In this video I’ll compare all of the
different versions of QuickBooks Online so that we can find out
what’s right for you. [Music] Hey there I’m James and welcome back to Accounting Stuff.
A little while ago I put up a video
where we walked through how to use QuickBooks Online.
We discussed a whole bunch of features that will help keep
your books in tip-top shape. However we skipped out
a vital part of the process because QuickBooks Online
comes in a few different shapes and sizes.
There used to be three different versions that
you could choose from but recently Intuit refreshed
their online plans so now we have four.
Simple start Essentials
Plus and Advanced and that’s excluding
QuickBooks Self Employed. So which one’s right
for your small business? I don’t know it’s confusing
so I decided to put together this little video to compare
all the different versions against one another
and then at the end I’ll recommend which
one’s right for you. So don’t miss out on that.
To be clear we’re going to be focusing on the US Edition
although most of the points will probably make sense
for other regions as well. You can click on the link
in the description to see a breakdown of all the different plans
that we’ll be talking about and I want to be fully transparent
this is an affiliate link so that means that if you end up
going ahead with the free trial or the discounted version
after clicking on it then I’ll make a small commission.
I want to keep creating accounting videos like this one
so this is one of the ways that you can support me doing that.
Anyway our focus today will be on maximising your
value for money. After all there’s no point
in paying for features that you aren’t going to use.
We’ll begin by taking a look at QuickBooks Self-Employed.
At 10 dollars per month or 17 if you chuck in TurboTax.
This is the cheapest cloud accounting product
that Intuit offers and I have a
love-hate relationship with it. Here’s why
If you’re a contractor a freelancer
or a sole proprietor of a small business then QuickBooks Self Employed
is a super convenient tool that you can use to track
your income and expenses. You can connect it up to
your bank accounts to import all of your transactions automatically
and the software makes it really easy to classify each one as
business or personal or split between the two.
This is useful if you bundle all of your work and personal transactions
through a shared bank account but more on that soon…
This process will allow you to track your business’s performance
through your income statement so you know how much profit you’re making.
Supporting these transactions with invoices and receipts can be a real pain
to do manually in spreadsheets but with QuickBooks Self Employed
you can simply drag and drop the support against each line item
and you also get access to a free app which you can use to snap,
allocate and store receipts on-the-go. Having an organised filing system like this
is a massive help when preparing your taxes
because you can easily provide backup for all of your transactions.
QuickBooks Self-Employed also gives you quarterly tax estimates
so you can prepare for what’s coming. Oh yeah and on top of all that
you can raise professional-looking invoices showing your business’s logo
and accept payments and the app allows you to accurately record
your business’s mileage using your phone’s GPS.
Very handy if you’re an uber driver. Sounds great doesn’t it?
Well… yes if you’ve been using spreadsheets
up till this point or you’ve been putting off your bookkeeping entirely
then QuickBooks Self-Employed is a total game changer.
But… and this is a big but it doesn’t scale.
QuickBooks Self Employed is a totally separate product from
QuickBooks Online so you can’t seamlessly upgrade it
if you end up needing more features. This will become a big problem
if you plan on expanding and growing your business in the future
because this software won’t grow with you and whilst I like a lot about
QuickBooks Self-Employed it’s also a very primitive product.
Double entry bookkeeping is one of the most important inventions
of the past 500 years and basically all major businesses use it to
record their transactions and report them in financial statements.
Well QuickBooks Self-Employed doesn’t do that. If you’re new to double entry accounting
and you’d like to learn more about it then don’t forget to subscribe
to this channel. I have a whole accounting basics playlist
up here that will help teach you it works. QuickBooks Self Employed also doesn’t
have any third-party app integration and no bank reconciliation feature
which me is a big no-no. QuickBooks Self-Employed definitely
has its place and for some people it might be perfect
but be warned it’s mainly aimed at
freelancers and contractors so if you run a small business
this probably isn’t for you. You will need to look into
QuickBooks Online instead. Which brings me on to Simple Start.
At $20 per month QuickBooks Simple Start is the
cheapest version that you can get your hands on.
It gives one user and an accountant the ability to track
your income and expenses which you can still categorise by type
in order to maximise your tax deductions. Simple Start also allows you
to download all of your banking transactions into one place
and you now have access to the bank rec feature
which is one of my personal favourite things about QuickBooks Online.
QuickBooks Online integrates with hundreds of third-party apps
so you can now work with TSheets, Expensify and Square in order to
save yourself time. It’s a bit harder to allocate
transactions between business or personal in
QuickBooks Online but I highly recommend avoiding that situation entirely
by keeping separate bank accounts for each. Even if you haven’t incorporated
set up a new bank account and keep these transactions totally separated
it’ll make your life so much easier. Plus further down the road
if you do decide to form a company you’ll have to do this anyway.
In simple start you also get access to the QuickBooks Online
mobile app which lets you snap and organise your receipts just like you
could in QuickBooks self-employed. You can also raise invoices and
accept payments which you can track in your sales tab.
Unfortunately you won’t be able to track your mileage anymore
like you could in QuickBooks self-employed but there are some third-party apps
that can help you work around this. The main benefit of Simple Start
is that it opens you up to the world of double-entry bookkeeping.
Why is that helpful? Well for starters
it allows you to track all of your assets and liabilities and equity
in your balance sheet. The balance sheet is one of the
basic financial reports that you can run in simple start.
If you’re interested to see what other reports you can run
here is a complete list I’ll drop a link to it down in the description.
The other benefit of simple start is that it’s totally scalable.
So if your business outgrows these basic features
you can upgrade seamlessly with a few clicks.
It’s worth considering this and planning for the future
when choosing your first accounting software package.
But who should avoid simple start? Businesses that need multiple users
or if you work with suppliers who offer you credit terms
then you might want access to the full accounts payable ledger.
Simple Start also doesn’t do any time or inventory tracking
so if you charge by the hour or sell physical products
then this might not be for you. You will need to look into
the other versions of QuickBooks Online which brings me on to
QuickBooks Online Essentials this is the level up from simple start
and includes all of the features I just mentioned and some.
The first major addition is accounts payable.
The ability to manage and track your bills. You can run an Accounts Payable
ageing summary to find out what you’ve got overdue
and you can now pay multiple bills at the same time
this is a big time saver if you receive a lot of these.
QuickBooks Online essentials also gives three team members access
to the platform and the ability to track time in timesheets.
Who should avoid essentials? Well at $40 per month it’s quite pricey
it’s double the cost of simple start. I would like to mention though
that QuickBooks Online now lets you downgrade if you decide
that you’re not using these extra features. I’ll drop link in the description to this
post which explains how you can do that.
If you sell physical products and you want to track them
then essentials still isn’t for you. You’ll want to look into
QuickBooks Online Plus instead. QuickBooks Online Plus gives you
access to full inventory tracking so you can set up inventory products
track them and receive notifications if you’re running low on stock.
This will help you quickly identify what’s in demand and create
purchase orders to replenish your inventory. Plus also lets you segment your reporting.
This is handy if you run a larger business with multiple locations or projects
and you want to monitor them all separately. However all of this comes at a hefty price tag $70 per month so I’d avoid paying for
QuickBooks Online Plus unless you absolutely have to.
Plus used to be Intuit’s top of the line product however they’ve now added a new one QuickBooks Online Advanced
aka the beast. I won’t go too much into depth on this one
because I haven’t had the opportunity to use it yet.
But QuickBooks Online advanced lets up to 25 users access the software
at the same time. It also includes the new
Fathom smart reporting feature which will help you track your KPIs
each month through some snazzy looking reports.
In this version you can also customise user permissions
get better customer service and access some free training.
Advanced is definitely aimed at medium to larger sized businesses
and that’s reflected in the price one hundred and fifty dollars per month Ouch it’s not for everyone. So which version of
QuickBooks Online is right for you? Well QuickBooks Self-Employed
is definitely the cheapest option at ten dollars per month
but it’s really only aimed at contractors and freelancers
with simple income streams. There’s no doubt that is a helpful tool
it will allow you to separate your business and personal transactions
and maximise your tax deductions but it’s really not set up for small business
because it doesn’t support double entry accounting and perhaps
most importantly it doesn’t scale.
So keep that in mind. Simple Start does scale
and at twenty dollars per month it’s the base level version
of QuickBooks Online and is probably best for
most small business owners who are just getting started.
You can easily upgrade it to a different package if you end up
needing those extra features. Simple Start is especially good
for solopreneurs who are selling services or digital products
and who are ok with having that single user access.
I’d consider the jump to essentials if you have a larger team
and need more users. At $40 per month it’s twice the cost
of simple start. You might also want to consider it
if you need that full accounts payable functionality.
Remember you can always start here and downgrade later
if you decide that it’s overkill. Again this one’s mainly for
service or digital based businesses that don’t need inventory tracking.
If selling physical products is your business then
QuickBooks Online Plus is your best bet at $70 per month it’s quite expensive
however for that price tag you’ll get 5 users and the ability
to track inventory across multiple locations. QuickBooks Online Advanced is for
medium to larger sized businesses at hundred and fifty dollars per month
it’s Intuit’s premium product and it could be worth considering
if you have a large team that requires more than five users.
The advanced smart reporting feature looks really neat
and it might be worth the dollars if you like fast visual analytics
to measure your performance. Remember you can use my affiliate link
down in the description to get access to that free trial
or the discount for all of these. Whichever you choose I do
recommend you get in touch with a pro advisor to help you along your way.
If you have no background in accounting then it can be easy to make mistakes
without having the proper guidance. Check out this video on
how to use QuickBooks Online for a more in-depth look at
some of the features and don’t forget to subscribe for more
QuickBooks and Accounting tutorials and as always if you’ve got any questions
hit me up in the comments or message me directly on instagram