Track payroll expenses by classes and projects in QuickBooks Online Payroll

Learn how to categorize your payroll expenses into different classes and projects when you run payroll.

In QuickBooks Online Payroll Premium or Elite, you can allocate your payroll expenses by classes (your business’s departments, product lines, locations, etc) and by projects (jobs, customers, etc) as you create your employees’ paycheques. 

These breakdowns will show on your Profit and Loss reports. You can use them to get deeper insights into specific parts of your business.

Note: Paycheques dated July 9 - August 27, 2024 might be missing classes. Find out how to fix this.

Step 1: Assign classes and projects on your employees’ paycheques

1. Turn on and set up class tracking and project tracking (if needed). 

Note: When you turn on or update class tracking, it won't retroactively affect past transactions. It only applies to future ones.

2. Go to Payroll and select Employees (Take me there).
3. Select Run payroll. 
4. Create your paycheques as normal. 
5. Select Edit classes & projects. If you only see Edit projects, go back to Step 1 to set up class tracking. 
6. Select the class and project for each employee and each pay type used.
   • For salaried employees, enter the percentage spent on each class or project. 
   • For hourly employees, enter the hours for each class or project.
   • For commission and other pay types, enter the dollar amount for each class or project. 
7. If needed, select Create ⨁ to add more classes or projects to each employee’s pay type. Or select Delete to remove them. 
8. When finished, select Confirm. 
9. Send your payroll as normal. 

Step 2: Run your Profit and Loss reports

1. Go to Reports (Take me there) and select Standard reports.
2. From Type report name here ▼ dropdown, enter Profit and Loss by Class or Profit and Loss by Customer.
   • Profit and Loss by Class includes your total payroll expenses for each class you selected.
   • Profit and Loss by Customer includes your total payroll expenses for each project or customer you selected. 
3. Select the Report period ▼ dropdown, and select your desired date range. 
4. Save your reports as needed. 

Fix paycheques missing classes

Fix paper cheques only

1. Go to Payroll and select Employees (Take me there).
2. Select Paycheque list.
3. Select the Filter ▼ dropdown, then update the date range to July 9 - August 27.
4. From the Print pay stub ▼ dropdown, select Edit on a paycheque. 
5. Select Edit classes & projects.
6. Update the classes as needed, then select Confirm. 
7. Select Save. 

Fix direct deposit cheques

If you need to correct the assigned classes or projects on a processed direct deposit cheque, you don't need to create a journal entry. You can edit the direct deposit cheque directly:

1. Go to Payroll and select Employees (Take me there).
2. Select Paycheque list.
3. Find the direct deposit paycheque you want to edit. Select the paycheque to open and view the paycheque details.
4. From the Make adjustment ▼ dropdown, select Edit.
5. Select Edit classes & projects.
6. Update the classes or projects as needed, then select Confirm.
7. Select Save.

To check your changes you can open the cheque again, then select Transaction journal.