Recently, a client asked to use QuickBooks Self-Employed (QBSE). I was a little skeptical (and excited). So far, I have steered clear of QBSE for a couple of reasons – I didn’t know it and it doesn’t fit most of my clients’ needs.
But with my client's request for an inexpensive income and expense tracking app, I gave QBSE a whirl.
So who is QuickBooks Self-Employed good for?
It's for those independent contractors that work out of their trucks and are a one-person gig wanting to start tracking their income and expenses.
With so many differences between QBSE and QBO, it's worth taking a look at those differences along with some of the pros and cons of QuickBooks Self-Employed.
QuickBooks Self-Employed Home Page and Navigation Bar
In many ways, the QBSE Home Page looks very familiar, almost like QBO a few renditions ago. There are widgets for Invoices, Expenses, Profit & Loss and Accounts (bank accounts and credit cards).
But there also are widgets for Mileage and Estimated Taxes. "What, features I don't even have in QBO? I can hardly believe my eyes."
QBSE Home Page
The Navigation Bar is how you get around in QBSE. Quick Create is not an option in QuickBooks Self Employed, so all activity takes place by selecting an action from the Navigation Bar.
QBSE Navigation
Let's look at some of the features of QBSE.
Invoices
When independent contractors get started, most of them rely on a pen and invoice pad to create their invoices. QBSE allows for creation, emailing and electronic payments of simple invoices.
Simple Invoices means no items – none. In my way of thinking, this results in slower Invoice creation, because there are no items. As such, descriptions must be added from scratch for each invoice.
I see this as a "con" that makes it tricky to create invoices in the field.
QBSE Invoice
No Customers is another difference. Instead of customers, you add the recipient's information to each invoice you create, because there's no stored customer list.
This is another "con" as far as I'm concerned, because it also means you cannot easily view customer activity or history. On the other hand, I can see that a lot of QBSE users may never encounter the same customer again.
No Undeposited Funds are to be found in QBSE. That's because there's no need to record deposits. Instead, when an invoice is marked paid, the income is sent directly to the bank account.
Transactions
Selecting Transaction on the navigation bar opens a screen that allows you to either attach bank feeds or record income and/or expense transactions. "Hooray, for 'bank feeds'."
QBSE Transaction Start
When entering a transaction, a description is required. Keep in mind there are no Vendors, so if you wish to keep track of vendors, you probably would want to add them into the description line.
QBSE Transaction
Chart of Accounts are provided in a drop down menu when you're creating a transaction, but they really aren't accounts; QuickBooks Self-Employed refers to them as "categories." "This obviously is going to take some getting use to by accountants and bookkeepers."
I can see both some pros and cons of that. A "pro" might be that a new user is not overwhelmed and in response creates too many or too few accounts. A "con" is that there is very little in the way of no customization and only one income account.
Mileage Tracker
This is one of those "I-can-hardly-believe-my-eyes" features that I mentioned earlier. I kind of love this feature and want it in QBO Essentials and Plus.
QBSE Mileage Tracker
The sync is easy between MileIQ and QuickBooks Self-Employed. Since a lot of QBSE users will be highly mobile, the fact that mileage tracking is built-right-in with a mobile app makes this a pro, pro, pro.
Estimated Quarterly and Annual Taxes
QBSE users can create a Tax profile that allows for automatic payment recommendations and tracking of tax payments. I know that Murph wrote an article on how QBSE users can even link their data to Intuit TurboTax Online.
It's just another reason why I think ProAdvisors, accountants and bookkeepers need to embrace QuickBooks Self-Employed, so we can help QBSE users get the right data into their tax returns.
QBSE Estimated Tax
Conclusions
If we keep in mind that QuickBooks Self-Employed is designed for the independent contractor wanting the next step in business organization, this is a great tool and inexpensive at $5 for the first six months, then just $10 a month thereafter1.
I was using the free version, but I couldn’t find the ability to upgrade. So, if you don’t like QuickBooks Self-Employed, I’m not sure you can convert it to another version.
(Editor's Note: At present it is NOT possible to migrate QBSE to any QBO version, Intuit has indicated that they have this 'somewhere' in their pipeline, but hasn't announced any date for such ability.)
A few other things to keep in mind:
- You cannot import from QuickBooks Desktop
- There are no keyboard short cuts
- Users are limited to the Master Admin and one accountant
For comparative purposes only, here are the features and prices of the various products, QuickBooks Self-Employed, QBO-Simple Start, QBO-Essentials and QBO-Plus (as of the time of publication of this article)1.
Intuit
Intuit Product Comparison
Maybe, if I didn’t love QBO Essentials/Plus so much, I wouldn’t try to compare the programs, but rather simply think of each of them like children… all being different and valued for their individual abilities.
With that said, QuickBooks Self-Employed is a great place to start tracking income and expense. And, if the company grows, so too will its need for more QBO.
1 – Editor's Note: Prices shown (or discussed within the content) in this article are Intuit published prices as of the time of this publication; neither the author, editor, publisher or Insightful Accountant, assume any control over, or liability for, any change that maybe made in the prices contained in this article, now or at any time in the future. Such prices are under the exclusive control of Intuit.