How To Mark Invoices As Paid In Zoho Books

Zoho Books is a cloud-based accounting software that helps businesses manage their finances, including creating invoices, tracking expenses, and generating reports. One of the key tasks within Zoho Books is marking invoices as paid when you receive payments from your customers.  In this article,  we will show you how to mark invoices as Paid in Zoho Books.

1. Log into Zoho Books

To start, you need to log into your Zoho Books account.

1. Open your browser and go to the Zoho Books website.
2. Enter your login credentials (email and password) and click Log In.

2. Navigate to the Invoices Section

Once you’re logged in:

1. On the left sidebar, find and click on Sales.
2. In the dropdown under Sales, select Invoices. This will take you to a list of all your invoices.

3. Locate the Invoice to Mark as Paid

1. In the Invoices section, you’ll see a list of all your invoices (open, overdue, and paid).
2. Use the filters or search bar to find the specific invoice you want to mark as paid. You can search by:
   • Invoice number
   • Customer name
   • Status (e.g., Open, Overdue)
3. Once you find the invoice you need, click on the invoice number to open it.

4. View Invoice Details

After clicking on the invoice, you’ll be directed to the invoice details page. Here, you can see:

• The invoice date
• Amount due
• Payments received
• Remaining balance

You’ll also see the option to record a payment.

5. Click on “Record Payment”

To mark the invoice as paid:

1. In the Invoice details page, look for the Record Payment button. This button is typically located near the top-right corner of the page, just under the invoice status.
2. Click on “Record Payment”. This will open a new pop-up window where you can enter payment details.

6. Enter Payment Details

In the Record Payment window, you will need to fill in the payment information. Here are the fields you’ll need to complete:

1. Payment Date: Select the date when the payment was received.
   
2. Payment Mode: Choose the mode of payment from the dropdown. Options typically include:
   • Cash
   • Bank Transfer
   • Credit Card
   • PayPal (if connected to Zoho Books)
   • Cheque
3. Amount Paid: Zoho Books will automatically fill in the total amount due in this field. If the customer paid a partial amount, you can edit this field to reflect the exact payment received.
   
4. Reference Number (optional): If the payment was made by bank transfer or cheque, you can add a reference number or cheque number for record-keeping.
5. Payment Account: Select the account where the payment is deposited, such as:
   • Bank Account (if the payment is via bank transfer)
   • Cash Account (if the payment is in cash)
   • Credit Card Account
6. Description (optional): You can add additional notes if necessary (e.g., customer remarks or invoice-specific details).

7. Apply Payment to the Invoice

1. Once you’ve filled in all the payment details, click Save and Close.
2. If the full amount is paid, Zoho Books will automatically mark the invoice as Paid. If it’s a partial payment, the invoice will show as Partially Paid, and the remaining balance will be updated.

8. Verify Payment

After marking the invoice as paid, you’ll be redirected back to the invoice page. Here’s how to verify the payment:

1. Status Update: The invoice status should now read Paid (if the full amount was received). If only a partial payment was made, the status will read Partially Paid.
   
2. Payment History: Scroll down to the payment section of the invoice to see the payment details you just recorded, including:
   • The payment date
   • The payment mode
   • Amount paid
   • Payment reference (if added)

9. Send Payment Receipt (Optional)

Once the invoice is marked as paid, you may want to send a payment receipt to your customer. Zoho Books makes it easy to do so:

1. On the Invoice details page, click on the More button (three dots) on the top-right.
2. Select Send Receipt from the dropdown.
3. Customize the email if necessary and click Send.

This will send a payment receipt to your customer, confirming that their payment has been received.

10. Review Payment in the Payments Section (Optional)

If you want to view all the payments you’ve recorded:

1. Go to the Sales tab again and select Payments from the dropdown.
2. This will show you a list of all the payments made by your customers. You can filter by date range, customer, or payment status to find specific payments.

Here you can view the payment details, download payment receipts, or even reconcile payments with your bank account.

11. Reconcile with Bank Accounts (Optional)

If you use Zoho Books to reconcile your bank transactions:

1. Go to Banking in the left sidebar.
2. Choose the appropriate bank account from the list.
3. You will see all your recorded transactions (including payments received). If any payments are missing from your bank account reconciliation, you can manually add them or mark them as reconciled.

Conclusion

Marking invoices as paid in Zoho Books is a straightforward process. By following these steps, you can easily track payments from your customers and keep your accounts updated. Whether you’re marking a single payment or reconciling a series of transactions, Zoho Books simplifies the process of managing your invoicing and payments.

If you regularly deal with payments via multiple methods (like bank transfers, credit cards, etc.), it’s important to stay organized and use Zoho Books’ payment and invoice features effectively to keep your financial records accurate and up-to-date.