Turn On and Set Up Time Tracking in QuickBooks Online

QuickBooks Online (QBO) is a powerful tool for managing your business’s finances, and one of its most useful features is time tracking. Whether you’re a freelancer, small business owner, or part of a team, keeping track of time worked on client projects can significantly improve billing accuracy, payroll management, and project planning. In this guide, we’ll walk you through how to turn on and set up time tracking in QuickBooks Online.

Why Use Time Tracking in QuickBooks Online?

Before diving into the setup process, it’s worth noting the benefits of using QuickBooks Online’s time tracking feature:

1. Accurate Billing: Track hours worked on client projects and ensure accurate invoices.
2. Simplified Payroll: Automatically calculate employee wages based on the time they’ve logged.
3. Project Management: Keep track of how much time is being spent on each project for better planning.
4. Integration with Other Features: Seamlessly integrates with QuickBooks Online’s invoicing and payroll features.

Now, let’s dive into the setup process.

Steps to Turn On and Set Up Time Tracking in QuickBooks Online

Step 1: Turn on Time Tracking in QuickBooks Online

To start using time tracking, you need to enable the feature within your QuickBooks Online account. Here’s how you can do it:

1. Sign In to QuickBooks Online:
   • Open your browser, go to the QuickBooks Online website, and log in with your credentials.
2. Go to Settings:
   • Once logged in, click on the gear icon (⚙️) located at the top right of the screen.
3. Select Account and Settings:
   • In the dropdown menu, click on Account and Settings under the “Your Company” section.
4. Navigate to the Time Tracking Tab:
   • In the left-hand menu of the Account and Settings page, select the Time Tracking tab.
5. Enable Time Tracking:
   • In the Time Tracking section, toggle the switch to ON.
   • You’ll be given a few options to customize how time tracking works for your business, such as:
     • Track Time on Timesheets: Enable this to manually track hours worked by employees or contractors.
     • Add Service/Task to Time Entries: You can opt to allow users to select specific tasks or services they are working on when they log time.
     • Use Weekly Timesheet: This option helps employees track their time in a weekly format.
6. Save Your Changes:
   • After selecting your preferred settings, click Save to activate time tracking for your account.

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Step 2: Set Up Time Tracking Preferences

Once time tracking is enabled, you can fine-tune how you’d like the feature to work. Here’s how you can customize the time tracking setup:

1. Select Who Can Track Time:
   • In the Time Tracking tab, you’ll also find options to decide whether only administrators or all users can track time. You can adjust these settings based on your business needs.
2. Set Up Time Tracking Preferences:
   • You’ll have the option to choose whether time tracked is billable. This is useful if you want to ensure that clients are billed for the time you or your team members spend on projects.
3. Enable the Time Tracking Widget:
   • If you’re using QuickBooks Online on a desktop or mobile device, you can enable the time tracking widget that allows you to quickly start and stop the timer while working on tasks or projects.

Step 3: Create Time Entries

Once time tracking is set up, employees or users can begin logging their hours. Here’s how they can do it:

1. Go to the Time Tracking Section:
   • Navigate to the + New button on the left side of your dashboard and click on Single Time Activity or Weekly Timesheet, depending on which time-tracking method you prefer.
2. Fill in the Time Entry Details:
   • In the time entry form, provide details such as:
     • Employee Name (or contractor).
     • Date/Time Worked: Specify the time worked, whether it’s by the hour or a fixed time period.
     • Billable: Mark if the time is billable to a customer or not.
     • Service/Task: Optionally, link a service or task to the time entry.
3. Save and Submit:
   • After filling in the necessary details, click Save and Close (or Save and New if you need to add more entries).

Step 4: View and Edit Time Entries

To view, manage, and edit time entries:

1. Go to the Time Tracking Section:
   • You can view all logged hours by going to Reports > Time Activities by Employee Detail or Time Activities by Customer for specific client-related reports.
2. Edit or Delete Time Entries:
   • If you need to edit a time entry, simply go to the Time Entries list and click on the specific entry you’d like to modify.
   • To delete an entry, click the Delete button on the entry page.

Step 5: Create Invoices Based on Time Tracked

Once time tracking is active, you can create invoices based on the logged time, making it easy to charge clients accurately:

1. Generate Invoice:
   • After completing your time tracking and ensuring everything is accurate, go to + New and select Invoice.
   • Under the “Add Time” section, you’ll see a list of billable hours. Choose the time entries you’d like to include in the invoice and QuickBooks will automatically add the corresponding charges.
2. Review and Send:
   • Review the invoice details, including hourly rates and time entries, and send it to the client directly from QuickBooks Online.

Step 6: Generate Reports for Time Tracked

QuickBooks Online also offers detailed reporting features, allowing you to generate insights into the time logged by employees or contractors. You can access reports under Reports > Time Activities by Employee Detail or Time Activities by Customer.

These reports help you evaluate time spent on specific projects or by individual workers, making it easier to analyze productivity and project profitability.

Conclusion

Time tracking in QuickBooks Online is a simple yet powerful feature that can streamline your business operations. By following the steps above, you can easily turn on and set up time tracking, ensuring accurate billing, payroll management, and project tracking. With QuickBooks, you not only simplify your time tracking process but also make sure that your business runs smoothly, with all hours worked captured and correctly invoiced.

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