How to Do Time Tracking in QuickBooks Online
Time tracking in Quickbooks Online Essentials is a resource for businesses that allows different members of the team who work on different projects, and in different locations, to track their hours worked. With time tracking, managers can track their team members' location, how much time they have spent on each project, and manage budgets using the Clock In and Clock Out tabs.
Time tracking is also a great solution for freelance workers and contractors who need to track their activities for billing, deductions, and tax purposes. For example, a worker who is based in Jacksonville, Florida, but is working on a job in Orlando can benefit from time tracking when calculating the standard mile deduction or managing their billable and non-billable hours.
So, how do you do time tracking in QuickBooks Online?
Step 1: Set Up Your Company's Details
There are several steps you need to take to set up your company's details in QuickBooks Online for time tracking. If you’d like support with getting everything set up correctly, professional QuickBooks training can get your team off to a great start.
Software Integration
Time tracking works well when integrated with QuickBooks Payroll or the payroll function in another accounting software. If you plan to use two systems in tandem, it's important to integrate them before you do anything else.
If you are already using QuickBooks Online for payroll or other functions, set up your Time account through your existing QuickBooks account.
If you use other payroll software, you can still integrate them using the setup guides provided by QuickBooks or your other software provider.
Company Default Settings
Go to Company Settings to set up your company-wide and default settings. Further settings can be adjusted according to the team member.
There are various settings to complete, but these are the most vital:
Pay Schedule
Set your pay schedule to:
Run reports by pay period
Calculate pay period trials
Export timesheets to your payroll software
Make sure your schedule matches your payroll dates. You also have the option to set up time off accruals by pay period.
Overtime
Set up your company settings for overtime tracking. This may be in line with the basic overtime settings that you can find in Company Settings. However, if you need custom or advanced options, use the Pay Rate Engine.
Time Options
In the Time tab, set up:
The company's date and time default
How you'd prefer your team members to enter their timesheets
Time Off
Set up time off codes, then configure balances and accruals. Using this function, your team can:
Accrue hours
See their balances
Submit time off requests
Select Save after each data input.
Step 2: Set Up Your Time-Tracking Preferences
It’s time to set up how you want your team to track hours. This will help you run reports, approve time for payroll, and know how to invoice clients according to their billing rate.
You’ll need to decide:
Where your team members should enter their timesheets
Which customers or jobs each timesheet corresponds to
Time Tracking Options
Team members can track time on a desktop, laptop, or mobile device. Mobile time tracking using Quickbooks timesheets provides options like location tracking and geofencing.
Both the web version and the mobile app offer manual time entry. This allows your team members to enter their hours after they finish their shifts.
Jobs, Customers, and Projects
Knowing how much time your team spends with certain clients enables you to bill customers correctly. You may also want to know how much time your team spends on certain jobs. To do this, set up Jobs and Customers or Projects with Estimates to track time effectively.
In the unlikely case that the check is sent to the wrong person, or is made out for the wrong amount, you can also void the check using QuickBooks.
Step 3: Add and Invite Your Team Members
You are now ready to invite your team members to use the time tracker function.
Team members: If your integration doesn’t import team members automatically, add your team members to QuickBooks Time. You will need to customize permissions depending on whether team members have permission to edit their own timesheets or not.
Groups and managers: You may need a team manager to supervise certain team members; if this is the case, set up Groups and Managers. This manager can then track, edit, and approve their team members' time.
Add a time tracking user: If team members are authorized to track their own weekly timesheets, you can invite each team member to become a user of your account.
Go to Settings and select Manage Users.
Select Add User.
Select Time Tracking Only.
Select Next.
Find the employee or client you want to add, select Next, then enter his or her contact information.
Select Save.
Step 4: Manage Time and Run Reports
Everything is now ready for you to manage your Time account. Use the following features to see how your team's time is spent.
Schedule, Edit, and Manage time
Use the Schedule feature to keep your team up to date with their shifts and remind them to clock in.
Time Entries is a time-tracking feature that allows timesheets to be added, edited, or deleted. This can be done from your desk or the mobile app if you're on the road.
Approvals and Other Reports
There are several kinds of reports available on QuickBooks Time. Before running payroll and invoicing, use the Approvals Report to check that the figures are correct; this allows you to check and approve an employee's weekly timesheet and prevents you from having to make changes later on.
Time Tracking in Quickbooks Online: An Effective Software Solution
Time tracking with QuickBooks Online offers businesses, freelancers, and contractors a complete solution that can save the business money and facilitate complicated billing processes. It’s an especially useful feature for accounting for freelancers and accounting for general contractors, when billing is calculated by the hours worked. Thanks to its industry-leading features, QuickBooks Time was featured in Forbes as one of the top time-tracking apps for 2023.
Though some business owners may feel comfortable setting up QuickBooks time tracking alone, others may feel more comfortable starting with QuickBooks training. QuickBooks training with a QuickBooks Elite ProAdvisor will leave you feeling safe in the knowledge that your business bookkeeping is running smoothly, leaving you free to concentrate on the aspects of your business that you love the most.
