Short answer: QuickBooks Online is widely used by cannabis businesses to keep their books. What doesn't work for a plant-touching business is the money movement Intuit sells alongside it: payment processing, payroll, and bill pay. If you separate those two things, "is QuickBooks cannabis friendly" stops being a confusing question.
Use QuickBooks Online for your books. Don't count on QuickBooks to move your money.
Yes, cannabis businesses use QuickBooks Online for their books
QuickBooks Online is accounting software. It records what happened: sales, bills, payments, payroll entries, bank activity. Dispensaries, cultivators, and brands run their general ledger in it every day, and their bookkeepers and CPAs work in it. Cannabis point-of-sale and ERP vendors publish QuickBooks Online integrations for exactly that reason.
The cannabis restriction Intuit publishes sits in a different document. The Intuit Payments Inc. Acceptable Use Policy (effective 06/27/2024) covers Intuit's money-movement services, and it lists "Marijuana and CBD" as a prohibited business type for merchant payment processing and for payroll and direct deposit. That policy is written for the payments services; it doesn't address the accounting software itself.
One honest caution: terms change, and any software provider can review an account. Keep regular exports of your books, keep your source documents somewhere other than QuickBooks, and read the terms on your own subscription.
Where cannabis hits the wall: payments, payroll, and bill pay
Restricted for cannabis
QuickBooks Payments for card and bank processing, and QuickBooks Payroll and direct deposit. These move money, and Intuit's payments policy lists marijuana and CBD as prohibited. Operators also report bill pay being switched off.
Works for cannabis
QuickBooks Online as your general ledger: chart of accounts, bills, vendor records, bank feeds, reconciliation, and financial statements for your CPA.
So a dispensary can keep its books in QuickBooks Online, but it needs a cannabis-friendly payroll provider, a different way to accept non-cash payments where the state allows them, and a different way to pay vendors. Bill pay is the one that bites operators most often, usually as a notice that the feature is being turned off. We cover why, and what to do instead, in QuickBooks Bill Pay doesn't serve cannabis.
Setting up QuickBooks for a dispensary
Cannabis books in QuickBooks look like retail books with a few deliberate choices. Make them with your CPA up front, because they're painful to change later:
- Cost of goods sold, separated carefully. Under Section 280E, adult-use dispensaries can't deduct most ordinary expenses, but cost of goods sold still reduces taxable income. Your chart of accounts should make it easy for your CPA to support every dollar there.
- An inventory method. You can expense purchases when you pay, expense them when you receive them, or carry purchased product as an inventory asset and book cost of goods sold at month-end from your POS. Our accounting method guide explains each option.
- Daily sales from the POS. Post a daily summary from point-of-sale, with discounts, returns, and taxes on their own lines.
- Cash accounts that mirror reality. Separate accounts for drawers, safe, and deposits in transit make cash reconciliation possible.
- Clean vendor records. One vendor record per legal payee, so bills and payments don't scatter across near-duplicates.
Two habits keep cannabis books in QuickBooks honest. First, reconcile vendor balances against what the vendor says you owe at least monthly, because vendors re-send old invoices and miss credits more often than you'd expect. Second, tie your inventory to Metrc, not just to the POS: if the state system says a package arrived and your books don't show the bill, or the other way around, find out why before the month closes.
The step-by-step version lives in our dispensary QuickBooks setup guide, and the inventory-asset approach in perpetual inventory in QuickBooks.
How ShelfSpace feeds QuickBooks Online
We run your payables (and, for brands, your receivables) outside QuickBooks, then write every transaction into it so your books stay current without anyone re-keying invoices. For a dispensary, here's what posts:
The vendor bill
When product is received, the delivery posts as a Bill to the matched QuickBooks vendor, with the invoice PDF attached. On cash basis, the cost posts when you pay instead.
The bill payment
When the vendor is paid, a Bill Payment posts with the check number and your bank account, so the bank feed can pre-match the check when it clears.
Vendor credits
When a credit for a return, damage, or shortage is applied, it posts as a Vendor Credit against the bill it reduces.
Consignment settlements
Each settlement posts as a Bill plus a Bill Payment, with the settlement report PDF attached.
Vendors are matched to your existing QuickBooks vendor records by name, and created if they don't exist. Every day, cleared and reconciled checks are read back from your QuickBooks bank feed and marked Cleared, so you can see which payments have actually settled. Brands get the mirror image: each settlement posts as an Invoice and a matching payment received. Full detail is in the QuickBooks integration docs.
Paying vendors when QuickBooks can't
The gap QuickBooks leaves is the payment itself. We pay your vendors with Check 21 checks drawn on your own bank account, on your approval, after each invoice has been checked against the Metrc manifest. The vendor can deposit the check at any U.S. bank, and the bill and payment post straight back to QuickBooks. You keep QuickBooks for the books and stop depending on it to move money. More on how that works on our check payments page.
Books
QuickBooks Online, unchanged, as your ledger
Payments
Check 21 checks drawn on your own bank account
Proof
every invoice checked against Metrc before it's paid
If your QuickBooks is behind because nobody has time to key invoices, or bill pay just got switched off, start with the free review. We'll show you what's owed to you and what's sitting unmatched before you change anything.
Sources: Intuit Payments Inc. Acceptable Use Policy (effective 06/27/2024). Policies change; read the current terms for each Intuit product you use. This article is general information, not legal or tax advice.