QuickBooks Online has three levels of online accounting choices: Simple Start(free version), Basic, and Plus. Before making your decision to use QuickBooks Online, you should decide between QuickBooks Online Basic or QuickBooks Online Plus. This article will discuss the differences between these two QuickBooks Online options. Ultimately, you are responsible for ensuring that you select the correct version which should be tailored to the business that you operate. There is also a free version called QuickBooks Online Simple Start. The free version was not considered for this analysis because of its limited capabilities. QuickBooks Online Basic will be collectively referred to as “BASIC” and QuickBooks Online Plus as “PLUS”. Give the the free version a try, since it does a provide an introduction to QuickBooks with limited customer activity. However, it’s good if you want to write up a full year’s transactions without customer and vendor activity. You should give it a try by going to Intuit’s website. Each major difference and brief comment regarding the option’s capability is discussed below:
The following discusses the capabilities that work only with Plus:
Importing -Plus allows you to import your Simple Start Edition, QuickBooks Online Basic, QuickBooks Pro or Premier Edition file(s) into PLUS only. Unfortunately this import feature does not work with a Mac.
Estimates – Estimates are important to avoid misunderstandings and can be created and then seamlessly imported to an invoice for billing. This feature is only available in PLUS.
Online Banking – With online banking, payments and receipts do not have to be entered into your QB register. Instead of entering your transactions, you only have to review them as they appear after the download in the QuickBooks check register. When you download QuickBooks compares it then compares the bank’s transactions to the transactions in QuickBooks and identifies discrepancies. It assists you in managing your cash flow, because you always know which checks have cleared the bank, which means you know how much money you have in real time. This feature is only available in PLUS.
Exporting – You can export transactions and balances to a Microsoft Excel spreadsheet only in PLUS. This is a very important feature, since it adds greater reporting capabilities. It gives you flexibility is obtaining and analyzing different types of financial data .
Class tracking – This is very similar to business tracking which is discussed below. This feature is only available in PLUS. Classes allow you to categorize transactions by using classes. With classes you are able to categorize each detail line on a transaction. By way of example, you can write one check to the office supply supplier for items bought for two different business units while being able to track each business unit for those purchases. For example, if you have a consulting firm and an affiliate marketing business. Class tracking is ideal for you, since it common to have purchases and sales that include both types of work. By specifying the appropriate class on each detail line, you can produce a Profit & Loss by Class report that will inform you if your consulting business is more or less profitable than the affiliate marketing business.
Business tracking – With PLUS you can categorize data from different locations, offices, regions, or outlets of your company. You are able to assign each transaction to a business. By assigning a business to each transaction as you enter it, you can later see businesses on reports with great detail and clarity. Assigning businesses also lets you efficiently manage groups of transactions.
Time tracking – With Plus you can enter your time into a time sheet when you bill by the hour i.e. consultants, website developers, SEO’s, freelancers, sole proprietors, etc. This feature is only offered in PLUS.
Invoicing – Plus also permits you to customize the invoice.This is another reason to try both to see what works for you.
Reporting and Financial Statements – BASIC provides 40 standard reports whereas PLUS provides over 65 standard reports plus customization and formatting. A comprehensive analysis in a chart format of the reporting differences can be found at Intuit’s knowledge base for comparison of the QuickBooks Online Products.
Budgeting – You can use a budget to estimate future income and expenses. Moreover, PLUS budgets’ uses a format similar to a spreadsheet, with a horizontal row for each of your income and expense accounts, and vertical columns for each month or quarter. This feature is only in PLUS
1099 Reporting – The regulations of the Internal Revenue Service require that a taxpayer issue a 1099-MISC form to its workers for nonemployee compensation providing the payer is a trade or business and the payments are to a noncorporate entity were $600 or more for services rendered. This feature is only offered in PLUS.
Users-BASIC provides access for one person and your accountant (2 users). However, PLUS provides access for 3 users PLUS your accountant for a total of 4 users. Plus can be expanded to 25 users for an additional cost, which is reasonable.
Support – BASIC includes email support provided by Intuit whereas PLUS includes callback and chat support as well as email support . Obviously, PLUS support is better, but with BASIC you can still get your questions answered.
Price – BASIC costs $9.99 a month as compared to PLUS which according to the Intuit website is $34.95 per month. However, if you purchase PLUS by using a Certified QuickBooks ProAdvisor you can purchase it for $21, which is net of a discount 40% discount, which is currently in effect at this time. Discounts and prices may change in the future. There are no annual contracts.
Summary – BASIC works satisfactorily for smaller companies, whereas PLUS works well for small to midsized companies. Prior to making your decision, you can test drive the software for 30 days for either or both BASIC and PLUS and, then decide which is the best software platform for your business. They are other disadvantages when considering BASIC and PLUS to a Desktop QuickBooks i.e. Pro, Premier, etc. The most significant disadvantage is that the Online versions do not provide inventory functionality. You may be able to overcome this disadvantage by purchasing an inventory add on. Prior making a decision of software selection its important for you to have a discussion with your CPA or accountant concerning which QuickBooks Online accounting package is best suited for you and your business.
Learn how QuickBooks Online offers the essential online accounting tools to manage your business and the freedom to access your financials from work, home, or the on the road,. Sandor Lenner, C.P.A. has been providing accounting services for 35 years. He is also a Certified QuickBooks Pon the road,visor and works as a part-time small business consultant for a Miami Accounting CPA firm.
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