A chart of accounts is the complete list of the accounts in a company's books and their balances. Every transaction posts to at least one of them. Balance sheet accounts hold assets, liabilities and equity, such as bank accounts, receivables and loans. Income and expense accounts track what the business earns and spends. In QuickBooks Online, Simple Start, Essentials and Plus allow up to 250 accounts, Advanced has no limit, and only active accounts count. Account numbers are optional. Each legal entity keeps its own chart of accounts in its own books.
What is a chart of accounts?
It is the list of every account in your books. Intuit describes it as "a complete list of your company's accounts and their balances." When you record a payment, a fee or a refund, you choose which accounts it hits. The chart is the menu you choose from.
What types of accounts does it hold?
Two broad groups:
- Balance sheet accounts record what the business owns and owes. Assets include bank accounts, receivables and equipment. Liabilities include loans, credit cards and money received before it is earned. Equity is what is left for the owners.
- Income and expense accounts record what the business earns and spends over a period. They make up the profit and loss report.
QuickBooks Online creates a set of default accounts when you start, such as Accounts Receivable, Accounts Payable, Retained Earnings, Sales Tax Payable and Undeposited Funds. You add the rest.
How many accounts can you have in QuickBooks Online?
| Plan | Chart of accounts limit |
|---|---|
| Simple Start | 250 |
| Essentials | 250 |
| Plus | 250 |
| Advanced | Unlimited |
Intuit counts only active accounts toward the limit. Inactive accounts don't use up the allowance.
Do accounts need numbers?
No. QuickBooks Online lets you add account numbers but doesn't require them. Intuit suggests using them if your accountant recommends it. Many accountants like them because they keep accounts in a fixed order and make imports easier.
What are subaccounts?
A subaccount sits under a parent account and rolls up into it. Intuit's example is a "Meals" parent with "Meals with clients" and "Travel meals" under it. You can lock a parent account so transactions post only to its subaccounts. That keeps reports by subaccount complete.
Which accounts does a business that takes payment plans usually add?
The exact names are for you and your accountant. These are the ones that tend to come up when customers pay over time by card and bank transfer:
| Account | Type | What it holds |
|---|---|---|
| Accounts receivable | Asset | Plan balances customers still owe |
| Stripe clearing | Asset | Payments collected but not yet paid out to the bank |
| Deferred revenue | Liability | Money received before the work is delivered |
| Customer deposits | Liability | Deposits held until a program or job starts |
| Merchant processing fees | Expense | Card and bank payment fees |
| Refunds | Contra-income or expense | Money returned to customers |
A clearing account keeps payouts from being recorded as sales. A deferred revenue account keeps a deposit from counting as income before it is earned.
Does every location get its own chart of accounts?
Every legal entity does, because each entity keeps its own books. Locations inside one entity usually share one chart and are told apart with class or location tracking, not with a copy of every account per location. Keeping the same chart across all your entities makes them much easier to compare and combine. See multi-entity accounting.
How do you keep it tidy?
- Add an account only when a report needs it. Use classes or locations for "which site," not new accounts.
- Make an account inactive rather than deleting it, so past reports still read correctly.
- Agree the chart with your accountant before you connect billing or payment tools that post to it.
General information, not accounting or tax advice.
Every figure on this page was checked against these sources on Oct 6, 2026. General information, not legal or tax advice.