Moving from QuickBooks Desktop to Online: A Step by Step Guide
Using QuickBooks Desktop for accounting operations? It is time to switch. QuickBooks is now going for a cloud-first approach, and it’s high-time that you do too! Switching from QuickBooks Desktop to Online can potentially be a game changer for your subscription business. You get to have superior flexibility, accessibility, and smarter features. Not to mention the automatic updates!
How to make your migration seamless? This article will be your guide. We’ll walk you through the key differences between QuickBooks Desktop and Online, the reasons why you should switch, and the ways you can ace your transition.
Key Differences Between QuickBooks Desktop and Online
QuickBooks is a reliable accounting platform for small and medium sized businesses. It offers a range of efficient solutions such as auto-invoicing, payroll management, expense tracking, inventory management, and a lot more. Users can choose between QuickBooks online and Desktop according to their needs. However, the platform itself encourages users to shift to its online version, since it offers more advancement and scalability.
The company is discontinuing the older versions of QuickBooks Desktop, and gradually limiting access to certain in-app purchase features with each update. This gives businesses one solid reason for switching from QuickBooks Desktop to Online.
Let us compare the features of QuickBooks Desktop and Online to understand their differences better:
QuickBooks Desktop
Installation: It is locally installed on your device.
Access: It can only be accessed through the device it is installed on.
Pricing: There are three types of QuickBooks Desktop: Pro, Premier and Enterprise, and each comes with its own set of tools. These platforms are primarily sold as one-time purchases. The current prices of QuickBooks Pro, Premier and Enterprise for single user start from $650, $950, and $1,922 respectively. They are also available as yearly subscriptions. Desktop versions purchased on yearly subscriptions come with updates and customer support as well.
Data Control: Since all the data is stored locally on the users’ devices, they have full access to it.
Collaboration: QuickBooks Desktop limits team collaboration, since it only gets installed on the devices of selected users. This prevents them from sharing their data in real-time via cloud. This also means that users have uneven access to data, making it challenging for them to stay on the same page.
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QuickBooks Online
Installation: It is cloud-based, not installed.
Access: Users can access its services from any device connected to the internet.
Pricing: These are the plans QuickBooks Online offers: Simple Start, Essentials, Plus and Advanced. They are available as monthly subscriptions. The current subscription costs of these plans per-user are $35, $65, $99, and $235 respectively.
Data Control: Since your data is stored on cloud, Intuit (the company behind QuickBooks) manages its storage, backup and security. Users can view and edit data, and export it in various formats. The exported data can be saved locally, or used with another software.
Collaboration: Users can access data and collaborate in real-time. They can share everything on cloud, so data does not get restricted to a single user’s device.
QuickBooks Desktop vs Online: Feature by Feature Comparison
- Accessibility
Desktop: It is installed locally on a single device, and can only be accessed from that device. For better access, companies have to employ external cloud hosting services. They have to pay extra for those services. All the updates have to be installed manually as well.
Online: It is accessed via cloud. Multiple users can access data at the same time depending on the subscription plan. It can operate on any device connected to the internet, and allows for real-time collaboration. Companies can also create and assign different roles and permissions to users. The software is updated and backed up automatically.
- Cost
Desktop: The license for all its versions is available primarily for one-time purchase. Businesses have to pay extra for services such as cloud hosting, multi-user access, and payroll management.
Online: Users buy subscriptions of QuickBooks Online. There are different subscription tiers available: Simple Start, Essentials, Plus, and Advanced, according to the number of users. Businesses do not have to pay extra charges for cloud storage.
- Functions
Desktop: It offers users more advanced customizations, and even industry specific editions, such as manufacturing, and retail.
Online: It enables users to collaborate in real-time. This version is more flexible and can be integrated with external software and payment gateways seamlessly. Subscription businesses can leverage its easy recurring billing automation, and tax tracking.
- Invoicing & Payment Processing
Desktop: Businesses can customize invoices, and also activate batch invoice processing. In order to process payments, they have to integrate the platform with QuickBooks Payments. There are additional charges for this. Overall, the platform offers limited automation when it comes to billing, and processes often require manual intervention.
Online: Recurring billing, invoicing and payment reminders all run on automation. Businesses can generate payment links to process payments via credit/debit cards or ACH. The platform also integrates with popular payment gateways for easy payments.
- Payroll & Tax Compliance
Desktop: The payroll feature has to be purchased as an add-on. It offers limited automation. Taxes also have to be calculated and filed manually.
Online: Payroll management, and tax calculation and filing are all fully automated.
- Integrations & Add-Ons
Desktop: It offers integration with a limited number of software. Businesses have to pay extra for add-on features.
Online: The platform flexibly integrates with more than 650 apps. These include payroll management, CRM, and e-commerce platforms among others.
- Customer Support
Desktop: Support is limited to only those users with access licenses. Support team can be contacted via phone and chat. Each update is manually installed by the employees.
Online: Support is available 24/7. Channels are phone, chat as well as email. Software gets updated automatically.
8 Steps for Moving from QuickBooks Desktop to Online for Subscription Businesses
If you want to migrate to QuickBooks Online, while continuing your subscription operations uninterruptedly, follow this guide step by step:
Step 1: See if QuickBooks Online Meets Your Needs
- The first step before system migration is always thorough planning.
Planning involves checking out the features of the new software, and determining whether it’s right for you. We have already mentioned the basic differences between QuickBooks Desktop and Online for your convenience. However, it is a good practice to contact the merchant itself to ask if they have all the functions you want.
Step 2: Reconcile Financial Records
- Ensure that all your pending accounts are reconciled. It includes invoices, refunds and recurring payments.
- Make sure that you have accurate records for your earned and deferred revenue, as well as prepaid accounts.
- Do checkout your customers’ payment history, so that you don’t miss or duplicate any transaction in QuickBooks Online.
Step 3: Backup Data
- Make sure you back up all your subscription invoices, customer lists, financial reports, and customer contracts.
- Securely store all data regarding usage-based billing, subscription renewals and contract periods before you switch.
Step 4: Transfer Data to QuickBooks Online
- Transfer data using QuickBooks Desktop Export Tool. This is QuickBooks Desktop’s in-built feature.
- After that, you will be allowed to sign in to your QuickBooks Online account by following the directions on screen.
- See to it that you map all your subscription data, customers’ payment methods and recurring invoices data without errors.
- Check your tax settings for sales tax on recurring payments, VAT and GST (if you apply those).
Step 5: Set Up Subscription Billing & Payment Processing
- Activate recurring invoicing and payments on QuickBooks Online.
- At this stage, you can integrate with your preferred subscription management software, such as SubscriptionFlow.
- Make sure that your payment gateways are connected properly for accepting recurring payments.
Step 6: Review Subscription Revenue Data
- Do a comparison of your revenue figures in both QuickBooks Desktop and Online to identify any discrepancies.
- Ensure that the new system has updated data regarding any mid-cycle subscription adjustments, cancellations, upgrades or downgrades.
- Check whether your billing and auto-renewal settings are set up correctly.
Step 7: Train Your Team
- Conduct team training sessions for smooth onboarding onto the new platform.
- Get regular insights into your business performance to monitor improvement. You can utilize QuickBooks Online’s dashboard to track your key metrics.
Step 8: Run Tests Before Complete Reliance
- Monitor the new system thoroughly by creating test invoices, and processing sample payments.
- Confirm that the system is sending your customers the correct invoices, and payment reminders.
There you go. Now you’re all set up to use QuickBooks online. This way, you won’t lose your precious data, or run into operational errors.
Why Should Subscription Businesses Switch to QuickBooks Online?
You might already have picked up some benefits of using QuickBooks Online over Desktop. Let us list the major benefits one by one to help you decide whether migration to QuickBooks online is worth it or not.
- Cloud Accessibility
QuickBooks Online stores your data on cloud. This means that you can access it whenever you want, and wherever you want. You can easily track customer payments in real-time. The platform is best suited to those businesses who operate in multiple locations. They can say goodbye to scattered, all-over the place data, by storing all their information on one platform.
- Automated Recurring Invoicing
QuickBooks Desktop is unsuitable for subscription businesses due to its lack of automation. Users have to generate invoices manually in there. This is troublesome for a significant number of subscriptions, and is prone to human errors. In contrast, QuickBooks Online automates key payment processes, for faster and efficient workflows. It also integrates with various payment gateways to fetch customer payments on its own.
- Seamless Integrations
If you use two or more software for managing your operations, QuickBooks Online can easily be integrated with those. It ensures smooth flow of data between all the platforms, and maintains data integrity.
- Automated Bank Reconciliation
You can match all the transactions with bank accounts automatically for effortless revenue reconciliation. You can also track subscription changes like upgrades and downgrades, refunds and chargebacks.
- Scalability
You can choose from any of the four subscription plans for your QuickBooks Online account. Your choice will depend on the number of users you want licenses for. As your business grows in size, you can easily switch to the more advanced plan. The platform is highly scalable, and suitable to cater to a high subscription volume.
- Compliance with Tax Regulations
QuickBooks Online supports automatic tax calculations so that you always remain tax compliant. It automatically applies specific tax charges such as VAT and GST on the relevant invoices. Additionally, it supports PEPPOL invoicing for subscription businesses working in the European region for seamless compliance.
- Cost Efficiency
Instead of paying a heavy one-time fee for QuickBooks Desktop, businesses can easily purchase QuickBooks online on a subscription basis. Subscription prices are cost-effective, especially for small businesses with limited budgets. Since everything is managed online, you no longer have to invest in expensive hardware.
How SubscriptionFlow Makes Your Migration Worth It
SubscriptionFlow is a subscription management expert, and helps businesses with robust billing and customer accounts handling. We integrate seamlessly with QuickBooks Online, so that you fulfill both your accounting and subscription handling needs from one place. Here’s a quick glance at what our integration offers you:
- Meticulous payments and expense tracking
- In-depth reports generation
- Integration with multiple payment gateways, and third-party applications
- Customizable subscription plans and dynamic pricing
- Precise configuration of discounts
- Efficient payment recovery
- Accurate data synchronization
Book a demo today, and gain all these features and more. At SubscriptionFlow, we make your migration from QuickBooks Desktop to Online stress-free. Our team of experts guides you every step of the way.
