QuickBooks Online Essentials Features and Benefits for Small Businesses
QuickBooks Online Essentials is designed for small businesses that need more than basic income and expense tracking. The current plan includes bill management, detailed reporting, income and expense tracking, receipt capture, mileage tracking, sales tax tools, 1099 contractor management, time tracking, and access for up to three users.
For a growing small business, choosing accounting software is about more than recording transactions. You may need to manage bills, track customer payments, review financial reports, organize receipts, collaborate with a bookkeeper, and monitor employee time.
That's where QuickBooks Online Essentials can be useful. It expands on the basic QuickBooks Online experience with features designed for businesses with somewhat more complex accounting needs.
If you're considering whether Essentials is appropriate for your business, here's a closer look at its major features and benefits.
What Is QuickBooks Online Essentials?
QuickBooks Online Essentials is a cloud-based accounting plan designed for businesses that need additional accounting capabilities beyond a basic plan.
According to Intuit's current information, Essentials supports up to three billable users, plus accountant access, and includes tools for managing bills, tracking income and expenses, running detailed reports, and tracking time.
This makes it particularly relevant for small businesses where the owner, bookkeeper, accountant, or employees need to work with the same accounting data.
QuickBooks Online Essentials Features
Here are some of the most useful features available with Essentials.
1. Track Income and Expenses
One of the fundamental accounting tasks is keeping track of money coming into and going out of your business.
QuickBooks can connect with financial accounts and organize transactions into appropriate categories, helping businesses maintain more organized books.
This can make it easier to understand:
Business income
Operating expenses
Customer payments
Business purchases
Tax-related expenses
Overall cash activity
Instead of maintaining separate spreadsheets, businesses can keep much of their financial information within one accounting system.
2. Manage Bills and Payments
Bill management is one of the key areas where Essentials goes beyond basic accounting functionality.
The current Essentials plan allows businesses to track bill status, record payments, create recurring payments, and pay multiple vendors and bills.
This can be particularly helpful for businesses that receive invoices from multiple suppliers.
For example, rather than keeping a separate spreadsheet of outstanding vendor bills, you can use QuickBooks to keep track of what is due and what has already been paid.
3. Detailed Financial Reports
Financial reports help business owners understand how their company is performing.
Essentials provides enhanced reporting capabilities, including reports related to sales, accounts receivable, and accounts payable.
Depending on your business requirements, you may use reports to review:
Profit and loss
Accounts receivable
Accounts payable
Sales by customer
Expenses
Cash flow
Business performance
Better reporting can help you make decisions based on actual financial information rather than assumptions.
4. Receipt Capture and Organization
Keeping receipts organized can become difficult when a business has many transactions.
QuickBooks allows users to capture receipt images using a smartphone and match them with expenses.
This can reduce the need to keep piles of paper receipts and make it easier to locate documentation later.
5. Track Business Mileage
For businesses where employees or owners regularly drive for business purposes, mileage tracking can be useful.
QuickBooks provides smartphone-based mileage tracking that can help distinguish business trips from other driving activity.
This can be especially relevant for:
Contractors
Consultants
Sales professionals
Service businesses
Mobile businesses
6. Track Sales and Sales Tax
Businesses can also use QuickBooks to track sales and sales tax.
The software can help organize sales-tax information associated with transactions and provide a clearer picture of amounts collected.
Businesses should still verify applicable tax requirements with a qualified tax professional because tax obligations vary by location and business circumstances.
7. Manage 1099 Contractors
Businesses that work with independent contractors may need to keep track of payments and prepare 1099-related information.
Intuit currently lists 1099 contractor management among the Essentials features, including the ability to prepare and file 1099s through QuickBooks.
This can help businesses keep contractor information more organized throughout the year.
8. Track Employee Time
Time tracking is another important feature for service-based businesses.
Essentials supports time tracking, allowing users to enter hours and give employees access to record their own time. It also integrates with QuickBooks Time.
This can be valuable when employees or contractors bill customers based on hours worked.
For example, a consulting company could track hours spent on a customer project and use that information when preparing invoices.
9. Multiple User Access
A major advantage for growing businesses is the ability to have multiple users.
Current QuickBooks information lists three billable users for Essentials, with additional accountant access.
This means a business owner doesn't necessarily have to handle every accounting task alone.
A typical setup might include:
Business owner
Bookkeeper
Accountant
Each person's access can be managed according to the needs of the business.
Benefits of QuickBooks Online Essentials for Small Businesses
The features above can provide several practical benefits.
Better Organization
Instead of keeping financial information across multiple spreadsheets and documents, businesses can centralize many accounting tasks in one system.
Easier Bill Tracking
Tracking outstanding bills can help businesses stay aware of upcoming payments and reduce the risk of overlooking vendor obligations.
Improved Financial Visibility
Detailed reports can provide a clearer view of revenue, expenses, receivables, payables, and profitability.
Easier Collaboration
Multiple-user access allows appropriate members of the business and accounting team to work with the same financial data.
Reduced Manual Data Entry
Connected financial accounts and receipt-capture tools can reduce some repetitive bookkeeping tasks.
Better Time Tracking
Businesses that bill customers based on hours can record time within the QuickBooks environment instead of relying entirely on separate spreadsheets.
Who Should Use QuickBooks Online Essentials?
Essentials may be a good fit for businesses that have moved beyond very basic bookkeeping requirements.
It can be particularly relevant for:
Service Businesses
Consultants, agencies, contractors, and other service businesses may benefit from time tracking, invoicing, expense management, and detailed reporting.
Growing Small Businesses
A business that has started adding employees or accounting personnel may benefit from multiple-user access.
Businesses Managing Vendor Bills
Companies that regularly receive bills from suppliers can use the bill-management functionality to track obligations.
Businesses Working With Contractors
Companies that regularly pay 1099 contractors can benefit from contractor-management capabilities.
Who May Not Need Essentials?
Essentials isn't necessarily the best choice for every business.
A solo business owner with very straightforward accounting requirements may find a simpler QuickBooks plan sufficient.
On the other hand, a business that requires inventory tracking or project profitability may need to look at QuickBooks Online Plus. Intuit currently lists inventory and project profitability as additional Plus capabilities.
The best plan depends on the features your business actually needs.
QuickBooks Online Essentials vs Simple Start
One common question is how Essentials compares with Simple Start.
Simple Start is intended for businesses with basic accounting needs, while Essentials adds capabilities such as bill management, time tracking, enhanced reporting, and additional user access.
Essentials may be more appropriate if you need:
Multiple users
Bill management
Accounts payable tracking
Enhanced reporting
Time tracking
More complex bookkeeping
If you only need basic income and expense tracking and you're the primary user, a simpler plan may be enough.
QuickBooks Online Essentials vs Plus
Plus includes the features available in Essentials and adds capabilities such as inventory tracking and project profitability. It also increases the user limit to five.
Therefore:
Essentials: Good for businesses needing enhanced accounting, bills, reports, and time tracking.
Plus: Better suited to businesses that also need inventory, project profitability, purchase orders, or additional users.
How QuickBooks Online Essentials Can Help a Growing Business
Consider a small marketing agency with an owner, bookkeeper, and several contractors.
The business may need to:
Record customer payments.
Track operating expenses.
Pay vendor bills.
Track contractor payments.
Record employee or contractor time.
Create customer invoices.
Review accounts receivable.
Monitor accounts payable.
Generate financial reports.
Having these activities connected within one accounting system can make financial administration easier to manage.
Tips for Getting More From QuickBooks Online Essentials
Keep Your Accounts Organized
Use appropriate categories and maintain a consistent bookkeeping process.
Reconcile Regularly
Regular reconciliation can help identify discrepancies between your accounting records and financial accounts.
Review Reports Frequently
Don't wait until tax time to look at your financial information. Regularly reviewing reports can help identify trends and potential problems earlier.
Track Bills Promptly
Enter vendor bills consistently so you have a clearer picture of upcoming obligations.
Manage User Access
Only provide users with the access they need for their responsibilities.
Keep Receipts Organized
Capture and categorize receipts promptly rather than waiting until the end of the month or year.
Frequently Asked Questions
What are the main QuickBooks Online Essentials features?
Key features currently include income and expense tracking, bill management, detailed reporting, receipt capture, mileage tracking, sales-tax tracking, 1099 contractor management, time tracking, and multiple-user access.
How many users can use QuickBooks Online Essentials?
The current Essentials plan supports up to three billable users, plus accountant access.
Is QuickBooks Online Essentials good for small businesses?
Yes. It is particularly useful for small businesses that need more than basic bookkeeping, such as bill management, detailed reports, time tracking, and multiple-user access.
Does QuickBooks Online Essentials include time tracking?
Yes. Essentials includes time tracking, and Intuit's current documentation confirms that time tracking can be configured in Essentials, Plus, and Advanced.
Does QuickBooks Online Essentials manage bills?
Yes. Essentials includes tools for tracking bill status, recording payments, creating recurring payments, and managing vendor bills.
Does QuickBooks Online Essentials track inventory?
Standard inventory tracking is a Plus-level capability rather than a standard Essentials feature. Intuit currently lists inventory tracking as an additional Plus feature.
Can QuickBooks Online Essentials help with 1099 contractors?
Yes. Intuit currently lists 1099 contractor management among the Essentials features.
Final Thoughts
QuickBooks Online Essentials Features make the plan a practical option for small businesses that need more than basic bookkeeping.
With tools for bill management, financial reporting, income and expense tracking, receipt organization, mileage, sales tax, 1099 contractors, time tracking, and multiple users, Essentials can support a growing business's everyday accounting workflow.
However, businesses should compare their actual requirements before choosing a plan. If you need inventory tracking or project profitability, for example, QuickBooks Online Plus may be a better fit.
If you're evaluating QuickBooks Online Essentials and need help understanding its features or setting up your accounting workflow, you can call +1-866-408-0444 for assistance.
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