TLDR (Summary)
The best time tracking software for small business is Plutio ($19/month).
Standalone time tracking creates records that need manual transfer to billing. Small businesses need time tracking that connects directly to invoicing-where tracked hours become invoice line items without exports or reconciliation.
According to industry research, professionals lose an average of 2.5 billable hours per day to poor tracking practices. When time tracking connects to invoicing, every hour gets captured and billed accurately.
What is time tracking software for small business?
Time tracking software for small business records work hours while connecting tracked time to billing and project management.
What time tracking does
Core functions include starting and stopping timers on tasks, logging hours manually when needed, categorizing time by project or client, and providing reports on how time gets spent.
Small businesses typically track time using spreadsheets, paper timesheets, or mental estimates. A local consulting firm might use Excel spreadsheets where team members log hours weekly, requiring manual entry and calculation. The manual process creates opportunities for errors and makes billing time-consuming because tracked hours must transfer to invoicing systems separately. Time tracking software automates recording and connects to billing, eliminating manual transfer work.
A 5-person web design agency tracks time across 10 active projects, with team members logging hours in spreadsheets that get compiled weekly. The process takes 2-3 hours per week and creates risk of missed billable time. Time tracking software reduces this to minutes while ensuring every tracked hour connects to billing automatically.
Timesheets vs time tracking software
Spreadsheet timesheets require manual entry with no connection to projects or billing. Time tracking software connects to business operations. The difference: isolated records vs integrated workflow.
Spreadsheet timesheets create isolated records that require manual transfer to invoicing systems. A local marketing agency uses Excel timesheets where team members log hours, then someone manually transfers those hours to invoice line items. The transfer process takes time and creates opportunities for errors where billable hours get lost or misallocated.
Time tracking software connects to business operations automatically. When team members track time on tasks, those entries link to projects and clients automatically. Creating invoices pulls tracked hours directly, eliminating manual transfer work. A local consulting firm uses connected time tracking so billable hours flow into invoices with one click, ensuring every tracked hour becomes revenue without reconciliation.
When time tracking connects to invoicing, every tracked hour has a clear path to revenue. Lost billable time and reconciliation errors drop to zero.
Why small businesses need time tracking software
Small businesses billing for time-whether hourly or project-based-need systematic tracking or revenue gets lost.
The leakage problem
"Did I bill for that call?" "How long did that revision take?" Without real-time tracking, billable work gets forgotten. Each missed hour is direct revenue loss.
A local consulting firm bills hourly but tracks time mentally or in notes. When invoicing time, they estimate hours based on memory, missing 2-3 billable hours per week on average. At $150/hour, that's $300-450 weekly in lost revenue, or $15,000-23,000 annually. Time tracking software captures every billable minute, protecting revenue that mental tracking misses.
The leakage problem compounds when team members track time inconsistently. A 5-person design agency has some team members logging hours daily while others track weekly, creating gaps where billable work gets forgotten. Systematic time tracking ensures consistent capture across all team members, protecting revenue that inconsistent tracking loses.
The estimation problem
Project profitable or not? Without time data, you're guessing. Tracked hours show actual cost and inform better estimates for future work.
Project estimation requires understanding how long work actually takes. A local marketing agency estimates website projects at 40 hours but has no data on actual time spent. Without tracking, they can't know if estimates are accurate or if projects are profitable. Time tracking provides data showing actual hours versus estimates, enabling better pricing for future work.
Estimation accuracy improves with historical time data. A local consulting firm tracks time on all projects, comparing actual hours to estimates. After 20 projects, patterns emerge: discovery phases take 8 hours consistently, implementation takes 25 hours, and revisions average 5 hours. Data informs better estimates that reflect actual work requirements, improving project margin analysis.
The billing problem
Separate tracking and invoicing means manual transfer at billing time. Exports, matching, reconciliation. Time tracking tools that connect to invoicing eliminate the handoff.
Manual transfer between tracking and invoicing creates work and errors. A local design studio tracks time in Toggl, then exports entries weekly to create invoice line items manually. Process takes 2-3 hours weekly and creates risk of missed entries or incorrect allocations. Connected time tracking eliminates this handoff by flowing tracked hours directly into invoices.
Reconciliation between tracking and invoicing systems consumes time and creates opportunities for errors. A local marketing agency tracks time in Harvest, then manually matches entries to projects in FreshBooks for invoicing. Matching process takes 1-2 hours weekly and sometimes misses entries or allocates time incorrectly. Time tracking software that connects to invoicing eliminates reconciliation by integrating both systems.
The visibility problem
Without time tracking, small businesses lack visibility into where time actually goes. A local consulting firm might think client work takes 60% of time, but tracking reveals it's actually 40%, with internal work consuming more than expected. Visibility helps small businesses understand operations and make informed decisions about pricing, staffing, and project scoping.
Time tracking is revenue protection for billable work and cost visibility for all work. Every minute tracked is a minute understood.
Time tracking features small businesses need
Essential time tracking features balance ease of use with billing accuracy.
Core features
- Timer: Start/stop tracking on tasks. Real-time capture of work.
- Manual entry: Log hours after the fact when timers weren't running.
- Project/task assignment: Categorize time by where it was spent.
- Billable marking: Distinguish billable from non-billable hours.
Timer functionality enables real-time tracking by starting and stopping timers on tasks as work happens. A local consulting firm uses timers to track client calls, project work, and administrative tasks, capturing time accurately as it occurs rather than relying on memory. Timer tracking reduces missed billable time by making recording frictionless: click to start, click to stop, time gets captured automatically.
Manual entry accommodates situations where timers weren't running, such as phone calls or impromptu meetings. A local design studio uses manual entry to log time for client calls that happened without timer tracking, ensuring billable time gets captured even when timers weren't started. Flexibility ensures complete time capture regardless of tracking method.
Small business-specific features
- Invoice creation: Generate invoices directly from tracked time.
- Approval workflow: Review team entries before billing.
- Rate management: Different rates for different projects or activities.
- Project margin analysis: Compare tracked hours to project budgets.
Invoice creation from tracked time eliminates manual transfer work by flowing billable hours directly into invoices. A local marketing agency selects billable time entries for a client, creates an invoice, and entries become line items automatically. Connection ensures every tracked hour becomes revenue without reconciliation, protecting billable time that manual transfer might miss.
Approval workflow enables review of team time entries before billing, ensuring accuracy and quality control. A local consulting firm uses approval workflow to review team entries weekly, catching errors and adjusting descriptions before invoicing. Review process maintains billing quality while ensuring team members track time accurately.
Rate management supports different billing rates for different projects or activities. A local design studio uses rate management to bill website projects at $150/hour and branding work at $125/hour, ensuring accurate invoicing based on work type. Flexibility accommodates varied pricing structures that small businesses often need.
Project margin analysis compares tracked hours to project budgets, showing margin analysis and estimation accuracy. A local consulting firm uses margin analysis to see which projects exceeded budgets and which came in under estimates, informing better pricing for future work. Visibility helps small businesses understand project margin analysis and improve estimation over time.
The value multiplier is invoicing connection. Time tracking that creates invoices directly eliminates the gap where billable hours get lost.
Time tracking software pricing for small business
Time tracking software ranges from free to $18/user/month, with full workflows requiring additional tools.
Typical pricing
- Toggl: $9-18/user/month. Tracking only, no invoicing.
- Harvest: $12/user/month. Time and basic invoicing.
- Clockify: Free-$12/user/month. Tracking focus.
Plutio pricing (February 2026)
- Core: $19/month-time tracking plus invoicing, project management, CRM, proposals.
- Pro: $49/month-unlimited tracking and invoicing, up to 30 team members.
- Max: $199/month-unlimited team, advanced reporting.
Per-user time tracking pricing scales quickly with team size. Plutio's flat pricing includes complete time-to-invoice workflow.
Why Plutio is the best time tracking software for small business
Plutio handles time tracking as part of complete business operations where tracked hours flow into invoices and project reports.
Timer and manual entry
Start timers on tasks with one click. Running timer shows elapsed time. Forgot to track? Add entries manually with date, duration, and description.
Timer functionality enables real-time tracking by starting and stopping timers on tasks as work happens. A local consulting firm uses timers to track client calls, project work, and administrative tasks, capturing time accurately as it occurs. Timer tracking reduces missed billable time by making recording frictionless: click to start, click to stop, time gets captured automatically with task and project context.
Manual entry accommodates situations where timers weren't running, such as phone calls or impromptu meetings. A local design studio uses manual entry to log time for client calls that happened without timer tracking, ensuring billable time gets captured even when timers weren't started. Manual entries include date, duration, description, and project assignment, creating complete records regardless of tracking method.
Connected to tasks and projects
Every time entry links to a task and project. See where time goes at the task level and the project level. Understand how work gets done.
Task and project connection ensures time entries link to specific work, creating visibility into where time actually goes. A local marketing agency tracks time on tasks within projects, seeing how much time goes to design, development, and revisions. Visibility helps understand work patterns and identify tasks that take longer than expected.
Project-level visibility shows total time per project, enabling comparison to budgets and estimates. A local consulting firm uses project connection to see total hours per project, comparing actual time to estimates to understand accuracy and margin analysis. Data informs better pricing for future work based on actual time requirements.
Billable and non-billable
Mark entries as billable or non-billable. Internal work tracked separately from client work. Accurate billing and accurate cost understanding.
Billable marking distinguishes client work from internal activities, ensuring accurate invoicing while tracking all time for cost understanding. A local design studio marks client project work as billable and internal meetings as non-billable, ensuring invoices only include client time while tracking total time for cost analysis.
Non-billable tracking helps small businesses understand internal time costs. A local consulting firm tracks non-billable time for team meetings, training, and administrative work, understanding total time investment beyond billable hours. Visibility helps make informed decisions about pricing and resource allocation.
Invoice from time
Select billable entries, create invoice. Entries become line items with descriptions, hours, and rates. No exports, no spreadsheets, no reconciliation.
Invoice creation from tracked time eliminates manual transfer work by flowing billable hours directly into invoices. A local marketing agency selects billable time entries for a client, creates an invoice, and entries become line items automatically with descriptions, hours, and rates. Connection ensures every tracked hour becomes revenue without reconciliation, protecting billable time that manual transfer might miss.
One-click invoicing reduces billing time from hours to minutes. A local consulting firm uses invoice-from-time functionality to create invoices in 5 minutes instead of 30 minutes, saving 25 minutes per invoice while ensuring accuracy. Time savings compounds across multiple clients, making billing efficient while protecting revenue.
Approval workflow
Review team time entries before billing. Catch errors, adjust descriptions, approve for invoicing. Quality control on billable time.
Approval workflow enables review of team time entries before billing, ensuring accuracy and quality control. A local design studio uses approval workflow to review team entries weekly, catching errors and adjusting descriptions before invoicing. Review process maintains billing quality while ensuring team members track time accurately.
Workflow review catches common issues: incorrect project assignments, missing descriptions, or entries that need clarification. A local consulting firm uses approval workflow to ensure time entries have clear descriptions that clients understand, improving invoice clarity and reducing payment delays.
Project margin analysis
Compare tracked hours to project budgets. Which projects are profitable? Which took more time than expected? Data for better pricing and estimation.
Project margin analysis compares tracked hours to project budgets, showing margin analysis and estimation accuracy. A local marketing agency uses margin analysis to see which projects exceeded budgets and which came in under estimates, informing better pricing for future work. Visibility helps small businesses understand project margin analysis and improve estimation over time.
Margin data reveals patterns that inform pricing decisions. A local consulting firm tracks margins across 20 projects and discovers that discovery phases consistently take longer than estimated, while implementation phases come in under budget. Data informs better estimates that reflect actual work requirements, improving project margin analysis.
Time tracking becomes revenue when it connects to invoicing. Every tracked hour has a path to an invoice without manual handoff.
How to set up time tracking in Plutio
Setting up time tracking takes 30-60 minutes for configuration.
Step 1: Configure billing rates
Set default hourly rates. Configure project-specific or client-specific rates where needed.
Rate configuration establishes billing rates for time entries, ensuring accurate invoicing. A local consulting firm sets default rates at $150/hour, then configures project-specific rates: website projects at $150/hour, branding work at $125/hour, and consulting calls at $175/hour. The configuration ensures invoices reflect correct rates based on work type.
Client-specific rates accommodate different pricing for different relationships. A local design studio uses client-specific rates for retainer clients who pay lower hourly rates in exchange for ongoing commitments. Flexibility supports varied pricing structures that small businesses often need.
Step 2: Enable tracking on projects
Turn on time tracking for relevant projects. Set project budgets to compare actual hours against estimates.
Project tracking configuration enables time tracking on projects where billing depends on hours. A local marketing agency enables tracking on all client projects, setting budgets based on estimates. When team members track time, entries link to projects automatically, and margin analysis compares actual hours to budgets.
Budget setting enables margin analysis that shows project margin analysis. A local consulting firm sets project budgets at estimated hours, then compares actual tracked hours to understand accuracy and margin analysis. Comparison informs better estimates for future work based on actual time requirements.
Step 3: Train team on tracking
Show team members how to start timers and log manual entries. Establish tracking habits early.
Team training ensures consistent tracking across all members. A local design studio trains team members on timer usage and manual entry, establishing habits that capture all billable time. Training includes demonstrating timer start/stop, manual entry creation, and project assignment, ensuring everyone tracks time correctly.
Habit establishment happens through consistent use and reminders. A local consulting firm establishes tracking habits by requiring daily time entry, sending weekly reminders, and reviewing entries regularly. Consistency ensures complete time capture that protects revenue.
Step 4: Configure approval workflow
If using team time, set up approval process for entries before invoicing.
Approval workflow configuration enables review of team entries before billing, ensuring accuracy and quality control. A local marketing agency sets up weekly approval workflows where managers review team entries, catch errors, adjust descriptions, and approve entries for invoicing. Review process maintains billing quality while ensuring team members track time accurately.
Workflow configuration includes setting review schedules, defining approvers, and establishing approval criteria. A local consulting firm uses daily approval workflows for high-value projects and weekly reviews for standard work, ensuring important time gets reviewed promptly while maintaining efficiency.
Step 5: Test invoice creation
Test invoice creation from tracked time to verify the complete workflow functions correctly. Create test time entries, generate an invoice, and verify entries become line items accurately. The testing ensures the time-to-invoice connection works smoothly before using with real clients.
Good setup creates tracking habits. Consistent tracking produces accurate billing and reliable project data.
Creating invoices from tracked time
Connected invoicing transforms time entries into revenue without manual transfer.
Invoice creation flow
- Review billable time entries for a client or project
- Mark entries to include on invoice
- Create invoice-entries become line items
- Send invoice to client
Invoice creation flow starts with reviewing billable time entries for a client or project. A local marketing agency reviews entries weekly, selecting billable time to include on invoices. Marking entries for inclusion creates a list of time to bill, then creating the invoice converts entries into line items automatically.
Invoice generation converts selected entries into line items with descriptions, hours, rates, and totals. A local consulting firm uses this flow to create invoices in 5 minutes instead of 30 minutes, saving 25 minutes per invoice while ensuring accuracy. Time savings compounds across multiple clients, making billing efficient while protecting revenue.
What transfers
- Entry description becomes line item description
- Hours and rate calculate line total
- Project and task context for client clarity
Entry descriptions transfer to invoice line items, ensuring clients see what work was performed. A local design studio uses detailed descriptions like "Website homepage design and revisions" so clients understand what they're paying for. Clarity reduces payment delays and client questions.
Hours and rates calculate line totals automatically, ensuring accurate invoicing without manual calculation. A local consulting firm tracks time at different rates for different activities, and invoice creation calculates totals correctly based on entry rates. Automation eliminates calculation errors that manual invoicing might create.
Project and task context appears on invoices, helping clients understand how time relates to their projects. A local marketing agency includes project names and task descriptions on invoices, creating clear connections between tracked time and project deliverables. Context improves invoice clarity and client understanding.
Billing efficiency and accuracy
Connected invoicing eliminates manual transfer work that consumes time and creates errors. A local design studio previously spent 2-3 hours weekly transferring time entries from Toggl to FreshBooks, creating risk of missed entries or incorrect allocations. Connected time tracking eliminates this transfer, reducing billing time while ensuring accuracy.
One-click invoicing protects revenue by ensuring every tracked hour becomes billable. A local consulting firm uses connected invoicing to capture all billable time, preventing the 2-3 hours weekly that manual transfer might miss. Protection adds $300-450 weekly in captured revenue, or $15,000-23,000 annually.
One-click invoicing from tracked time means every billable hour finds its way to an invoice. Forgotten entries and missed revenue drop to zero.
Time tracking reports and analysis
Time data reveals patterns that improve pricing, estimation, and team efficiency.
Available reports
- By project: Hours per project with budget comparison.
- By client: Time investment per relationship.
- By team member: Individual productivity and allocation.
- By period: Weekly, monthly, quarterly trends.
Project reports show hours per project with budget comparison, enabling margin analysis that reveals margin analysis. A local marketing agency uses project reports to see which website projects exceeded budgets and which came in under estimates, informing better pricing for future work. Visibility helps small businesses understand project margin analysis and improve estimation over time.
Client reports show time investment per relationship, helping small businesses understand relationship value. A local consulting firm uses client reports to see total hours per client annually, identifying high-value relationships that deserve priority attention. Visibility enables relationship management based on actual time investment.
Team member reports show individual productivity and allocation, helping small businesses understand team capacity and workload distribution. A local design studio uses team reports to see how team members allocate time across projects, identifying capacity constraints and workload imbalances. Visibility helps make informed decisions about staffing and project assignment.
What data reveals
- Which projects have strong margins vs which don't
- Which tasks take longer than expected
- Where team time actually goes
- How to price similar work in the future
Margin analysis compares tracked hours to project budgets, revealing which projects generate profit and which consume more time than revenue justifies. A local marketing agency analyzes 20 projects and discovers that branding projects consistently exceed budgets while website projects come in under estimates. Data informs better pricing that reflects actual work requirements.
Task duration analysis shows which tasks take longer than expected, revealing work patterns that inform estimation. A local consulting firm tracks task durations across projects and discovers that discovery phases consistently take 8 hours instead of estimated 5 hours. Data informs better estimates that reflect actual work requirements.
Time allocation analysis reveals where team time actually goes, helping small businesses understand operations. A local design studio tracks time allocation and discovers that client work takes 60% of time while internal work consumes 40%, informing decisions about pricing and resource allocation.
Pricing data accumulates over time, creating historical information that informs future estimates. A local consulting firm tracks time across 30 projects and builds a database of actual hours for different project types. Data enables better pricing that reflects actual work requirements, improving project margin analysis.
Report usage and review
Regular report review helps small businesses understand operations and make informed decisions. A local marketing agency reviews project reports monthly to identify margin analysis trends, task duration patterns, and estimation accuracy. Review informs pricing adjustments and process improvements that increase margin analysis.
Time data is business intelligence. Every tracked hour contributes to understanding that improves future decisions.
How to migrate time tracking to Plutio
Migration from another time tracking tool focuses on process change, not historical data.
Migration approach
- Set up Plutio time tracking with correct rates and projects
- Export and archive old data for reference if needed
- Start all new tracking in Plutio
- Establish team habits in the new system
Migration starts with setting up Plutio time tracking with correct rates and projects. A local marketing agency migrates from Toggl by configuring billing rates, enabling tracking on active projects, and setting project budgets. Setup takes 30-60 minutes and ensures new tracking works correctly with invoicing connection.
Historical data export preserves past time records for reference without recreating them in Plutio. A local consulting firm exports 6 months of historical data from Harvest, archiving it for reference on past projects. The export preserves historical information without requiring recreation in the new system.
New tracking starts immediately in Plutio, establishing habits that capture all billable time going forward. A local design studio trains team members on Plutio tracking, establishing daily habits that ensure complete time capture. Habit establishment happens through consistent use and reminders.
Process change and habit establishment
Migration creates process change that requires habit establishment. A local marketing agency migrates from manual spreadsheet tracking to Plutio, training team members on timer usage and manual entry. Training establishes habits that capture all billable time while connecting to invoicing automatically.
Habit establishment happens through consistent use, reminders, and review. A local consulting firm establishes tracking habits by requiring daily time entry, sending weekly reminders, and reviewing entries regularly. Consistency ensures complete time capture that protects revenue.
Invoicing connection benefits
Migration to Plutio enables invoicing connection that eliminates manual transfer work. A local design studio previously spent 2-3 hours weekly transferring time entries from Toggl to FreshBooks. Plutio migration eliminates this transfer, reducing billing time while ensuring accuracy through automatic connection.
Historical time data has limited ongoing value. Focus on setting up accurate tracking going forward with proper invoicing connection.
