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Service businesses that bill per Zoho Projects for agencies and IT teams need to track time, Zoho Expense setup for project teamss, and budgets at the project level, bill accurately, and report profitability. Zoho Books accounting features project accounting module handles this without a separate project management tool.
If your billing includes time-based billing, fixed-fee milestones, retainer agreements, or cost-plus projects, you need project accounting. Without it, your P&L shows total revenue and costs but not which projects are profitable.
Go to Time Tracking > Projects > + New. Associate with a customer. Choose billing method: Fixed Cost, Based on Project Hours (single rate), or Based on Staff Hours (different rates per person). Set cost rate and billing rate per team member.
Team members log entries with date, hours, project, task, and description. Time can be logged via web, mobile app, or synced from Zoho implementation partner India Projects. Entries are categorised as billable or non-billable.
Tag expenses to projects when creating them. Travel, software licenses, subcontractor fees flow into the project cost calculation and can be billed to the client with markup.
Click Create Zoho Books complete setup guide from the project to compile all unbilled time and expenses into a draft invoice. Billed items are marked as invoiced and excluded from the next billing cycle.
The Project Summary report shows revenue, costs, and margin per project. Compare across your portfolio to identify which engagement types are most profitable.
Project accounting in Zoho Books connects time tracking, expenses, and invoicing under a single project record. This is particularly useful for software development firms, consulting practices, and agencies that bill clients based on hours worked or milestone completion.
To create a project, go to Time Tracking > Projects > New Project. Set the project name, assign the customer, and choose a billing method. Zoho Books offers four options: Fixed Cost (one invoice for the agreed project amount), Based on Project Hours (bill the customer for total hours logged), Based on Staff Hours (different rates per team member), and Based on Task Hours (rates vary by task type). For Indian IT services firms billing offshore clients, the Staff Hours method is the most common, since senior and junior resources carry different rates.
Once the project is created, add tasks and assign team members. Each team member can log time directly from the Zoho Books web interface or the mobile app. Logged hours show up in real time on the project dashboard, so project managers can see hours consumed versus hours budgeted without waiting for end-of-week reports.
When it is time to invoice, open the project and click Invoice This Project. Zoho Books pulls in all unbilled hours and expenses marked as billable and generates a draft invoice. You can review line items, adjust quantities, and add notes before sending. The invoice retains a link to the project, so you can always trace which hours and expenses are included in any given bill.
For projects with milestone-based billing, create invoices manually for each milestone payment and mark the corresponding hours as billed. This keeps the project’s unbilled hours register accurate.
Zoho Books includes a Project Profitability report under Time Tracking > Reports. The report shows total revenue billed, total cost (staff costs and billable expenses), and gross margin per project. For Indian service businesses, this report is the simplest way to understand which client engagements are profitable and which are not, without needing a separate spreadsheet.
If your staff costs are tracked in Zoho Payroll, you can import cost rates into Zoho Books’ project module to reflect the true cost of each team member’s hours. This gives you a fully loaded margin figure rather than just a revenue view.
Yes. When logging time, team members can mark hours as non-billable. Non-billable hours appear in the project’s time log and are included in cost calculations, but they do not appear on the client invoice. This is useful for tracking internal project management time or rework hours that you do not charge to the client.
Yes. You can create a retainer invoice in Zoho Books for a fixed monthly amount. As work is done during the month, you log time and expenses against the project. At month-end, you can compare the retainer amount against actual hours billed and issue a top-up invoice or credit note for any difference. This workflow works well for consulting firms and managed service providers.
Yes. Each team member with access to the project can log time independently. Zoho Books consolidates all time entries under the project record. There is no conflict if two people log hours at the same time on the same project, and the system maintains a full audit trail of who logged what and when.
For service businesses that generate projects from won deals in Zoho CRM, the Zoho Books and Zoho CRM integration allows you to create a project directly from a closed-won opportunity. The customer and scope details carry over automatically. This removes the risk of billing errors caused by manually re-entering contract details into Zoho Books after a deal closes.
Once the project is linked to a Zoho CRM account, the invoice history from Zoho Books appears inside the Zoho CRM account record. Account managers can see how much revenue has been billed and collected from each client without needing access to Zoho Books directly. This is useful for account review meetings and renewal conversations.
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