Cell-free massive multiple-input multiple-output (MIMO) is considered as a promising technology for satisfying higher rate requirement of users in beyond-5G networks. This paper investigates the impact of phase noise on the performance of cell-free MIMO systems which employ a large number of multi-antenna access points (APs). For both downlink and uplink transmissions, we derive the tractable closed-form achievable rate expressions when signal detection with channel state information (CSI) and channel distribution information (CDI), respectively, by utilizing the extended deterministic equivalence method in random matrix theory. The closed-form achievable rate expressions provide efficient evaluation for the impact of phase noise on system performance. The analytical results indicate that the phase noise influences the power of the desired signal, the beamforming uncertainty gain, and the inter-user interference increment caused by the pilot contamination. In addition, the special cases that only APs have phase noise and only users have phase noise are discussed. It is found that the impact of phase noise at users is more severe than that at APs. Besides, we discuss the system performance at low and high SNR regimes. It demonstrates that the phase noise is the major limitation of the system performance in high SNR regime while it can be neglected in low SNR regime. Furthermore, we formulate the max-min power control problem for both downlink and uplink transmissions to guarantee the users’ fairness and prove that the downlink max-min problem is a quasi-concave problem while the uplink max-min problem is a geometric programming (GP) problem. Then, the phase noise-aware max-min power control schemes for both downlink and uplink transmissions are proposed to ensure the users’ fairness. Finally, numerical results are provided to validate the analytical results and the proposed phase noise-aware power control scheme.