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Accounting · head to head

Microsoft Excel vs Xero

Microsoft Excel logo

Microsoft Excel

Accounting

Spreadsheet software for data analysis and visualization

From
Free
Rated
-
Full reviewWebsite
Xero logo

Xero

Accounting

Beautiful accounting software

From
$13/month
Rated
-
Full reviewWebsite

The short version

  • Only Microsoft Excel has a free tier, so it costs nothing to try first.
  • Each has a real cost: Microsoft Excel free tier limited to 5 GB cloud storage and web-only access; Xero the Early plan caps you at 20 invoices and 5 bills per month, and the invoice limit counts both approving and sending
  • They diverge on capability: Microsoft Excel covers Advanced formulas, Xero covers Bank reconciliation.
  • Prices and features above were last checked on 30 August 2026.

Where they differ

Only the attributes on which Microsoft Excel and Xero actually diverge.

Attributes where Microsoft Excel and Xero differ
AttributeMicrosoft ExcelXero
Starting priceFree$13/month
Pricing modelfreemiumsubscription
Free tierYesNo
PlatformsWindows, Macos, Web, Ios, AndroidWeb, Ios, Android, Api
Founded19752006

Identical on both: user rating (Not yet rated), category (Accounting).

What each one covers

Drawn from each product's published feature list. An absence here means we hold no record of it - not that the product lacks it.

Only in Microsoft Excel

  • Advanced formulas
  • Pivot tables
  • Data visualization
  • Charts and graphs
  • Conditional formatting
  • Data analysis tools
  • Macro automation
  • Collaboration features

Only in Xero

  • Bank reconciliation
  • Invoicing
  • Bill payment
  • Expense claims
  • Financial reporting
  • Inventory tracking
  • Project tracking
  • Mobile apps

Both cover

  • Data encryption

What people use each for

The jobs each tool is most often brought in to do.

Microsoft Excel

  • Financial modelingnot Xero
  • Data analysisnot Xero
  • Budget planningnot Xero
  • Reportingnot Xero
  • Business intelligencenot Xero
  • Statistical analysisnot Xero

Xero

  • Small business bookkeeping, invoicing and bank reconciliationnot Microsoft Excel
  • Bill payment and purchase order managementnot Microsoft Excel
  • Sharing books with an accountant or bookkeepernot Microsoft Excel

Where each one falls short

Documented limitations, not opinions. Every one is a constraint you would hit in normal use.

Microsoft Excel

  • Free tier limited to 5 GB cloud storage and web-only access
  • Paid plans have per-user costs increasing significantly with more users
  • AI features like Copilot limited or unavailable on lower-tier plans

Xero

  • The Early plan caps you at 20 invoices and 5 bills per month, and the invoice limit counts both approving and sending
  • Invoices created by connected app partners count against the Early plan invoice limit
  • Multiple currencies, project time and cost tracking, employee expense and mileage claims and industry benchmarking are restricted to the top Established plan at $90 per month
  • Cash flow forecasting is capped at 30 days on Early and 60 days on Growing, with 180 days only on Established
  • Payroll is not included in any plan and costs an extra $36 a month plus $6 per employee or contractor through Gusto
  • Inventory Plus is a paid optional add-on rather than part of any plan
  • The advertised 90% off applies only to the first 6 months, after which the regular $25, $55 or $90 monthly price auto-renews
  • The introductory discount excludes add-ons, usage charges and payment fees
  • Payment fees apply to online invoice payments and to bill payments other than standard domestic ACH, and are billed on top of the subscription
  • Subscriptions are billed monthly with no annual payment option, and after upgrading you must wait one month before downgrading to a cheaper plan
  • Xero states subscription prices are increasing from October 1, 2026

Pricing, plan by plan

Microsoft Excel

Free
  • Microsoft Excel (Free)Free
    • Excel for the web
    • Real-time collaboration
    • 5 GB cloud storage
  • Microsoft 365 Personal$9.99/month
    • Desktop Excel app
    • 1 TB cloud storage
    • Single user on up to 5 devices
  • Microsoft 365 Family$12.99/month
    • 1-6 users (AI features for subscription owner)
    • Up to 6 TB cloud storage (1 TB per person)
    • Each user up to 5 devices
  • Microsoft 365 Premium$19.99/month
    • 1-6 users
    • Extensive Copilot feature access
    • Exclusive advanced AI capabilities

Xero

$13/month
  • Early$13/month
    • Send 20 invoices
    • Enter 5 bills
    • Reconcile bank transactions
  • Growing$37/month
    • Unlimited invoices & bills
    • Bulk reconcile transactions
    • Short-term cash flow
  • Established$70/month
    • Everything in Growing
    • Use multiple currencies
    • Track projects

Which should you pick?

Choose Microsoft Excel if

  • You need advanced formulas.
  • You want to start without paying.
  • You work on Windows, Macos, Web, Ios, Android.
  • You also want pivot tables.
Microsoft Excel review

Choose Xero if

  • You need bank reconciliation.
  • You work on Web, Ios, Android, Api.
  • You also want invoicing.
Xero review

Questions people ask

Is Microsoft Excel or Xero better?
Neither clearly leads. Microsoft Excel starts at Free and Xero at $13/month, and user ratings are close enough to be indistinguishable. Choose on capability and platform support.
Which is cheaper, Microsoft Excel or Xero?
Microsoft Excel has a free tier; the other does not. Paid plans start at Free for Microsoft Excel and $13/month for Xero.
Does Microsoft Excel or Xero run on more platforms?
Microsoft Excel runs on Windows, Macos, Web, Ios, Android. Xero runs on Web, Ios, Android, Api.
Can I use Microsoft Excel for free?
Yes. Microsoft Excel has a free tier, so you can try it without paying. Xero starts at $13/month.
What is Microsoft Excel best used for?
Microsoft Excel is most often used for financial modeling, data analysis, budget planning, reporting. Of those, financial modeling and data analysis are not what Xero is typically brought in for.
What can Microsoft Excel do that Xero cannot?
Microsoft Excel covers Advanced formulas, Pivot tables, Data visualization, Charts and graphs. Xero covers Bank reconciliation, Invoicing, Bill payment, Expense claims. Both handle Data encryption.

Answered from the vendors’ own pages

Microsoft Excel: How much does Microsoft Excel cost?

Microsoft Excel is free as a web app with 5 GB storage. Paid options include Microsoft 365 Personal at $9.99/month for desktop apps and 1 TB storage, Family at $12.99/month for 1-6 users with 6 TB total storage, and Premium at $19.99/month with extended Copilot access.

Source
Microsoft Excel: Is there a free version of Excel?

Yes, Excel for the web is free and includes sharing, real-time collaboration, and 5 GB cloud storage accessible on web, iOS, and Android without subscription.

Source
Microsoft Excel: What is the difference between Microsoft 365 Family and Premium tiers?

Family tier at $12.99/month supports 1-6 users with 6 TB total storage and standard features. Premium tier at $19.99/month allows extensive Copilot feature access and exclusive advanced AI capabilities including image creation and audio generation.

Source
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