SOFTWARE AND SUBSCRIPTIONS · QUICKBOOKS ONLINE & XERO
How to Categorize Zoom in QuickBooks and Xero
Last Updated: October 5, 2026Zoom is two different costs wearing one name, and one of them is not software at all. Meetings and Webinars are software subscriptions. Zoom Phone is a telephone service with per-line charges and regulatory fees attached, and it belongs with telecom. Businesses that moved their phone system to Zoom almost never moved the account — so their telecom cost appears to vanish and their software cost appears to jump.
The Short Answer
| What the charge actually is | Meetings or Webinars (per-host software), Zoom Phone (telecom, per line), add-ons such as large-meeting or recording storage, plus regulatory fees on the Phone component. |
| Where each belongs | Meetings and Webinars → software subscriptions. Zoom Phone → telephone or communications. |
| QuickBooks Online default | Office Expenses or a custom Software and Subscriptions; Utilities — Telephone for Zoom Phone. |
| Xero default | Subscriptions; Telephone & Internet for Zoom Phone. |
| Expense or balance sheet | Expenses. An annual plan paid up front is a prepayment. |
| Bank feed descriptor | Commonly contains ZOOM. Phone and Meetings often arrive on one invoice, so the split has to come from the invoice rather than the bank line. |
Zoom Phone Belongs With Telecom
If you replaced a phone system with Zoom Phone, your telephone expense did not disappear — it moved into a line labelled Zoom. Coding it as software makes telecom look like it vanished and software look like it spiked.
Two practical consequences. Year-on-year comparison of both accounts becomes meaningless across the switch. And if you ever evaluate phone providers again, the cost you need to compare is not anywhere you would look for it.
Because Meetings and Phone usually share an invoice, the split has to come from the invoice. Do it once, set the proportion, and revisit it when the plan changes.
Per-Host Licensing and the Usual Drift
Zoom licenses by host, not by participant, so cost tracks how many people need to run meetings. That number is almost always smaller than headcount — and almost always larger on the invoice than it needs to be, because hosts were added for one-off reasons and never removed.
Zoom is a common place for the quarterly licence review to find paid host seats nobody has used in months.
Zoom Categorisation FAQs
Where should Zoom Phone charges go?
With telephone or communications costs, not software. Zoom Phone is a telephone service; coding it as software makes telecom spend appear to vanish and software spend appear to jump, and both accounts stop being comparable across the switch. Since Meetings and Phone usually share an invoice, the split has to come from the invoice.
Is Zoom a software subscription?
Meetings and Webinars are — per-host software subscriptions. The Phone product is telecom. Treating the whole invoice as software is the usual shortcut, and it is what makes the account misleading to anyone who later tries to read it.
This page is about where the transaction belongs in your books. Whether a cost is deductible, and how it is treated on a return, is a question for your CPA — and consistent categorisation is what lets them answer it without guessing. Dedicated bookkeepers from $75/month, extra hours at $15/hour, wholesale $10/hour for CPA firms, with a 100% money-back guarantee on your 1st retainer, refundable on the unused balance.
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