Free invoicing or full accounting? Pick the one that fits today.
Zoho makes two products that both send invoices: Zoho Invoice and Zoho Books. They look alike, and many small businesses are not sure which one they need. The short version: Zoho Invoice handles billing, while Zoho Books handles billing and the rest of your accounting. This guide explains what each one does, where Zoho Invoice stops, why Zoho Books' free plan is often the better starting point, and when it is time to move up. It is part of our Zoho Books guide.
Choose Zoho Invoice if you only need to send quotes and invoices, track time and get paid. Choose Zoho Books if you also need bank reconciliation, bills, financial statements, sales tax reporting or an accountant working in the same system. Zoho Books has a free plan for businesses under $50,000 in annual revenue, which often makes it the better starting point.
| Zoho Invoice | Zoho Books | |
|---|---|---|
| Purpose | Billing and getting paid | Full accounting, including billing |
| Quotes and invoices | Yes | Yes |
| Recurring invoices and reminders | Yes | Yes |
| Online payments and client portal | Yes | Yes |
| Time tracking for billing | Yes | Yes, with project accounting |
| Bills and vendor payments | No | Yes |
| Bank feeds and reconciliation | No | Yes (bank feeds on paid plans) |
| Chart of accounts and financial statements | No | Yes |
| Sales tax reports | Basic tax on invoices | Full tax tracking and reports |
| Accountant access | No | Yes |
| Price | Free | Free plan, paid plans from $15 per month billed yearly |
Zoho Invoice is a free invoicing app. It suits freelancers, consultants and very small businesses whose main need is to send professional quotes and invoices, accept online payments, track billable time and follow up on unpaid invoices. It is not accounting software: there is no general ledger, no bank reconciliation and no profit and loss statement, so your accountant still needs another system or spreadsheet at year end.
Zoho sets usage limits on Zoho Invoice, such as an annual invoice allowance, and adjusts them from time to time. Check the Zoho Invoice site for the current terms.
Zoho Books does everything Zoho Invoice does and adds the accounting around it: bills and expenses, bank feeds and reconciliation, a chart of accounts, sales tax tracking, inventory basics, projects and the financial reports your accountant needs. Your accountant can log in, review transactions and run reports without you exporting anything. See our Zoho Books guide for the full feature set.
Many businesses compare Zoho Invoice with paid Zoho Books and stop there. But Zoho Books also has a free plan, available while your annual revenue stays under $50,000. It includes up to 1,000 invoices a year, expense tracking, bank reconciliation, reports, a client portal, online payments and one user plus your accountant. The main things missing are automatic bank feeds and extra users, which arrive with the paid plans.
For a business that expects to need real accounting soon, starting on the Zoho Books free plan avoids moving systems later.
Ask your accountant before choosing. Most will want a proper ledger, reconciled bank accounts, a profit and loss statement and a balance sheet at year end, plus their own login. Zoho Invoice cannot provide those, so an accountant working with an Invoice user usually rebuilds the books from exports and bank statements, which costs you their time. Zoho Books gives them all of it directly.
A freelance designer starts on Zoho Invoice, sending a few invoices a month and taking card payments online. After a year, she hires a part-time assistant, starts paying for software and contractors, and her accountant asks for monthly reconciliations. At that point she moves to Zoho Books, starting on the free plan while revenue is under $50,000, and upgrades to Standard for bank feeds and an extra user when the business grows. Had she known her accountant's needs earlier, starting on the Books free plan would have saved the move.
| Your situation | Better choice | Why |
|---|---|---|
| Freelancer who only needs to bill clients | Zoho Invoice | Free, simple and focused on getting paid |
| Freelancer whose accountant wants proper books | Zoho Books (free plan) | Accounting and accountant access at no cost under $50K revenue |
| Small business with bills, bank accounts and sales tax | Zoho Books | Full accounting in one system |
| Business using Zoho CRM | Zoho Books | Deeper CRM integration for quotes, sales orders and invoices |
| Business holding stock | Zoho Books, plus Zoho Inventory as you grow | Inventory and accounting stay connected |
Both products save time on billing with templates, recurring invoices, online payments and automatic reminders. Zoho Books adds the bigger savings that come later in the month: bank feeds and matching rules that reconcile most transactions automatically, bills that are tracked and paid on schedule, and reports that are ready for your accountant without exports. For a business with regular expenses and several bank accounts, those savings usually outweigh the price of a paid Books plan.
Pick a go-live date, usually the start of a month or quarter.
Export customers, items and open invoices from Zoho Invoice.
Set up Zoho Books with your accountant: chart of accounts, taxes and opening balances as of the go-live date.
Import customers and items, then enter or import open invoices so receivables are correct.
Connect bank accounts and payment gateways, and update invoice templates and payment terms.
Send new invoices from Zoho Books from the go-live date onward.
Our Zoho Books setup guide walks through the setup in detail, and our Zoho Books pricing guide helps you pick a plan.
If you also need CRM, email marketing, help desk or other apps, compare Zoho One, which includes Zoho Books with the rest of Zoho's business apps. For businesses using three or more Zoho apps, the bundle often costs less than buying apps separately. See our Finance & Operations guide for how the finance apps fit together.
Zoho Invoice is a free invoicing app for quotes, invoices, payments and time tracking. Zoho Books includes all of that plus full accounting: bills, bank reconciliation, a chart of accounts, sales tax reports, financial statements and accountant access.
Yes. Zoho Invoice is free to use, with usage limits that Zoho sets and adjusts from time to time. Check Zoho's site for the current limits.
Yes. Zoho Books has a free plan for businesses under $50,000 in annual revenue, with up to 1,000 invoices a year and one user plus an accountant. Automatic bank feeds and extra users come with the paid plans.
Yes. Export customers, items and open invoices from Zoho Invoice, set up Zoho Books with opening balances as of a go-live date, then import the data and start invoicing from Books.
If you only need to bill clients, Zoho Invoice. If your accountant wants proper books or you have expenses and bank accounts to reconcile, start on the Zoho Books free plan.
Zoho Invoice offers integrations with other Zoho apps, but businesses that want quotes, sales orders and invoices connected to CRM deals usually choose Zoho Books, which has a deeper Zoho CRM integration.
There is little reason to. Zoho Books includes everything Zoho Invoice does, so once you move to Books, send all invoices from it to keep receivables and reports in one place.
We help businesses choose the right setup and get Zoho Books configured correctly from day one.