How to Use Bill Pay in QuickBooks Online

Managing bills and payments is a key part of running any business. QuickBooks Online offers a bill pay feature that streamlines the process of paying vendors and contractors. This article will walk through how bill pay works in QuickBooks Online its benefits and how to set it up.

What is Bill Pay in QuickBooks Online?

Bill pay in QuickBooks Online allows you to easily pay bills to vendors and contractors electronically or by check. It lets you automate recurring payments, track due dates, and simplify approvals

With bill pay, you can:

• Import bills from vendors to pre-fill payment details
• Schedule one-time or recurring payments to vendors
• Pay bills by direct bank transfer (ACH) or paper check
• Set rules for bill approvals if multiple people access your books
• File 1099 tax forms for contractors at year-end

Bill pay eliminates the need to manually write and mail checks. It also organizes payments in one place for reporting.

Benefits of Using Bill Pay

Utilizing bill pay in QuickBooks Online offers several advantages:

Saves Time – Bill pay reduces administrative tasks. You don’t have to manually enter payment data or write checks. Recurring bills can be scheduled and paid automatically.

Prevents Late Fees – Automating payments ensures vendor bills are paid on time, avoiding late fees. QuickBooks reminds you of due dates.

Tracks Payments – With bill pay, all vendor payments are logged in your QuickBooks account. This simplifies reporting and makes tax time easier.

Organizes Bills – Keeping bills digital and in one place makes them easy to manage. You can check payment status at a glance.

Enables Oversight – Bill pay allows you to assign staff roles to control who can enter, approve, and pay bills. This safeguards your finances.

Sends 1099s – QuickBooks can automatically generate 1099 tax forms for contractors paid through bill pay. Unlimited 1099 e-filing is included.

For small businesses, bill pay is an invaluable tool to systemize vendor payments, boost efficiency, and ensure bills get paid on time.

How Bill Pay Works in QuickBooks Online

Using bill pay with QuickBooks Online is intuitive and straightforward:

1. Enable Bill Pay – Select a Bill Pay plan when signing up for QuickBooks Online or add it to your existing account. Plans start at $0/month.

2. Import Bills – When vendors email invoices, import them to instantly create a bill in QuickBooks.

3. Review & Schedule – Review upcoming bills and set payment dates. QuickBooks reminds you of due dates.

4. Pay Bills – On the scheduled date, QuickBooks deducts the payment from your linked bank account and sends it to the vendor.

You can pay bills individually or select multiple bills to pay at once. QuickBooks records the transactions and you’re done!

How to Set Up Bill Pay

Follow these steps to start using bill pay in QuickBooks Online:

1. Sign Up for QuickBooks Online – Choose a QuickBooks Online plan that meets your needs. You’ll need a paid subscription (not Simple Start) to add bill pay.

2. Select Bill Pay Plan – Pick either the Basic, Premium, or Elite plan. Pricing ranges from free to $90/month. Higher tiers offer more features.

3. Connect Bank Account – Link the checking account you want to use for bill payments. Confirm you’re authorized to transact.

4. Set Up Payees – Add vendor contact details and payment preferences in the payees list. This info will auto-populate on bills.

Once your bank account is linked, you’re ready to start importing, approving, and paying bills seamlessly through QuickBooks Online. Consider automating recurring payments for even greater efficiency.

Bill Pay Pricing in QuickBooks Online

There are three QuickBooks Bill Pay plans tailored to business needs:

• Basic – Free with 5 monthly ACH payments included. Good for few bills.

• Premium – $15/month with 40 ACH payments. Best for moderate bill volume.

• Elite – $90/month with unlimited ACH payments. Ideal for high payment frequency.

Only Basic offers a free tier. Beyond the allotted ACH payments, transaction fees apply. There are never fees for check payments.

Having bill pay integrated directly with QuickBooks Online saves you time, prevents late fees, and keeps your finances organized in one place. Select the Bill Pay plan that best fits your vendors payment volume and cash flow management needs.

Bill Pay Alternatives

If QuickBooks Bill Pay isn’t the right solution, here are some alternatives to consider:

• Bank Bill Pay – Many banks now offer free bill pay services, but they aren’t integrated with your accounting software.

• PayPal Invoicing – Allows you to invoice clients and accept payments online, but no bill management features.

• Bill.com – Robust bill payment automation for larger businesses, but more expensive.

• Wave – Free accounting software with basic bill payment. Wave offers much less functionality than QuickBooks.

For most small business owners, QuickBooks Bill Pay provides the ideal blend of convenience, efficiency, and seamless integration with your books.

QuickBooks Bill Pay Tips and Tricks

• Autopay recurring bills so they process automatically each month or week.

• Use Faster ACH for next day delivery (additional fees apply).

• Schedule future-dated payments so they process on the ideal day.

• Set permissions to control who can create/pay bills and safeguard finances.

• Run bill payment reports to reconcile accounts and track cash flow.

• Enable email bill reminders to receive due date notifications.

Is QuickBooks Bill Pay Right for You?

If your business frequently pays vendors and contractors, QuickBooks Bill Pay can optimize your processes. Key benefits include:

• Automating recurring payments
• Avoiding late fees
• Streamlining approvals
• Tracking payment status
• Integrating seamlessly with your books
• Generating 1099 tax forms

By digitizing your bills and payments in QuickBooks Online, you can manage cash flow efficiently. For most small business owners, Bill Pay is an invaluable tool that saves significant time and headaches.

Try integrating bill management with QuickBooks accounting to make paying vendors simple and painless. The right Bill Pay plan can meet the needs and budget of almost any company. Sign up today to start optimizing bill pay and free up hours each week to focus on your business, not busywork.