS 15). It helps businesses keep track of money they haven’t fully earned yet, called deferred revenue.

• Xero: Does not support revenue recognition or deferred revenue management.

Payment Gateway Integration

• Sage Intacct: Integrates with many payment gateways to supercharge automated payments. Supports different payment options like cards, ACH, and direct debit.

• Xero: Connects with popular gateways such as PayPal and Stripe. Makes it simple to accept payments through methods like credit cards and digital wallets.

Automated Invoice Syncing

• Sage Intacct: Allows tailored integrations. It keeps your data synced both ways, ensuring your systems have the latest information.

• Xero: Integrates smoothly with other systems you use, keeping your data up-to-date everywhere.

Tax Compliance

• Sage Intacct: Automatically handles tax calculations. It also creates reports that help you stay compliant with tax laws.

• Xero: Also performs automatic tax calculations.

Dunning Management

• Sage Intacct: Sends automatic reminders for overdue payments and makes repeated attempts to collect missed payments at specific times.

• Xero: Does not offer this feature. It must be integrated with external software to unlock this function.

Subscription Proration

• Sage Intacct: It automatically prorates subscription charges whenever mid-cycle modifications take place.

• Xero: Has the capability of prorating subscription charges, but verifying and applying these charges requires manual intervention.

Sage Intacct vs Xero: Pricing Comparison

Sage Intact is costlier as compared to Xero. It requires a considerable upfront payment on a yearly basis. That means it may not be within the budget range of startups or small subscription businesses. Xero, meanwhile, offers more cost-effective subscription plans. Here’s a look into the prices of both software:

Sage Intacct

Annual Subscription Cost: It offers subscriptions on a yearly basis, with the starting price at $10,920. This package includes one user license and access to the fundamental financial management tools.

User Licenses: There are two main types of licenses available: business and employee. Business user licenses provide full access to every feature the service offers. Employee licenses, on the other hand, offer restricted access and must be purchased in sets of 10.

Advanced Features: If you want to add extra features such as payroll management and revenue recognition, there will be additional fees to pay.

Implementation Costs: Setting up the service has costs that depend on the size and needs of your business.

Xero

Monthly Subscription Cost: The price of Xero’s subscription plans varies by location. In the US, there are three monthly plans available: Early for $20, Growing for $47, and Established for $80. Each suits businesses of varying sizes. The Established plan includes all the features of the other two plans, plus multi-currency support, project tracking, and expense management.

Add-Ons: Additional features can be added to any plan and they come with different fees. For instance, Xero’s project tracking feature can be bought separately for $7 per-month (for one user).

Made Your Choice Yet?

Xero and Sage Intacct both simplify subscription invoicing with their own distinct features. Your choice of the software depends upon your business size, budget, and subscription requirements.

Here is the bottom line: If you run an enterprise-level subscription business with complicated billing requirements, Sage Intacct is the solution for you. It offers in-depth customization, compliant invoicing, and automated revenue recognition.

On the other hand, if you have a small or mid-sized business, choosing Xero could be a good decision. Xero is simple to use and affordable, making it a smart choice. It can take care of all the basic invoicing needs for subscription businesses.

After you decide on the right accounting platform for your business, you should also consider signing up with SubscriptionFlow for seamless integration. SubscriptionFlow facilitates smooth integrations with both Sage Intacct and Xero, and provides businesses of all sizes with an all-in-one subscription management solution.

SubscriptionFlow also enhances Xero’s invoicing capabilities. It offers businesses dynamic billing models, dunning management, advanced customization, and customer lifecycle management—all of the features Xero alone does not cover.

Book a demo with SubscriptionFlow today, to manage customer subscriptions, and handle recurring invoicing like an expert.