Quickbooks Online vs Desktop

It is nice to keep your books online. It is also more secure to keep your books offline. For many, that is the foundation of the QuickBooks online vs desktop debate.

For a small business with limited resources, having a full version of QuickBooks that can be accessed from almost anywhere is a tremendous advantage. It makes information access easy and you gain access to a number of features that aren’t available on the desktop version.

On the other hand, QuickBooks Desktop offers businesses an easy way to manage a large amount of inventory and tracks job costing very efficiently. There are also certain data entry features that can be found with the desktop version that cannot be found with the online version.

Times are changing, however, and Intuit is clearly trying to shift users away from the desktop product to be using QuickBooks Online. New desktop versions are not receiving any industry-related features, reducing the separate identities that many businesses found to be beneficial in the past. Mac users are going to be left out in the cold completely.

Intuit has even published content on their website which says, “Learn why QuickBooks Online is Better.”

Is it time to upgrade to QuickBooks online? Is Desktop still the better version for your business needs? Here are the key points to think about.

What Are the Benefits of QuickBooks Online?

The biggest benefit of using QuickBooks Online is that it gives you access to mobile devices. You can attach numerous types of documents, images, or even signatures to a transaction. You can also upload them from your computer to attach them within QuickBooks.


There is an Audit Log that can be used to track the changes made within QuickBooks over time. You can also track by location and other location labels instead of tracking only by class.

Another great advantage of QuickBooks Online is that it will automatically download your bank transaction changes overnight. Once the download is complete, you have options to match, add, or exclude line items to make your books accurate.

Customized banking rules can be implemented with the online version as well. You can split by dollars or percentages, with the chance to assign locations or classes with the rules. Journal entries are allowed to have multiple lines for your payables or receivables. You can even setup multiple budgets within the same fiscal year.

The one real disadvantage with QuickBooks Online is that it doesn’t have the wide-ranging power of Desktop. Intuit has been producing QuickBooks Desktop for over two decades. It is designed to do almost everything that SMBs need from an accounting software tool. You can fill-in some of the gaps that exist between the online and desktop versions with third-party apps, but that means exposing some of your information to others that is not required when using QuickBooks Desktop.

What Are the Benefits of QuickBooks Desktop?

One of the biggest benefits that can be found with QuickBooks Desktop is its reporting features. You have access to industry-specific reporting. You can perform forecasting through the business planner and short your balance sheet by class. There’s also added customization to the report headers and footers compared to what Online offers.

Inventory is another strength for QuickBooks Desktop. It uses the average cost valuation method and allows businesses to set their own inventory reorder points. You can receive partial purchase orders and maintain accurate numbers. There is also an availability to promise on Desktop and features for manufacturing.

Accounting-specific benefits on Desktop are rather limited. You can back-up your files and restore them if something should happen. Condensing files is possible as well and there are several client data review tools that are available to use.

The one real disadvantage of QuickBooks Desktop is that you cannot post to additional accounts payable or accounts receivable accounts. It only works with the accounts you connected during the initial installation process.

Is QuickBooks Online Really Better?

Intuit lists 6 reasons why they think you’ll believe QuickBooks Online is a better option right now.

1. You can capture receipts on your phone and then attach them to any transaction within the QuickBooks mobile app.
2. There is less data entry required because the online version categorizes bank transactions and credit card transactions after downloading them.
3. You can work from anywhere there is a data or internet connection since you can access QuickBooks through your phone.
4. The app allows business owners to access customer information, invoice information, and other critical data points directly from a smartphone.
5. The online version allows you to connect your data directly to your accountant so that information can be discussed in real-time. There is no need to have your accountant visit your office, like QuickBooks Desktop often requires.
6. You can access QuickBooks Online on a Mac or a PC.

To further entice new customers to use QuickBooks Online instead of QuickBooks Desktop, there are added fees to the Desktop version that are not paid by those who use the online version. Here is a run-down of the added optional fees that come with Desktop, but are included with Online.

  • Desktop users must pay $89 to receive 90 days of phone support.
  • Automated data-encrypted back-ups are $9.99 per month with QuickBooks Desktop.
  • It requires a $299 annual upgrade to have the latest product and feature updates.
  • Cloud access and/or hosting can be up to $200 per month, per user.
  • Automatically downloading bank transactions is possible with Desktop, but averages around $15 per month in additional costs.
  • QuickBooks Online offers access to up to 5 users automatically, but Desktop requires 5 users licenses to be purchased to receive the same access.

Despite those stark cost differences, there are two key points that must be emphasized for QuickBooks Desktop.

1. If you need to calculate and rebill job costs, only the desktop version of QuickBooks will allow you to do so.

2. QuickBooks Desktop allows you to calculate discounts by customer.

There are added fees that come with QuickBooks Online as well. If you need to track inventory or prepare and print 1099s, then you must subscribe to the Plus tier that is offered. The base price for the Plus plan is $50 per month, which is $15 per month more than the Essentials plan.

That means a business will pay up to $600 per year to have a subscription to QuickBooks Online Plus. On the other hand, QuickBooks Desktop Premier retails for $349.95.

At the end of 3 years, the total cost of QuickBooks Online for 1 person would be $1,800. If the upgrades are purchased each following year for Desktop Premier, the cost would be less than $1,000.

Is the increased price a reason for the push toward QuickBooks Online? Possibly, but the Desktop advantages go away if a business needs to give 5 people access to the platform. Compare these key points and you’ll discover which option will work the best for you this year.

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