ZipBooks Review: Features, Pricing & Alternatives

ZipBooks, cloud-based accounting software, helps you balance your books effectively, get paid faster, and make informed business decisions through actionable insights. While it may not pack the punch of some higher-priced competitors, it is straightforward and offers excellent value for small service-based businesses.

If your business doesn’t require complex invoicing or bill payments, ZipBooks can be a solid choice. However, it’s not ideal for those that manage inventory or rely on ecommerce integrations. It includes a free plan, and its paid options start at just $15 per month. That said, I recommend Sophisticated at $35 monthly. The lower tiers lack some key features, like the ability to customize your chart of accounts—something most businesses will need sooner or later.

Why you can trust Fit Small Business

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My methodology

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ZipBooks Alternatives & Comparisons

Our Comparison of ZipBooks vs Other Software

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Here are the common user sentiments, along with my expert insights:

• Outstanding user interface: Customers like ZipBooks’ ease of use, clean layout, and user-friendly design. I agree with customers because when I had the chance to explore ZipBooks’ free plan, the interface was clean and neat. The elements are not overwhelming, and the design is not harsh to the eyes.
• Enough for basic users: Reviewers like that it offers only the basic features they need, avoiding unnecessary clutter found in more complex programs. Its simplicity makes it an excellent choice for those who don’t need the advanced tools included in platforms like QuickBooks.
• No confirmation when upgrading: Clicking on a paid feature automatically upgrades your subscription without confirmation, which I found inconvenient. While ZipBooks does mark paid features with a symbol, you need to stay vigilant to avoid accidental upgrades. However, when I was testing the free plan, the automatic upgrades started a free trial period versus actually charging me immediately.

The overall user reviews are generally positive, but the number of total reviews is limited. Here are the average ZipBooks review scores on third-party sites:

• Capterra: 4.5 out of 5 based on over 100 reviews
• G2: 4.7 out of 5 based on around 85 reviews

Fit Small Business Case Study

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ZipBooks holds up well in terms of value, general features, and reporting, but it truly shines in project accounting. What I appreciate is its affordable pricing and impressive feature set. However, compared with QuickBooks Online Essentials, ZipBooks falls short in A/R and A/P but performs similarly in these areas when compared with Wave Pro.

While QuickBooks Online Essentials isn’t the most recommended plan in the QuickBooks lineup, it competes closely with ZipBooks. In this matchup, the deciding factor often comes down to price. ZipBooks wins some battles and loses others, but its price advantage—being almost half the cost of QuickBooks—can make it the more appealing choice. On the other hand, Wave Pro is even cheaper at only $16 a month, making it attractive, though it lacks any meaningful project accounting.

For freelancers, Wave is often the better choice than either ZipBooks Sophisticated or ZipBooks Free. Wave’s free version offers more robust accounting features than ZipBooks’ free tier. However, ZipBooks isn’t a long-term solution for businesses planning to scale. You’re better off starting with QuickBooks Online Essentials and upgrading to Plus or Advanced as your needs grow.

ZipBooks Pricing

In my evaluation, I looked at both pricing and quality to determine ZipBooks’ Value score, which I rated 4.5 out of 5. I believe this reflects the balance between the cost and the quality it offers. With its highest plan priced at just $35 per month, ZipBooks is reasonably affordable.

That said, ZipBooks does lack some advanced features. However, I don’t think this makes it inferior to or less capable than similar software. Instead, it just focuses on essential tools, which is justifiable given its pricing. For users who don’t need extra features, ZipBooks delivers good value.

ZipBooks has a fresh, clean design that’s easy to navigate. The dashboard is simple and informative, with a quick-access menu on the left side. If you need to see more options, you can click More on the top right next to the bell icon.

One thing I noticed is the absence of a feature to add new transactions directly from the dashboard, which many other software include. For instance, adding an “Add Transaction” button would make the dashboard even more convenient.

Setting up your company in ZipBooks is straightforward. The settings are user-friendly, allowing you to easily update your company name, details, and other information in the Company settings module. In the Accounting Preferences section, you can configure key accounting options like your accounting basis and the closing date for your books.

However, the setup process lacks options for recording a fiscal year-end, specifying an entity type, and importing beginning account balances. The only way to input a beginning balance for an account is by creating journal entries.

ZipBooks comes with a default COA ready to use as soon as you purchase the software. If you’re on the Sophisticated plan, you can expand the COA by adding accounts for items like depreciation, amortization, and bad debts. For instance, I noticed the COA doesn’t include an Accumulated Depreciation account, so I created one and assigned Fixed Assets as its parent account.

The equity section of the COA is tailored for sole proprietorships, but it’s flexible enough to modify. You can add accounts—such as Common Stock, Additional Paid-in Capital, and Retained Earnings—to better suit your business structure.

Our ZipBooks General Features Video

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Reconciling your checking account in ZipBooks is straightforward—just ensure you enable “Reconciliation” on the COA first for each account you want to reconcile. ZipBooks approaches bank reconciliation differently than most accounting software. It doesn’t display standard line items like deposits in transit or outstanding checks, which is why I couldn’t award a higher score. Instead, it simply shows the difference between the book and bank balances.

To reconcile, you can uncheck the items listed by ZipBooks or create an adjustment entry for charges appearing in the bank statement that aren’t yet recorded in the books. When your reconciliation is in balance, the difference on the reconciliation screen will change to the number of outstanding transactions—which is the number of transactions left unmarked.

Unfortunately, while you know you’re in balance, you won’t be able to finalize your reconciliation if you have outstanding transactions. This is a pretty big issue if you write a lot of paper checks.

Another downside I’ve found with ZipBooks’ banking features is that it can’t produce a reconciliation report or print checks. If you regularly issue checks for vendor payments, I’d suggest looking into QuickBooks Online, which offers both check printing and comprehensive bank reconciliation features.

Our ZipBooks Banking Video

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The basic invoicing function in ZipBooks is decent, though not the most impressive I’ve seen. You can upload your logo and select a custom color for the invoice, but the template’s layout isn’t customizable. On the plus side, you can add a personalized message at the bottom of the invoice.

What I like about ZipBooks’ invoicing is that it allows users to add unbilled expenses and time to customer invoices, a feature typically found only in higher-priced plans like QuickBooks Online Plus. The Sophisticated plan costs $35 per month, which gives ZipBooks a competitive edge over similarly priced software.

Another useful feature is the ability to accept partial payments on invoices. When a customer makes a partial payment, ZipBooks marks the invoice as “Partial” and displays the amount paid alongside the total invoice amount on the invoice screen.

That said, ZipBooks is missing some key A/R features found in other software. One major drawback is the inability to issue credit memos for refunds—you’ll need to manually add a negative item to the original invoice. Additionally, it doesn’t support issuing receipts for cash sales. You have to issue an invoice first and then mark it as paid, which can be inconvenient.

Our ZipBooks A/R Video

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The A/P module is located under the Transactions tab. Creating vendors is simple, and you can even designate a vendor as a 1099 contractor. When creating bills, you can include items and specify which expense account should be debited.

However, I find it a bit inefficient that you can’t tag bills for custom grouping during their creation—being able to tag departments or projects directly while creating a bill would save time. Instead, you’re limited to tagging bills later in the Expense tab.

In the image above, I created a bill for purchasing widgets. Ideally, the software should prompt me to enter the quantity of goods purchased. However, ZipBooks only asks for the total cost, making it impossible to track inventory unit costs or calculate COGS accurately. If your business manages inventory, ZipBooks isn’t the best choice—I recommend QuickBooks Online, which offers excellent inventory accounting features.

I’ve also found that ZipBooks lacks some of its competitors’ high-end features. For instance, while you can attach images of receipts to your bills and expenses, it won’t actually read the receipt and create the transaction.

It also lacks a purchase order function, which can be useful, especially for companies dealing with inventory. Finally, one of the newest features added by QuickBooks Online is the ability to initiate electronic bill payments directly from within the software. Perhaps ZipBooks will someday add this feature as well.

Our ZipBooks A/P Video

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Unfortunately, ZipBooks lacks inventory tracking features. It doesn’t allow you to track inventory units ordered and sold, nor does it automatically record COGS or calculate the cost of ending inventory. If inventory management is essential for your business, I recommend using QuickBooks Online for its excellent stock and cost tracking capabilities.

^{Note: Inventory is touched on in the A/R and A/P video, so there isn’t a dedicated video for it.}

I find project accounting in ZipBooks commendable and convenient, especially with its built-in time tracker. I can create projects, assign contractors, and tag income and expenses directly to each project. Billable expenses are easy to convert into invoices when creating invoices.

If my clients need estimates, I can create them in the Invoice tab. I appreciate that the estimates form has a similar interface to the invoicing feature, making it simple to use.

However, ZipBooks doesn’t allow users to assign estimates to projects because you can only apply project tags to cash flow transactions, not to estimates. Of course, this makes it impossible to easily compare actual project costs with estimates. If you need project accounting features with this capability, I’d recommend Xero (read our Xero review).

Our ZipBooks Project Accounting Video

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I can create a sales tax item to track taxes collected by jurisdiction. However, the program doesn’t allow me to view my sales tax liability without printing a report. It’s also lacking features to help me determine a customer’s sales tax jurisdiction. For comparison, QuickBooks Online will automatically choose the sales tax to apply based on the customer’s address.

^{Note: Since this topic is covered in the A/R and A/P video, there’s no separate video.}

Reporting is one of ZipBooks’ strong points. It can generate the reports that I believe should be available in small business accounting software.

Here’s the summary of the reports.

• Balance Sheet
• P&L Statement
• Statement of Cash Flows
• A/R Aging
• Income/Loss by Month
• Income/Loss by Customer
• Income/Loss by Class
• Income/Loss by Location
• Income/Loss by Project
• Unbilled Charges
• Unbilled Time
• Expenses by Vendor
• General Ledger
• Trial Balance

ZipBooks doesn’t have a mobile app. If you need one, I recommend Zoho Books because it has an outstanding and full-featured mobile app that can send invoices, receive payments, assign expenses, enter bill payments, categorize bank expenses, record time, and view reports.

ZipBooks integrates with Gusto for payroll processing, which allows users to sync hours tracked in ZipBooks with Gusto automatically. This ensures that the hours paid to employees match the hours tracked for accounting. It also integrates with Square and PayPal, making it easy to accept electronic payments from customers.

I do wish ZipBooks could pay bills electronically. An integration with BILL would be a great addition, as that would allow users to send electronic payments directly from unpaid bills in ZipBooks. I’d also like to see an integration with a sales tax manager like Avalara to streamline sales tax tracking, reporting, and return filing. If you deal with many sales tax issues, Xero is the better pick because it integrates with Avalara (read our review of Xero).

In evaluating usability, I considered the four categories below.

Customer Service

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Bookkeeping Assistance

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Ease of Setup

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Ease of Use

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How I Evaluated ZipBooks

I evaluated ZipBooks and other leading small business accounting software using an internal scoring rubric with 13 major categories. You can read a more detailed description of my methodology by visiting our accounting software study page.

Frequently Asked Questions (FAQs)

Does ZipBooks do payroll?

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Is ZipBooks secure?

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Is ZipBooks legitimate?

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Bottom Line

ZipBooks provides the essential accounting functions most businesses need, as long as you don’t manage significant inventory. It’s user-friendly, even for DIY accounting. While I recommend the Sophisticated plan for service-based businesses, I’d steer clear of the Free or Smarter plans since they lack fundamental features like the ability to customize your chart of accounts.