Fix This Company File Needs to be Updated QuickBooks 2021 Error

This company file needs to be updated QuickBooks 2021” is an error message commonly faced by QB users. The error while updating the QuickBooks company file most noticeably shows up after you upgrade QuickBooks to a later version. QuickBooks Desktop can quickly open any company file of the same or an older version of QuickBooks. However, if the company file is of a later version than QuickBooks, then QuickBooks displays an error message. However, updating the company file is a quick process, still, the error appears in the application. This blog will discuss the process as well as some key things to keep in mind before updating the company file.

In case you face any trouble implementing any of the steps mentioned down below, contact the QuickBooks Professional Team at 1-800.579.0391.

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Key Things to Note Before Updating QuickBooks Company File

It’s important to note what is crucial before you update the company file after updating the QuickBooks Desktop version. Updating directly can lead to problems, so, therefore, it’s best advised to know some crucial guidelines beforehand. Given below are the vital points you must know:

  • Always login as an administrator in QuickBooks before updating the company file.
  • If the company file is present on a different system, it’s best advised to move that company file to the local machine and then update it. You can then move it back to the system intended.
  • No user in the network should access the file which is getting updated.
  • It’s not possible to convert the company file to QuickBooks Pro and Premier if you are using QuickBooks Enterprise.
  • Once updated QuickBooks company file cannot operate in the former version of QuickBooks. So, it’s best advised to back up the company file on a computer that uses an older version of QuickBooks.

Steps To Update QuickBooks Company File

Now that you are aware of the pre-requisites to update the company file, it’s now time to start the actual update process. Follow all the steps carefully with precision so as to get the best results.

  • Open QuickBooks and in the File tab, click on Open or Restore Company.
  • Choose from the two options.
  • If you wish to open the backup of the company file from the local storage, you can click on Local Backup.
  • Browse the company file and hit Open.
  • Enter the admin account login credentials if not already.
  • The message to update the company file appears. Click on Update Now.
  • QuickBooks will do the backup process automatically. You can change the backup location.
  • Click on Done.


In this blog, we unfolded the steps to update the QuickBooks company file after getting rid of the “This company file needs to be updated QuickBooks 2021” error message which is a common message seen by users while updating QuickBooks. But as we saw in this blog, a few simple steps can resolve the issue quickly. Implement all the steps to get the desired results. To know more about QuickBooks related issues and errors, contact the QuickBooks Team of experts at 1-800.579.0391.

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