For small business owners seeking an accounting solution, ZipBooks provides several tools that can help streamline financial management. Its free accounting software enables small businesses to send invoices, manage vendors & customers, and accept digital payments.
Upgrading to one of its paid plans unlocks additional features. Read this ZipBooks review to learn more about what it offers and whether it’s the right accounting software for your small business.
What is ZipBooks
ZipBooks provides accounting software for small businesses, emphasizing simplicity and affordability. The software automates bookkeeping tasks, manages vendors and customers, generates reports, and more.
As a newer accounting solution, it has introduced several valuable features over the past year. The platform includes a free version and three paid plans.
Who is ZipBooks Accounting Software Best for?
ZipBooks works best for small business owners seeking user-friendly and affordable accounting software. Its tools suit sole proprietorships, freelancers, and consultants perfectly.
For small businesses with employees, its payroll integration features provide additional value.
The software excels for service-based businesses, offering robust time tracking capabilities that enable billing customers for services and time spent.
Retail businesses should look elsewhere, as the software currently lacks inventory management tools.
What does ZipBooks Offer?
ZipBooks delivers features comparable to software like Quickbooks Online, making it a viable option for small business owners.
Here’s a breakdown of ZipBooks’ key features:
Dashboard
The dashboard provides users with a clean, intuitive display. Charts including Financial Performance, Accounts Receivable, Transactions, and Business Health Score deliver an informative overview of your business performance.
Invoicing
ZipBooks’ invoicing feature allows you to easily configure defaults like notes, terms, and email messages. Paid plan upgrades unlock recurring invoices and automated reminders.
ZipBooks provides an invoice health score—essentially a quality rating that suggests improvements for your invoices. However, there’s only one invoice template with limited customization options.
You can also create purchase orders within ZipBooks. The Smarter or Sophisticated plans include automatic receipt generation when payments are received.
Accounting
ZipBooks offers solid accounting capabilities, including double-entry accounting. The free Starter plan allows connection to a single bank account.
The chart of accounts accommodates any small business and allows additional account creation. Categories include Assets, Liabilities, Owner’s Equity, Revenue, and Expenses.
These categories feature color-coding, and paid plans offer chart of accounts customization.
ZipBooks employs auto-categorization and remembers how you’ve classified previous transactions, reducing time spent on transaction categorization.
Accounts Payable
For expense management, you can create bills and enter amounts for individual line items.
However, the accounts receivable feature has limitations—there’s no option to adjust quantities.
Estimates
Creating estimates follows the same process as invoice creation. You can configure default notes, terms, and email messages.
When customers accept estimates, converting them to invoices requires just one click.
Client Portal
Customers access their dedicated client portal to receive estimates and quotes, accept or decline proposals, and view and pay invoices.
Growth Plan subscribers can enable client reviews within the portal.
Time Tracking
Consultants, independent contractors, and time-based professionals will appreciate ZipBooks’ time tracking capabilities.
The timer sits prominently on the dashboard for easy access. Clicking the green arrow starts time tracking after selecting the project or customer and adding notes.
You can stop and restart the timer multiple times, adding billing notes with each restart.
Time tracking isn’t available on the Starter plan.
Reporting
ZipBooks goes beyond basic reporting, offering financial statements, accounting & tax reports, sales reports, expense reports, and tracking reports. However, advanced reporting options like export choices and customizations are limited.
ZipBooks features Intelligence reporting, including Business Health Score, Invoice Quality Score, and Smart Search functionality.
The Business Health Score tracks your business’s financial performance, while Smart Search helps locate customers, invoices, vendors, or bills within the system.
Vendor and Customer Management
ZipBooks tracks both customers and vendors effectively. Contacts are classified as vendors when you pay them and customers when they pay you.
A 1099 contractor checkbox helps identify vendor contacts. All payments and vendor details are tracked for year-end 1099 processing.
Expense Tracking
Track expenses through three methods: manual transaction entry, bank statement import, or direct bank account connection.
ZipBooks lacks automatic transaction categorization and custom bank rules. You can attach documents to transactions and split them when necessary.
Items List
ZipBooks lacks comprehensive inventory management tools and doesn’t track inventory. The platform allows adding items with descriptions, prices, SKUs, default categories, and invoice/bill designations.
Items can’t be used for both bills and invoices, requiring separate item creation.
Project Management
The Smarter and Sophisticated plans include project management and basic job costing capabilities. Projects can include contacts, billing methods, budgets, and descriptions.
Budgets can be broken down into tasks with associated expenses and time requirements. You can attach invoices to projects and assign projects to employees.
Sales Tax
For businesses operating across multiple counties or states, you can add unlimited sales tax rates. Year-end tax reports show total tax collected.
ZipBooks supports VAT and sales tax standards for various countries, including Canada.
Multiple Currencies
ZipBooks supports over 160 currencies with automatic exchange rate updates.
How much does ZipBooks Cost?
ZipBooks offers a free plan plus three paid versions. Here’s what each plan includes:
Starter Plan
The free plan includes these features:
- Send unlimited invoices
- Management unlimited vendors & customers
- Accept digital payments (Square or PayPal)
- View basic reports
- Connect one bank account
The free plan provides an excellent way to test ZipBooks, particularly for new businesses. However, it lacks advanced features available in paid plans.
Smarter Plan
The Smarter plan includes all Starter features plus:
- Schedule recurring invoices with auto-bill
- Automate reminders
- Save invoice line items
- Connect multiple bank accounts
- Receive account notifications
- Time Tracking
- Add up to five users
A free 30-day trial is available for the Smarter plan, after which it costs $15 monthly.
Sophisticated Plan
The Sophisticated plan includes everything from previous plans plus:
- Organize books with smart tagging (by location, project, and custom)
- Customize categories (chart of accounts)
- Reconcile every account quickly
- Lock completed books
- Share documents securely
- Generate insightful reports
- Invited unlimited users
The Sophisticated plan offers a 30-day free trial, then costs $35 monthly.
Accountant Plan
The Accountant plan includes all previous features plus advanced capabilities:
- Text clients directly from ZipBooks
- Track time across client accounts
- Export financial packages
- Cobrand your firm on client accounts
- Edit transactions in bulk
- Management clients from one dashboard
- Migrate existing accounting data
This plan targets accounting professionals managing multiple clients. Pricing varies based on license count and monthly messaging needs (SMS and email).
For those intimidated by general ledgers, balance sheets, and accrual accounting, ZipBooks offers professional help. Their ZipBooks Pro service connects you with a personal bookkeeper for $125 monthly.
ZipBooks Pros and Cons
Pro: Free accounting software
ZipBooks provides genuinely free accounting software with single-user access—ideal for businesses just starting out.
Pro: Easy to use
ZipBooks requires no accounting or bookkeeping background. The software’s minimal learning curve allows you to create invoices quickly.
Pro: Feature-rich platform
ZipBooks offers numerous valuable features that expand with paid upgrades. Even the free plan includes essential capabilities like unlimited invoicing and digital payment processing.
Pro: Strong Customer Support
ZipBooks provides extensive learning and support resources. Their customer support is known for speed and helpfulness, available through in-app chat and email.
Additional resources include a comprehensive help center, demo scheduling, YouTube videos, blog content, and active social media presence on Facebook, Twitter, and LinkedIn.
Pro: Professional assistance available
For those preferring to delegate accounting tasks, ZipBooks connects you with qualified experts.
Flexible accounting method switching
Switch between accrual and cash reporting instantly when needed.
Con: Premium features require payment
While unlimited invoicing is excellent for free users, essential features like time tracking require paid subscriptions.
Con: No multi-entity accounting support
ZipBooks doesn’t integrate with multiple entity accounts payable systems for centralized payment management and approvals.
Con: No inventory tracking
Retail businesses or product-heavy companies need alternative solutions for inventory management.
Con: No mobile app
ZipBooks currently offers no iOS or Android mobile application. Competitors like Zoho Books provide mobile apps enabling invoice sending, bill payments, time recording, and payment processing.
Con: No tiered user permissions
The platform doesn’t support different permission levels for various users.
Bottom Line: ZipBooks Review
ZipBooks’ affordable pricing delivers substantial value with a user-friendly interface that’s easy to master. Upgrading to paid versions unlocks increasingly useful features. Many small business owners will find ZipBooks an excellent accounting solution. However, larger businesses, those requiring inventory management, or companies needing extensive customizations might find ZipBooks insufficient. With numerous updates over the past year, the company appears committed to addressing these gaps.
