QuickBooks is an accounting and finance software that is geared toward small, mid-size, new, and freelance businesses. It is used by businesses for its accounting tools to track and manage the money coming in and going out. QuickBooks builds reports and gives you financial results to help with decision making for your business’s future. Features include accounting, inventory, payroll, tax filing, invoicing, bank account tracking and reconciliation, expense management, budgeting, payment processing, and more. QuickBooks offers both a Desktop and Online software both designed to fit your accounting needs.
What are the differences between QuickBooks Online and QuickBooks Desktop?
Whether you currently use QuickBooks and are wondering if you should switch to a different version, or you are just starting out; it is important to know the differences between QuickBooks Desktop and QuickBooks online.
- Accessibility: This is the biggest difference between the two
- QuickBooks online: cloud-based and can be accessed using the internet, on any device, and through a mobile app
- QuickBooks Desktop: Downloaded and installed onto a computer, fee for hosting on other devices, and has a limited mobile app
- Pricing
- QuickBooks Online offers 4 different monthly plans
- Simple start: $25 per month
- Essentials: $50 per month
- Plus: $80 per month
- Advanced: $180 per month
- QuickBooks Desktop offers 3 different annual plans
- Pro plus: $349.99 per year for one user
- Premier plus: $549.99 per year for one user
- Enterprise: $1,340 per year for one user
- QuickBooks Online offers 4 different monthly plans
- Users
- QuickBooks Online: Offers a set number of users depending on your plan, the highest plan can have up to 25 users. These users can access the program simultaneously.
- QuickBooks Desktop: has subscriptions set for one user at a time, but you can add up to 40 users with a fee per user.
- Features
- QuickBooks Online: QuickBooks Online has more automated features that allow you to manage your data quicker and more efficiently. QBO is better for invoicing customers because it has the ability to do things like automatically calculate sales tax depending on customer location. It also integrates third-party payment processors so that your customers can directly pay invoices online.
- QuickBooks Desktop: Has more developed features. While the online version has similar features to Desktop, some of them, such as inventory, are not as developed. Desktop allows users to access more advanced inventory management features as well as more advanced reporting.
- Online Payment: similar between the two
- With QuickBooks Payments there are small fees based on ACH transfers and credit card transactions. QuickBooks payments can be used by desktop users to allow their customers to pay online when you connect your QuickBooks Payments account to your desktop.
| Type of Fee | QuickBooks Online | QuickBooks Desktop (pay as you go) | QuickBooks Desktop (monthly plan) |
| Monthly Fee | $0 | $0 | $20 |
| ACH Bank Transfer | 1% (max $10) | $3.00 | $3.00 |
| Credit Card (swiped) | 2.4% + $0.25 | 2.4% + $0.30 | 1.6% + $0.30 |
| Credit Card (online invoice) | 2.9% + $0.25 | 3.5% + $0.30 | 3.3% + $0.30 |
| Credit Card (keyed) | 3.4% + $0.25 | 3.5% + $0.30 | 3.5% + $0.30 |
QuickBooks Online would benefit someone who:
- Needs to access their accounting/finances on multiple devices
- Wants access through mobile device
- Prefers an easy to learn and use software
- Prefers time saving automations
- Wants to give customers access to online invoice payments
- Prefers a monthly subscription plan
QuickBooks Desktop would benefit someone who:
- Prefers a locally installed software
- Needs access to the advanced features and the numerous users that QuickBooks Enterprise offers
- Has complex accounting
- Needs more advanced reports and inventory tools
- Prefers yearly license pricing plan
Who might choose an alternative to QuickBooks?
- Someone who is just starting out and does not want to spend extra money for accounting and finance.
- Wave is an accounting and finance software that offers free financial features for small businesses
- Someone with a lot of fixed assets such as equipment and machinery
- Xero is a simple accounting and finance software that also offers more advanced fixed asset tracking than QuickBooks.
- Someone with a service-based business that prefers cheaper plans than QuickBooks
- FreshBooks is an accounting and finance software that offers more advanced invoicing for service-based businesses.
Choose your best fit
It is important that you use a reliable and organized form of accounting for your business. Every business is different, but there are different types of software and features that will give your business the financial reporting it needs. You can feel at ease knowing that your choice, whether it be QuickBooks or an alternative, will make your financing a whole lot easier.
