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Navigating the financial aspects of the music industry is complex. For musicians and music industry professionals, the right accounting software is more than just a tool—it's an essential partner in managing their unique financial landscapes.
In an industry characterized by fluctuating incomes, diverse revenue streams, and a blend of expenses, cloud-based accounting systems provide flexibility that can easily track uncertain income streams. In this article, you’ll learn more about accounting software that works best for music industry professionals.
For more guidance on your music taxes, check out our music taxes guide.
The Financial Challenges of the Music Industry
Musicians face a unique set of financial challenges. Their income streams can be unpredictable, stemming from live performances, studio sessions, royalties, and merchandise sales. This irregularity makes financial planning and tracking a daunting task.
Moreover, the industry’s complex royalty structures and the common blending of personal and professional finances further complicate matters. Without the right tools, managing these aspects can become overwhelming, leading to missed opportunities and potential financial missteps.
Top Recommended Accounting Software Options for Musicians
1. QuickBooks Online - Best Overall
QuickBooks has long been a go-to solution for small businesses and individual professionals, and it's no different for musicians. Its user-friendly interface, coupled with a comprehensive set of features, makes it a reliable choice for those who prefer to handle their finances personally or work with a bookkeeper.
QuickBooks is a popular accounting solution for companies seeking scalability. It does this by offering solutions for self-employed individuals through QuickBooks Self Employed. It’s also used by larger organizations due to its built-in analytics tools, enabling companies of all sizes to track data and rereview financial insights.
QuickBooks users also love it for its simple integration features. It connects directly with your bank accounts, lets you set up categories for business and personal expenses, scan documents, and manage payroll for both contractors and full-time hires. Being owned by Intuit, it also integrates with TurboTax, making it a one-stop-shop for many clients.
Pros
Offers excellent scalability potential for growing businesses
Integrates with a variety of third-party tools
An all-in-one solution for invoicing and employee management
Cons
Expensive
Customer service can be questionable.
2. Zoho Books - Best for Integrated Solutions
For the independent artists and smaller musical entities, Zoho Books offers simplicity and efficiency. Its straightforward approach to accounting makes it easy for musicians to stay on top of their financial game without getting bogged down in complexities.
The optional Zoho Invoice tool excels in time management and invoice setup, facilitating quick payments and effective client communication. It's an ideal tool for musicians who need to manage their time and finances efficiently. You can get 1,000 invoices for free, which is ideal for music business professionals to save money when starting with softwares.
Zoho’s more advanced plans provide users with better customer support (through email, voice, and chat), up to 10 custom reports, and the ability to track sales tax (which is great for merch sales). But what draws users to consider Zoho is its network of internal integrations. Zoho’s CRM, help desk, and email support is ideal for a wide range of small businesses.
Pros
Provides an all-in-one solution for integrating across different software types (CRMs, invoicing, etc.)
Easy-to-use interface, especially if you use other Zoho products
Advanced tools for budget reporting and financial analysis with higher-tier programs
Cons
Not as many third-party integrations as QuickBooks
Few automation features
3. FreshBooks - Best for Organizing Your Finances
FreshBooks caters to musicians with a focus on project-based work. This project-based approach enables users to segment financial transactions into different groups. With this, it’s easier to see whether a specific initiative is profitable. This helps music business owners save time when needing to review detailed data.
FreshBooks has a clean user interface, making it look professional and easy to use. But, with this simplicity comes fewer automation features than you get with alternatives like QuickBooks or Xero. Also, despite its ease-of-use, it’s less popular than the aforementioned softwares, meaning accountants are more likely to be less familiar with it.
FreshBooks has familiar features like built-in invoicing. You can use the time tracking features if you hire staff to help your business. So, it has solid scalability for entry-level music companies. But, if you send a lot of invoices, FreshBooks is known for limited invoicing on lower-tier plans. So, double-check any plan you purchase to be sure it meets your unique needs.
Pros
Built tools for CRM, e-signatures, and client portals
24/7 customer support
Has an app store to help find third-party integrations
Cons
Renewal pricing can be expensive
Automated categorizations limited to expenses
Need third-party software to integrate with some tools (like Square and PayPal)
4. Xero Books - Best Pricing
Xero is the less-expensive cousin compared to QuickBooks. Despite this, it offers more features with its entry-level plan, allowing for unlimited users. For growing music businesses, Xero represents an excellent savings opportunity. But, this savings can be quickly eroded slightly if you need to send more invoices, as Xero limits the number of invoices under entry-level plans.
Xero also lacks millage tracking, which is a common feature found across the top three providers on this list. This means if you want to track the mileage on your tour bus or van, you’ll need to track this data manually. Still, musicians who spend a lot of time streaming or making beats (instead of touring) might be willing to sacrifice this feature.
Xero’s internal features include all of the basics: bank connections, project tracking, and invoicing to accept payments. You can also schedule and pay bills directly from the Xero interface, making expense tracking a bit easier. Best of all, it’s typically half the price of many accounting software providers on this list, despite having some advanced features.
Pros
More cost-effective than most other alternatives (QuickBooks)
Inventory tracking with all plans
Unlimited users with all plans
Cons
Entry-level plan limits the number of invoices you can send
No millage tracking
No phone support
5. Wave - Best for Simplicity
Wave’s unique offering is that it doesn’t charge you a monthly or annual subscription. Instead, it charges you only when you earn money, taking a percentage of each invoice payment. As a result, you get a bit more financial comfort, which is something musicians and music business owners can appreciate.
Wave charges monthly premiums if you want payroll support, mobile receipts, or professional advice. Professional coaching in your accounting situation can be a real game changer, especially if you’re struggling to understand tax laws. Writing your first balance sheet can feel pretty overwhelming.
Wave’s biggest struggle comes back to the simplistic platform. While it’s easy to use, it lacks the same automation you might have come to expect from QuickBooks. It also lacks advanced accounting features, which are helpful as your musical organization scales onto bigger things. But, as a small business solution, Wave provides an excellent platform.
Pros
No monthly subscription fees
One of the simplest tax software options you can purchase
Cons
Limited automation features
Lacks advanced features that are helpful for larger organizations
No third-party payroll integrations
6. Sage 50 - Best for Security
For a strong, data-driven experience, Sage 50 is an ideal platform to help make your financial tracking simple. Its cloud-based has a desktop-based software, creating a headquarters of sorts for reviewing financial transactions. Like many of these top providers, you can expect features like invoicing, expense reports, and automated bank connections.
To protect your cloud- and desktop data, Sage uses Sage Security Shield, which includes features like credit monitoring, business dark web monitoring, and an internal fraud hotline. For companies who would normally lack the resources to manage this, Sage 50 can help. Of course, you will have to pay an upfront annual fee to get started, which can get steep for musicians who are just getting started.
Other advanced features include inventory, job, and expense management. For payroll features, you’ll have to make an additional investment. Like Zoho, Sage also has a complete HR management system, which requires more investment. But because of this, Sage is a scalable all-in-one platform, even if it’s not the perfect solution for entry-level musicians.
Pros
Built in tools to track your business’s credit and data on the dark web
Entry-level plan includes inventory management and purchase orders
Over 120+ integrations on its app marketplace
Cons
Expensive (need to pay for a year upfront)
Need to pay extra for payroll
7. OneUp - Great Balance of Pricing and Automation
OneUp is the least popular accounting software on this list, competing with giants like QuickBooks. What makes it better than these giants is the built-in automation tools alongside inexpensive processes. Typically, these two features don’t go hand-in-hand, which makes it an attractive option.
Being a smaller company comes with drawbacks. For example, you won't find many integrations or advanced financial analytics. There are also fewer integrations than other platforms, which can be a headache if you want to automate features from third-party software. But OneUp makes up for this by offering automated bank tracking and inexpensive pricing.
For now, OneUp doesn’t provide an ideal solution for larger organizations. But, as a music business owner seeking simple solutions and a hands-off approach, OneUp is a solid alternative to these other platforms.
Pros
Inexpensive
Solid automation features
Cons
No phone-based customer support
Limited customization options
Fewer features than larger providers
Key Benefits of Accounting Software for Musicians
Efficient Gig Management
One of the primary features that set music industry accounting software apart is its ability to track gig payments and send invoices efficiently. This functionality is crucial in maintaining a steady cash flow, ensuring that musicians are paid promptly for their performances and projects.
Tax Compliance
For musicians, navigating tax obligations can be particularly tricky. Accounting software tailored for the music industry helps in generating accurate financial reports, ensuring compliance, and minimizing liabilities. This is especially important given the varied income sources and deductible expenses that musicians often deal with.
Insightful Financial Reporting
Understanding the financial health of one's music career is pivotal. Good accounting software provides comprehensive financial reports for music sales, offering insights that help in strategic decision-making for future projects and investments.
Expense Management
Managing a wide array of expenses, from travel and accommodation to studio rentals and equipment purchases, is another key feature of these software solutions. This helps musicians keep track of their spending, ensuring that their financial resources are being used effectively.
Streamlined Bookkeeping
Automating data entry and reconciliation processes is a game-changer, significantly reducing the time and effort spent on bookkeeping. This feature is particularly beneficial for artists who may not have a background in finance or accounting.
Pricing and Accessibility of Accounting Software
The cost of accounting software designed for musicians typically ranges from $20 to $200 per month. This variation in price usually corresponds to the range of features offered, with more expensive plans offering more comprehensive tools for managing performance income, expenses, and invoicing. Most modern solutions are cloud-based, providing the added benefit of real-time synchronization across various devices, a crucial feature for musicians who are often on the go.
Desktop vs Cloud-Based Solutions
When searching for the best accounting software, you’ll find one of two options: cloud-based and desktop-based.
Cloud-based solutions are better suited for entrepreneurs and small businesses needing more flexibility and cost-savings. The sacrifice they make is that cloud-based solutions are typically less customizable, often geared towards specific needs.
Desktop-based solutions are generally best for older organizations with traditional structures that can handle large-scale installations. When choosing desktop accounting software, you’re looking for a system to handle every aspect of tracking your financial management while remaining secure on your servers. Granted, you don’t get the flexibility, which costs much more.
Final Thoughts on Finding the Best Accounting Software
The right accounting software plays a crucial role in ensuring financial harmony. By considering their specific needs and the unique challenges they face, musicians can choose software that not only meets their current requirements but also scales with their career growth.
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