Xero vs MYOB for sole traders: a fair comparison
Xero and MYOB are the two accounting platforms almost every Australian accountant works in, and for a sole trader the choice between them is less about capability, which is similar, and more about price, fit and preference. This guide compares the entry-level options a one-person business would actually buy, and says where each has an edge.
Updated 16 September 2026. General information only, not tax advice.
What each one is
Xero is cloud accounting software from New Zealand with a very large Australian user base. Bank feeds, invoicing with online payments, bills, GST, activity statements, reporting, and a marketplace of hundreds of add-ons. Plans scale from a limited entry tier to plans with payroll, projects and multiple currencies.
MYOB is the long-standing Australian brand. MYOB Solo is a low-cost mobile app built for sole traders: invoicing, receipt capture, bank feeds, GST and a BAS summary. MYOB Business is the broader cloud product with bills, reporting, payroll options and ATO lodgement of activity statements. Both companies run in the cloud, both are used by accountants nationally, and both keep your money in your own bank account.
Price
- Xero: from around $35 a month for the entry plan, which caps the number of invoices and bills you can send and enter each month; higher plans lift the caps and add features. Around $420 a year at entry level.
- MYOB Solo: around $10 to $15 a month, roughly $120 to $180 a year. MYOB Business plans are priced closer to Xero’s; check current pricing.
For a sole trader with modest needs, MYOB Solo is markedly cheaper. Once you need bills, fuller reports or payroll, the two brands are in the same range and the price difference narrows. Both run promotions on the first few months; compare the ongoing price, not the offer.
Getting transactions in
Both use bank feeds: you connect your bank, transactions arrive daily, and you categorise them with the help of rules and suggestions. Xero’s bank reconciliation screen is well regarded and its rules engine is mature. MYOB’s feeds and categorisation work similarly, and Solo simplifies the screen for a phone. Neither product categorises everything without you; expect to spend time each week or month confirming lines, less over time as rules build up.
Invoicing and getting paid
Xero: quotes, invoices, recurring invoices, automatic reminders, and online payment through card and bank integrations, with reporting on who owes what. MYOB Solo: fast invoicing from the phone with payment tracking and reminders; MYOB Business adds quotes and more customisation. Both produce compliant tax invoices. If invoicing is the heart of your admin, Xero has more depth at the entry price; if you send a few invoices a month, Solo is more than enough.
GST and BAS
Both track GST on each transaction and prepare the activity statement figures. Xero can lodge activity statements directly to the ATO once connected. MYOB Business can as well; MYOB Solo shows the BAS summary for you to enter in ATO online services. In each case you or your BAS agent review before lodging. Both handle cash and accruals bases and the simpler BAS labels. Neither prepares or lodges your income tax return; that is your accountant, who will pull the figures from either product.
Reporting, accountants and ease of use
Xero’s reporting is strong and highly customisable; MYOB Business is comparable and MYOB Solo is deliberately minimal. On accountant support, ask yours: most work in both, but many have a preference and their fee is often lower on the platform they use daily. On ease of use, this is personal. Xero has a clean, consistent interface across everything; MYOB Solo is the simplest of the three to learn because it does less. Try the free trials with a real month of transactions before you decide.
Who each suits
Xero tends to suit: sole traders who invoice a lot, want online payments and reminders, expect to grow into bills, payroll or add-ons, and have an accountant already in Xero.
MYOB Solo tends to suit: sole traders who want the cheapest proper set of books, work mostly from a phone, and are comfortable copying BAS figures into ATO online services. MYOB Business suits those who want the fuller product and prefer MYOB’s ecosystem or their accountant’s preference.
Both are safe choices. The wrong choice is the one you stop opening.
Where FlowFi fits
FlowFi is a third option built only for sole traders. It replaces bank feeds with statement upload: drop in a CSV or PDF and AI categorises every line, flags GST and deductions, and prepares each BAS label with a copy-guide for ATO Online, with invoicing, receipts, mileage and a cash-flow forecast around that. The trade-off is no live feed and no lodgement from the software; the gain is that most of the categorising is done for you and no bank login is ever stored. Pro is $29 a month or $290 a year, with a 14-day free trial and no card. See FlowFi vs Xero and FlowFi vs MYOB for the head-to-heads.
Prices and features were checked in September 2026 and change often. Confirm current plans on each provider’s website before deciding.
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Frequently asked questions
Can I switch from MYOB to Xero, or the other way, mid-year?
Yes. Both offer conversion tools and many accountants will do it. The cleanest time is the start of a financial year or a BAS quarter, with opening balances brought across.
Do I need the payroll features as a sole trader?
No. A sole trader without employees does not run payroll; your drawings are not wages. Only add payroll if you take on staff.
Which one do accountants prefer?
It varies by firm. Ask yours before choosing; using the platform your accountant knows best usually saves money at tax time.
General information only, not tax advice. Check your own situation with a registered tax agent or the ATO.
A third way: upload the statement, let AI do the categorising
If you would rather have AI categorise an uploaded statement than reconcile a bank feed, try FlowFi free for 14 days, no card.
Start 14-day free trial14 days of Pro free. No credit card. Then $29 a month or $290 a year.