Zoho Books Review: Features & Pricing for 2024

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• Zoho Books vs QuickBooks Online
• Zoho Books vs Xero
• Zoho Books vs FreshBooks

Zoho Books has all the basic features I expect in an accounting program, which is why it nailed my assessment of the category. I can customize my chart of accounts and use account numbers if I prefer. It’s easy to add and customize the access rights of additional users, including inviting my external accountant to view my books. Custom tags allow me to classify separate transactions by my chosen criteria—like location, division, or product class.

Important for larger companies with multiple users, you can set a closing date that prevents other users from changing prior-period information. This is a crucial year-end step that ensures nothing changes once your books are closed and tax returns are prepared.

Our Zoho Books General Features Video

Zoho Books has excellent banking features, including the ability to print checks—which seems basic but isn’t generally available in Zoho’s cheaper competitors like Wave and ZipBooks. I can choose between importing bank transactions through a live bank connection or uploading them from a bank statement or CSV file. Once imported, Zoho Books recommends classifications and tries to match them to any existing transactions in my books. I can easily change any recommendations that are incorrect.

Monthly bank reconciliations are a fundamental of good bookkeeping, and Zoho Books provides an easy way for me to reconcile my accounts. It will automatically mark any imported transactions as cleared, which might save me a few minutes. It also allows me to manually enter a statement balance and then manually mark transactions as cleared. This is great if I don’t want to import bank transactions because I enter everything as soon as it happens rather than waiting for it to clear the bank.

The only thing I found missing in Zoho Books is a good undeposited funds feature, which allows customer payments to be grouped into single deposit amounts so that the amount of the deposit in my check register matches the amount on the bank statement. This cost Zoho Books points in my evaluation.

While it provides an undeposited funds account, you have to manually track undeposited cash and checks in that account. QuickBooks does a better job by actually listing individual customer payments sitting in undeposited funds. These payments can be clicked and automatically added to a deposit slip.

Our Zoho Books Banking & Cash Management Features Video

Invoicing is a crucial function for almost every business—and Zoho Books aced my review of the feature. Of course, it handles the basics, like printing or emailing invoices, accepting short payments from customers, and issuing credit payments. However, I was happy to see it also handles the more unusual stuff like refunding credit balances, adding labor and expenses to invoices, and setting up recurring invoices.

Invoice Customization

Zoho Books gave me plenty of options for customizing my invoice. Not only could I add my logo and change the colors, but I could make more substantial customizations, like deciding which fields should be included on the invoice. I can even create custom fields to be added to my invoice.

Sample customized invoice in Zoho Books

A unique invoicing feature is the ability to send your invoice in different languages and choose the appropriate currency based on the particular location of your business or customer. You can send recurring invoices or schedule them to be sent in advance and add attachments, discounts, shipping charges, and a salesperson field. When your invoice is sent, it reminds customers of unpaid balances, allowing easy payment.

Our Zoho Books A/R Video

Zoho Books has great general A/P features that let me manage my unpaid bills—it’s easy to create, track, and pay bills. It also handles a few of the more unusual situations, like recording credits issued by your vendors and then applying those credits to your bills before paying them.

When I have periodic payments to make, such as utility bills and monthly marketing expenses, I can set up recurring payments and add payment reminders so that I can track bills to be paid easily. Recurring expenses can be scheduled to be sent out every week, every two weeks, every month, or at any frequency I desire.

Creating recurring expenses in Zoho Books

One shortfall of Zoho Books is the inability to initiate online payments to my vendors like I can with the QuickBooks Bill Pay feature within QuickBooks Online. Melio and BILL are great third-party apps for making online payments, but neither of these integrates with Zoho Books. Another weakness of the A/P features in Zoho Books is that receipt capture costs an additional $10 per month for 50 scans. QuickBooks and Xero include unlimited receipt scans for free.

Zoho Books A/P Features Video

Zoho Books has complete inventory tracking features for tracking stock levels. It will track the cost of goods available for sale and divide that cost between the ending inventory and the COGS. I could even sort items based on product details, vendor details, and stock keeping units (SKUs). For retailers that suffer shrinkage, inventory quantities can be manually adjusted, and Zoho Books will automatically deduct the cost of the lost inventory.

Another useful inventory tool is the Price List feature, which provides a convenient way to customize item prices for specific customers (i.e., family and friends and high-volume customers). If inventory accounting is important to you, then Zoho Books is a great choice.

The only inventory feature missing from Zoho Book is the ability to choose between multiple inventory cost-flow assumptions—like LIFO and average cost. The program only allows LIFO, which can present a big problem if you switch to Zoho Books and are currently using average cost on your tax return.

You’ll need to request a change in accounting method from the IRS to change from average cost to FIFO. The lack of choices for inventory costing is pretty typical among small business accounting software, however, including QuickBooks Online.

Zoho Books aced project accounting. I can create multiple projects for clients and assign income, expenses, and inventory to each project. I can then view the income and loss per project.

I can also create estimates and assign them to projects. When the estimate is approved by the client and ready to invoice, I can easily convert it to an invoice. Unlike in QuickBooks Online, I can view my actual income and expenses compared to my estimated income and expenses by project.

Estimates can be easily converted to invoices in Zoho Books

Zoho Books provides the level of project accounting I expect from a general bookkeeping system, but if you need a more sophisticated system, explore our list of the best project accounting software.

Our Zoho Books Project Accounting Features Video

Zoho Books handles the basics of sales tax accounting. I can manually set up as many sales tax jurisdictions as necessary, then separately track sales tax collections and view the accumulated sales tax liabilities. When it’s time to remit the tax, Zoho Books will automatically record the payment against the liability to the appropriate jurisdiction. For brick-and-mortar businesses that are only doing business locally, these features should suffice.

However, if you are an ecommerce business that must collect sales for a large number of jurisdictions, Zoho Books isn’t great unless you buy an integration. On the other hand, QuickBooks Online works well with multiple jurisdictions because it determines the appropriate jurisdiction based on the customer’s address. Luckily, Zoho Books does integrate with Avalara, which provides excellent ecommerce sales tax features.

Zoho Books has an excellent selection of financial and accounting reports. These include a general business overview, P&L statements, cash flow statements, balance sheets, general ledger, trial balance, and A/P and A/R aging reports. Other handy management reports include transaction lists by customer and vendor and a separation of the income statement by class and location.

Zoho Books has—hands down—the best mobile app among all the small business accounting software I’ve reviewed. Available on iOS and Android devices, it offers all the mobile accounting features I wanted to see, including the ability to send invoices, receive payments, capture expense receipts, record time worked, and view reports. If you need an accounting app that can help you stay on top of your books even when you’re on the road, then Zoho Books is a great choice.

Zoho Books integrates with a huge array of other Zoho products that can be used to manage your business. They have what I view as the most important integrations—including payroll, time tracking, customer payment processing, and sales tax.

However, I can’t find an integration to initiate online payments to your vendors. Two of the most popular vendor payment services are BILL and Melio, but neither offers a Zoho Books integration.

I scored Zoho Books poorly in terms of usability, mostly because of a lack of bookkeeping support in the US. It’s a great accounting program, but you’ll be more or less on your own when you have bookkeeping questions. I evaluated usability in four categories.

Yes, it is. If you only need five users and need project accounting and inventory, you can save with Zoho Books Professional ($50 monthly per organization), as opposed to QuickBooks Online ($99 a month).

Zoho Books’ biggest strengths over its competitors are its fully-featured mobile accounting app and integration with the entire line of Zoho apps, which help users manage all aspects of the business.

Depending on your needs, you may prefer QuickBooks Online, Sage 50 Accounting, or Wave. For instance, if you want a free solution, choose Wave. If you want easy access to local bookkeepers, QuickBooks Online might be better. Read our guide on the best small business accounting software for more options.