# How to Do Job Costing in QuickBooks Online

To do job costing in QuickBooks Online, turn on Projects (available in Plus, Advanced and Intuit Enterprise Suite), create a project for each job under its customer, then assign every invoice, bill, expense and timesheet to that project. Set hourly cost rates so labor is counted. The project's Overview tab then shows income, costs and profit margin per job.

## Key takeaways

- Projects is the job costing feature in QuickBooks Online Plus, Advanced and Intuit Enterprise Suite. Simple Start and Essentials don't include it.
- Job costing only works if every cost is tagged to a project when it's entered: bills, card expenses, checks, payroll time and subcontractor invoices.
- Labor is the cost most shops miss. Set an hourly cost rate per employee (wage plus employer taxes and, optionally, overhead) so project profitability includes it.
- Compare each project's actuals to the estimate while the job is open, not after it closes.
- Use projects for jobs and classes for divisions. See [QuickBooks classes vs. projects](https://www.brix.so/learn/quickbooks-classes-vs-projects).

## What does job costing in QuickBooks give you?

A profit number per job, not just per month. [Job costing](https://www.brix.so/learn/job-costing) answers the question the P&L can't: which jobs, customers and job types make money. In QuickBooks Online, the Projects feature groups every transaction for a job, including labor time, and shows income, costs and margin in one place. Intuit's help describes projects as a way to track income and costs for specific projects and run project-specific reports.

## Step by step: job costing with QuickBooks Projects

1. **Check your plan and turn on Projects.** Per Intuit's help (updated October 2026), Projects is available in QuickBooks Online Plus, Advanced and Intuit Enterprise Suite. It's on by default in Plus and Advanced; if not, go to Account & settings, select Advanced, and turn on "Organize all job-related activity in one place."
2. **Set up your chart of accounts for job costs.** You need cost of goods sold accounts for materials, subcontractors, field labor and other direct costs, separate from overhead. See [chart of accounts](https://www.brix.so/learn/chart-of-accounts) and our [QuickBooks chart of accounts for contractors](https://www.brix.so/templates/quickbooks-chart-of-accounts-for-contractors).
3. **Create a project for each job.** Go to All apps, then Projects, then Projects, and select New project. Name it ("Smith – Furnace replacement – Oct 2026"), choose the customer and save. One project per job, not per customer.
4. **Enter hourly cost rates for employees.** In Projects, select Employee hourly rate and add each employee's hourly wage plus employer taxes. Intuit's calculator lets you add workers' comp and overhead too. For salaried staff, divide annual pay (with employer taxes) by weeks and average hours. Set rates before tracking time; they apply only to time entered afterward.
5. **Assign every cost to the project.** When you enter a bill, expense, check or card charge, pick the project in the customer/project field on each line. Subcontractor bills, permits, dump fees and rentals included. Use the project's "Add to project" dropdown to create transactions from inside the project.
6. **Track time to the project.** Employees (including salaried ones) log hours to the project on timesheets. If you use QuickBooks Time, workers pick the project in the app and you approve and export the time. Hours × cost rate becomes labor cost on the project.
7. **Add the estimate and invoices to the project.** Create the estimate inside the project, then invoice from it, using [progress invoicing](https://www.brix.so/learn/progress-billing) on longer jobs. In Advanced, you can compare estimate vs. actuals on the project dashboard.
8. **Read project profitability.** The project's Overview tab shows income, costs and profit margin, with labor broken out. The Project profitability report (in the project's reports tab) does the same in report form. Compare actual margin to the margin you priced. See [gross margin](https://www.brix.so/learn/gross-margin).

## Payroll expenses or hourly costs?

QuickBooks gives two ways to count labor on projects. Payroll expenses use actual payroll data and post after you run payroll (with QuickBooks Payroll). Hourly costs use the estimated rates you entered and show up immediately when time is entered. You switch between them with a dropdown inside any project, and Intuit notes that changing the setting in one project affects all projects. Intuit also notes the Project profitability report uses payroll expense data, so if you track labor only with hourly cost rates, rely on the Overview tab or customize the report. Most small contractors without QuickBooks Payroll use hourly costs.

> **Worked example: a water heater job in Projects**
>
> Illustrative numbers. A plumbing company sells a tankless water heater install for $4,800 and creates a project.
>
> Bill from the supply house coded to the project: $1,950 (unit, venting, fittings). Permit paid by card, coded to the project: $120.
>
> Two technicians log 4.5 hours each. Hourly cost rates are $38 and $31 (wages plus employer taxes and workers' comp). Labor cost = 4.5 × $38 + 4.5 × $31 = $310.50.
>
> Project Overview: income $4,800, costs $2,380.50, **profit $2,419.50, a 50.4% margin**. The owner priced the job for 50% gross margin, so this one hit the mark. A job at 35% would show the same way, in real time, while there's still time to ask why.

## Job costing setups by trade

**How to structure projects and costs**

| Trade | One project per… | Costs most often missed |
| --- | --- | --- |
| HVAC | Replacement or install; service calls grouped by month or tracked as sub-customers | Refrigerant, truck stock parts, callbacks |
| Plumbing | Install or repipe; service by job or by month | Counter-ticket parts, permit fees |
| Electrical | Panel upgrade, fit-out, service contract phase | Wire from truck stock, lift rentals |
| Roofing | Each roof | Dumpsters, subcontracted crew labor, warranty callbacks |
| Remodeling and GC | Each contract | Owner's supervision time, change order costs |
| Landscaping | Each install; maintenance contracts by property | Fuel and equipment time, plant replacements under warranty |

## Common job costing mistakes in QuickBooks

1. **Costs entered without a project.** The most common failure. Check the uncategorized and no-project transactions every week.
2. **Labor left out.** Without hourly cost rates and project time, a labor-heavy job looks hugely profitable.
3. **One project per customer instead of per job.** Repeat customers blur together; you can't see which job lost money.
4. **Truck stock never costed.** Parts pulled from [truck stock](https://www.brix.so/learn/truck-stock) and not charged to the job make small service jobs look better than they are.
5. **Overhead ignored in pricing.** Project profit is gross profit. Overhead still has to be covered; see [overhead](https://www.brix.so/learn/overhead) and the [job pricing calculator](https://www.brix.so/tools/job-pricing-calculator).
6. **Reviewing after the job closes.** Check open projects weekly so overruns are caught mid-job.

Menu names in QuickBooks Online change often. The paths above match Intuit's help articles as of October 2026; if your screen differs, search the feature name inside QuickBooks or check Intuit's current article. For a full setup walkthrough, see [QuickBooks setup for contractors](https://www.brix.so/guides/quickbooks-setup-for-contractors).

BRIX syncs customers, invoices and payments with QuickBooks and keeps expenses categorized, so the income and cost sides of each project are filled in from the jobs you actually ran. Crew timesheets record job hours for payroll and costing.

- [QuickBooks sync](https://www.brix.so/integrations/quickbooks): Syncs customers, invoices and payments with QuickBooks so the books match the jobs.
- [Bookkeeping and tax help](https://www.brix.so/features/bookkeeping-taxes): Keeps expenses categorized, tracks 1099 subcontractors and sales tax, and reminds you of quarterly estimated tax dates. BRIX does not file taxes or give tax advice.
- [Crew timesheets](https://www.brix.so/#use-cases): Clock-ins, job hours and payroll-ready timesheets.

## Frequently asked questions

### Which QuickBooks Online plan do I need for job costing?

Intuit's help says Projects is available in QuickBooks Online Plus, Advanced and Intuit Enterprise Suite. Simple Start and Essentials can tag transactions to customers and sub-customers, but don't have the Projects dashboard, hourly cost rates or project profitability reports.

### How do I track labor costs by job in QuickBooks Online?

Enter an hourly cost rate for each employee in Projects (wage plus employer taxes, optionally overhead), then have employees log time to projects on timesheets. QuickBooks multiplies hours by the rate and shows labor cost on the project. If you use QuickBooks Payroll, you can switch to actual payroll expenses instead.

### What's the difference between a sub-customer and a project?

Both sit under a customer, but a project adds the Overview dashboard, labor costing with hourly rates, status tracking and project reports. Sub-customers are the older way to do job tracking and still work in plans without Projects.

### Can I see estimate vs. actual costs in QuickBooks Online?

In QuickBooks Online Advanced you can set up project estimates and compare estimate versus actuals on the project dashboard and in reports, per Intuit. In Plus, compare the project's actual costs to the estimate you created manually.

### Does job costing in QuickBooks include overhead?

Not automatically. Project profitability shows income minus the costs you tag to the project. You can build an overhead allowance into hourly cost rates, but most contractors treat project profit as gross profit and cover overhead through pricing.

### Can QuickBooks Desktop do job costing?

QuickBooks Desktop has long had jobs under customers and job cost reports, and its contractor edition adds more. This guide covers QuickBooks Online; the concepts are the same, but menu paths and reports differ.

## Related

- [What Is Job Costing?](https://www.brix.so/learn/job-costing)
- [QuickBooks Classes vs. Projects: What's the Difference?](https://www.brix.so/learn/quickbooks-classes-vs-projects)
- [What Is a Chart of Accounts?](https://www.brix.so/learn/chart-of-accounts)
- [What Is Cost of Goods Sold (COGS) for a Contractor?](https://www.brix.so/learn/cost-of-goods-sold)
- [What Is Gross Margin?](https://www.brix.so/learn/gross-margin)
- [What Is Labor Burden?](https://www.brix.so/learn/labor-burden)
- [Job Costing Calculator](https://www.brix.so/tools/job-costing-calculator)
- [Job Costing Spreadsheet Template](https://www.brix.so/templates/job-costing-spreadsheet)
- [How to Set Up QuickBooks for a Contracting Business](https://www.brix.so/guides/quickbooks-setup-for-contractors)
- [QuickBooks for contractors: the right version, real job costing and a sync that keeps the books matched to the jobs](https://www.brix.so/integrations/quickbooks)

## Sources

- [Intuit QuickBooks — Set up and use the Projects feature in QuickBooks Online](https://quickbooks.intuit.com/learn-support/en-us/intuit-account-billing/set-up-and-use-the-projects-feature/00/186112) (checked 2026-10-12)
- [Intuit QuickBooks — Track hourly labor costs and profitability by project in QuickBooks Online](https://quickbooks.intuit.com/learn-support/en-us/help-article/regular-payroll/track-hourly-labor-costs-profitability-project/L9ZxBA4sn_US_en_US) (checked 2026-10-12)
- [Intuit QuickBooks — Set up and send progress invoices in QuickBooks Online](https://quickbooks.intuit.com/learn-support/en-us/help-article/invoicing/set-send-progress-invoices-quickbooks-online/L0Ymm6WjR_US_en_US) (checked 2026-10-12)

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Written by BRIX Editorial Team. Last updated 2026-10-12.
Canonical: https://www.brix.so/learn/how-to-do-job-costing-in-quickbooks