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Getting Started On Xero

April 6, 2021
Bill Kimball

xero 101

Since Xero is fully cloud based all literature is available online. You can visit these links for information about Xero’s features and services. Don’t forget to add ATTACHMENTS to the journal entry to back up your information and further explain the purpose of the entry. Great attachments to add are receipts and invoices from the purchases involved. A basic journal entry will include a Narration , Date, Auto-reversing date , line item descriptions, accounts, and amounts, as well as a location for uploading attachments. A journal entry is a means of manually recording transactions and adjustments to your Xero accounting file. Some main reasons for posting a journal entry may be to record expenses made on personal cards, record prepaid expenses, or record a recurring expense, such as a rent reimbursement.

Although Xero offers three different plans, the first plan extremely limits the number of invoices, bills, and quotes you can utilize. Plus, if your business needs functionality beyond these limitations, you have to opt for the Growing plan, which is more than 3x as expensive as the Early plan. Now that we have an idea of what Xero and QuickBooks Online each offer, let’s take an even deeper look at how their capabilities stack up against one another. After all, the purpose of utilizing accounting software is to be able to automate and streamline your accounting tasks and overall financial processes, so you’ll want to know how these features will work for your business. Now that we know what the Xero accounting plans can offer your business in terms of both features and pricing, let’s continue our Xero vs. QuickBooks Online comparison by discussing QuickBooks.

xero 101

Finally, another report worth discussing is the “uncleared transactions” report, which accountants frequently run to show clients why their balance is lower than what’s in the bank. Moreover, if you want to pull a detailed report on accounts receivable or accounts payable, Xero does not offer a way to total those details by customer or vendor. QuickBooks Online, on the other hand, allows you to access this type of view easily. In short, the direct method means you subtract the money you spend from the money you receive.

With Xero you can view and share interactive reports and budgets – all prepared in a single click. Both accountants and businesses have a real-time view of the financials, anytime, from anywhere.

At Convex Accounting we are big fans of Xero making your business life easier, so we are offering a free series of seminars on getting the most out of Xero. The first in the series covers the basics you need to know, fishhooks to look out for, and what reports to use. Single Touch Payroll in Xero makes it easier for businesses and their employees to receive JobKeeper payments. We’re here to help as you respond to the challenges of Covid-19. This is deeply misleading since the only entertaining on which VAT and CT relief can be claimed is Staff Entertaining under certain circumstances. Entertainment of customers is a non allowable expense so you cannot reclaim any VAT even if it has been incurred, therefore code 424 should be used.

Ideally, the bank balance should be pulled directly from the bank, and in this way, Xero’s bank feed features aren’t quite as desirable as QuickBooks Online. With QuickBooks Online, you can simply add a new account right from the online banking dialogue in the Account drop-down. If you need to add a new account—say because this is the first time you’ve paid for a product or service—Xero and QuickBooks Online differ. QuickBooks Online Plus will cost $70 per month (but the three-month discount also applies to this plan). This plan costs $40 per month—and will only cost $20 per month for the first three months of your subscription with the current QuickBooks discount.

If you run your own small business, there’s really no better course you can do to master the art of maintaining your finances. Small businesses, accountants and bookkeepers in your neighbourhood and across the world trust Xero with their numbers. Access all Xero features for 30 days, then decide which plan best suits your business. Small businesses, accountants and bookkeepers locally and across the world trust Xero with their numbers. You can also save Manual Journals as Drafts, Recurring, and easily void, archive, or add notes and view the history of existing entries.

This is the Holy Grail of a well-documented journal entry, the kind of thing your CPA’s dreams are made of. Think receipts, loan statements, cash logs, emails – anything documenting and verifying the reason for making the entry should be added here. Xero is designed so you can collaborate with an accountant or bookkeeper to help you grow your business.

This being said, Xero’s 24/7 online support is notable as it allows you to receive support quickly and easily, whenever you need it. If you’re having an issue with your accounting software it’s preferable to receive support as fast as you can, in the most accessible way possible. Xero’s third-party integration options span a variety of categories and industries, truly allowing your small business to manage a multitude of processes within your accounting software, including those you already work with. With QuickBooks Online, on the other hand, time tracking is included in each plan, starting with Essentials. Not only do all four of the QuickBooks Online plans include capabilities for managing sales tax, but they each also offer tools to maximize tax deductions as well as manage 1099 payments. With these tools, you can use QuickBooks tax categories, create your own, and automatically support your expenses in preparation for filing your business taxes. You also can plan your quarterly taxes and share or export relevant tax information for your accountant.

Million Subscribers Doing Beautiful Business

With a huge range of short courses from Australia’s leading online providers, you will be sure to find a course that’s perfect for you. Top Result Advanced Xero Package Short Course This is a short course focused on skill based training rather than a nationally accredited certificate or diploma. There are countless things to keep track of when you’re running a small business – and one of the most important is your finances. With the Xero Dashboard, you can easily see your overall business performance.

xero 101

The indirect method, on the other hand, uses your net income and factors in depreciation to calculate your operating cash flow. The method you prefer will depend on how your business operates, however, it’s important to know that Xero only accommodates the direct method. In both Xero and QuickBooks Online, you can set up your products and services and map them to the appropriate accounts in your chart of accounts.

Reporting In Xero

Reporting can be one of the most important accounting software features for informing your business’s financial planning and growth. Therefore, when you’re comparing Xero accounting vs. QuickBooks Online, you’ll want to ensure that the solution you choose has the reporting capabilities you need. At Fundera, Randa specializes in reviewing small business products, software, and services. Randa has written hundreds of reviews across a wide swath of business topics including ecommerce, merchant services, accounting, credit cards, bank accounts, loan products, and payroll and human resources solutions.

All of this being said, however, in order to decide which option is best for your business, you’ll need to know more specifically what each software can offer. Therefore, let’s start our Xero vs. QuickBooks Online comparison by breaking down each solution individually.

There are many reasons why Xero has quickly become one of the most popular accounting platforms—and a top QuickBooks alternative. Finally, the time tracking capabilities that QuickBooks Online offers sets this solution apart from Xero. As you can see, both QuickBooks Online and Xero have significant capabilities to offer small businesses. This being said, now that we’ve gone through the details of these solutions, let’s highlight the most notable differences between Xero vs. QuickBooks Online so that you can determine which is better suited for your needs. Both QuickBooks Online and Xero generally cost the same, but overall, Xero is slightly cheaper.

  • The first in the series covers the basics you need to know, fishhooks to look out for, and what reports to use.
  • Those interested in mastering this savvy software will benefit greatly through a Diploma in Xero.
  • For now we will focus on the three key items small business owners and their bookkeepers need to be including in their entries.
  • We’ve got all you need to know right here about the Xero training options available in Australia.
  • With Xero accounting software, all your data is online so you can have easy access to it — anytime, anywhere, on any device.
  • At the end of the day, whether you choose Xero or QuickBooks Online, you’ll be using a top accounting software platform that will allow you to efficiently manage and streamline your accounting processes.

Another of the most notable ways in which this QuickBooks solution stands out when comparing Xero accounting vs. QuickBooks Online is with their tax tools. Although Xero includes sales tax software with all of their plans, they do not offer the same level of overall tax support as QuickBooks Online. With four plan options, each with increasing features designed to accommodate businesses of all shapes and sizes, QuickBooks Online certainly stands out in this way compared to Xero.

Small Business

Both Xero and QuickBooks have significant accounting capabilities that surely will allow you to manage and optimize your financial processes. Additionally, by all accounts, both solutions are user-friendly and relatively easy to set up and understand. Moreover, as web-based platforms that each offer a robust mobile app, both Xero and QuickBooks Online provide small business owners with substantial accessibility.

The expense will not be an allowable expense for corporation tax purposes either. At the year end, any expenses posted to 424 during the year will be added back to the corporation tax computation so that no tax relief is claimed. If you use “424 – Entertainment – 0%”, no VAT will be reclaimed on the purchase. Selecting “420 – Entertainment-100% business” will reclaim the VAT which will transfer to the VAT return. To create a packing slip for an existing invoice, you can edit the invoice and select your packing slip branding theme. Select the branding theme you set up for printing the packing slip. Hi everyone, Come on over to the new discussions in Xero Central.

You can read more about all of these features in the Xero Business Help Center. For now we will focus on the three key items small business owners and their bookkeepers need to be including in their entries. Luckily, both Xero and QuickBooks Online offer 30-day free trials—so that you can explore their software firsthand to determine how either may or may not fulfill your business’s needs. This being said, if you’re looking for the ultimate winner between QuickBooks Online vs. Xero, it’s difficult to say one solution is objectively better than the other. Instead, the Xero vs. QuickBooks Online winner ultimately depends on your business—what features you need, what your budget looks like, and what capabilities are most important to you. Moreover, if you want to add payroll capabilities to your Xero plan, you can take advantage of Xero’s partnership with Gusto payroll for direct, full-service payroll integration.

Although both platforms offer significant resources on their websites for self-service help, Xero also provides free 24/7 online support for all of their users, regardless of their plan level or even timezone. Plus, Xero doesn’t outsource their customer service—all representatives are Xero employees.

Career Prospects Of Using Xero

If you have the Advanced plan, you receive QuickBooks Premium Circle; however, this simply puts you first in line when you call customer support. With QuickBooks Online, you have to upgrade your plan level in order to add a certain amount of users—and even with the Advanced plan, you have a maximum user count of 25.

If you’d like to expand your skills and stand out from the crowd, consider investing in an Advanced Certificate. These fantastic programs can be completed in hours and are a must for small business owners as well as for any budding accounting professional. Xero has taken Australian small businesses by storm in recent years; in fact, there are now more than 312,000 paid subscribers across the country.

If you’re looking for a better way to manage your business finances, consider your search over, because Xero accounting software is the simple, stylish and sophisticated solution you’ve been dreaming of. We’ve got all you need to know right here about the Xero training options available in Australia.

However, even though Xero may not have the same value as QuickBooks Online, you’ll find that its pricing is likely better suited for medium- to large-sized businesses because it offers an unlimited number of users for all its plans. Whether you’re using Xero or QuickBooks Online, the bank feeds section will be the critical area where most of your business bookkeepingwill occur. Both of these accounting applications have solid bank feed systems. However, comparing Xero vs. QuickBooks Online’s bank feed features more closely—they look very different and will naturally appeal to different bookkeeping preferences.

Xero 101

Furthermore, Canstar Blue recently named Xero Australia’s highest-rated cloud-based small business accounting software for the second year running. Xero is cloud-based accounting software specifically designed for small to medium-sized businesses and it now boasts more than 700,000 paying customers in over 180 countries. With Xero accounting software, all your data is online so you can have easy access to it — anytime, anywhere, on any device. Explore features and tools built for small businesses, accountants and bookkeepers. At the end of the day, whether you choose Xero or QuickBooks Online, you’ll be using a top accounting software platform that will allow you to efficiently manage and streamline your accounting processes. Finally, comparing QuickBooks Online vs. Xero, Xero stands out with their customer service.