Xero Accounting Software Review Of Pricing & Features

Xero Accounting Software Review Of Pricing & Features | Accounting Smarts
Charles Hall

Last updated by

Charles Hall


June 10, 2022

Xero accounting software currently offers some of the best features, usability, and integration options to businesses worldwide. Continue to read the full review of pricing and features.

Are you a business looking for cutting-edge accounting software? Maybe you are already using accounting software but want to explore other best options available in the market.

Either way, you are in the right place, as this post will review Xero accounting software. You will learn about the origin of this accounting software, what it does, and what features and pricing options.

So without further ado, let us dive right in.

This article may contain affiliate links where we earn a commission from qualifying purchases.


Table of contents

Xero Accounting Software: The Origins

Xero is one of a kind cloud-based accounting software from New Zealand. This accounting software has given other competitors a run for their money since its inception. Xero offers businesses with dynamic features with a sophisticated solution to accounting operations.

You can now create a wide range and volume of reports with support for over 800 plus integrations.  Additionally, it has no limitation on the number of users to use it simultaneously. The best part is that now you can take your accounts anywhere due to the cloud-based mobility with a modern and user-friendly user interface (UI).

Xero has recently introduced a project management feature that not many accounting software offers in the market. Xero has recently spiked its price tag and no longer includes a built-in payroll feature in its plan.  

Moreover, you only get expense claims, multi-currency, and project management features with expensive plans only. This may make Xero accounting software more suitable for medium to large businesses.

That said, Xero accounting software offers strong accounts reconciliation features, data imports, tracking your sales as well as purchase transactions. The recent improvements by the company in the setup process of the accounting software have made it a solid choice for all types of businesses.

Pros and Cons of Xero

Here are the good and not-so-good aspects of using Xero as your choice of accounting software.

Pros of using Xero

  • Appealing, user-friendly dashboard
  • Improved setup process
  • Interactive quotes
  • Smart lists
  • New business views
  • Amazing reconciliation tools
  • Project tracking
  • Exceptional online support
  • You can integrate it with Gusto-based payroll

Cons of Using Xero

  • Lack of chat and phone support
  • The mobile app is elementary
  • New invoice forms require labeled icons
  • There is no re-order level in your inventory
  • You have to handle expenses in a separate mobile app

Why Xero Accounting Software

Xero is a perfect solution to simplify your business's accounting process in a skillful manner. The software supports all major financial elements a business would expect from a double-entry accounting solution for small businesses.

You can manage your bills, expenses, sales and purchase records, inventory records, and payroll. Moreover, you can also create detailed records of all your employees, suppliers, customers, and items. The best part is that you can use any of these records in customizable transactions such as purchase orders, invoices, quotes, etc.

Unlike other accounting software solutions, Xero allows your business to manage fixed assets. You will be able to see your short-term cash flow and overall business snapshot.

Is Xero Good for Your Business?

If you are a business using accounting software or a basic accounting tool such as Microsoft Excel, you probably have a lot of data to deal with already. You can now use Xero because it offers an easy feature to import all your existing data from other online platforms via a direct conversion tool.

In case you already have your data in TXT or CSV format, you can import those files directly from your computer into Xero.

But what if you are a business that has never used accounting software? In that case, Xero offers you full online support, and you can watch the introductory video and a dashboard with easy UI to help you understand what you need to do, so set up your own Xero accounting site.

The steps you must follow are:

  • Connecting your business bank accounts
  • Reviewing the transaction categories of Xero
  • Managing bills

Some links will take you to the relevant pages to accomplish all these tasks. This is one of the most straightforward setup tools you will be able to get in any accounting software out there. Before you start entering your transaction data, you must create records of all contacts, services, items.

Xero Accounting Software: Pricing

Xero offers incredibly pocket-friendly pricing to businesses of all sizes. The best appeal of using this software is that there are no user limitations on any plans. However, Xero no longer includes payroll as a feature; you must purchase it as an optional add-on. Plus, certain features are now available with the most expensive price plans.

That said, you will still get live bank feeds with each plan so your business can categorize, download, and reconcile all your financial transactions hassle-free.

Xero accounting software offers three categories of price plans with a monthly payment model. There is no annual contract available, and you can opt to cancel the subscription at any point. However, you have to give Xero at least 30 days of prior notice for cancellation.

If you are not sure about using Xero in the first place, the company offers you a 30-day trial with a demo company setup. This way, you can explore Xero's features and functionalities without buying them. In case you are a non-profit organization, owner of several companies, Xero may offer you discounts.

Here is a breakup of all price plans covering all the accounting essentials your business will ever need. Rest assured as all the features and plans are secure and safe. Moreover, you will get 24/7 online support with an option to cancel at any time with a one-month prior notice.

The below-mentioned price plans are from Xero's website for US-Based Businesses

Early Price Plan

The current price of this price plan is $5.50 per month. This is a 50% discount on the usual price of $11 per month for your first two months. This plan is suitable for sole traders, freelancers, and new beginners.

The features included are

  • Enter five bills
  • Send 20 invoices and quotes
  • Reconcile your bank transactions
  • Capture all your receipts and bills with Hubdoc
  • Use multiple currencies
  • Claim expenses
  • Track business projects

You can get a payroll with Gusto as an optional add-on from $39 per month.

Growing Price Plan

This is Xero's most popular price plan amongst businesses. The original price plan is at $32 per month, but Xero is currently offering it at a 50% discount at $16 per month for the first two months of subscription. If you are a new small business in its initial days of growth, this is probably an ideal price plan for you.

The features include are

  • Sending quotes and invoices
  • Reconcile your bank transactions
  • Enter bills
  • Track projects
  • Claim expenses
  • Capture receipts and bills with Hubdoc
  • Use multiple currencies

You can get a payroll with Gusto as an optional add-on from $39 per month.

Established Price Plan

The original price of this package is $62 per month, but Xero is currently offering it at a 50% discount at $31 per month for the first two months of subscription. However, this option is most suitable for well-established companies of all sizes.

The features included are

  • Send your quotes and invoices
  • Enter bills
  • Track projects
  • Use multiple currencies
  • Capture receipts and bills with Hubdoc
  • Reconcile your bank transactions
  • Claim expenses

Like the other two packages, you can get a payroll with Gusto as an optional add-on from $39 per month.

Xero Features

Xero accounting software comes with several innovative features, so let us look at them one-by-one.

It is 100% Cloud-Based

Xero is a purely cloud-based accounting software solution with no need for lengthy downloads and complicated installation setups.

No matter what device you are using and which platform you are on, Xero offers compatibility with all. All you need is an Internet connection and a browser such as Google Chrome, Mozilla Firefox, Safari, or Microsoft Edge. Just make sure you are using the latest version of the browser.

Accounts Payable

You can now create and manage all your business bills using Xero accounting software. The software allows you to enable all your bills and attach any photos and related documents with them. You will also get a "Purchase Overview" screen that will display all the details about your purchase orders and bills.

Appearance and Navigation

Unlike other accounting software solutions with scattered features and functionalities, Xero offers a compact user interface taking up minimal space on your computer screen. The dashboard presents vital financial data of your business and links to their relevant activities.

The tools include the following:

  • Account balances
  • Numerical and graphical  representation of unpaid bills and outstanding invoice
  • Links to related reconciliation screens
  • Complete financial transactions with cash in and out
  • Account watch-list
  • List of your expense claims

Almost all features on Xero's dashboard have a link that can take you to the relevant actions and pages. The tabs on Xero run horizontally across the top while dividing the entire site into functional groups logically. These include your dashboard, projects, contacts, and business accounting.

Simply click on your business name on the upper left, and this will take you to settings and several other housekeeping tasks. Your business menu is where you will be spending most of your time working on Xero accounting software. This page opens several functions such as pending bills and payments, invoices, and other products and/or services.

Accounts Charts Management

You can now automatically create default accounts charts on Xero based on the industry your business belongs to. You can even customize these charts or import your own charts of accounts into Xero.

Checks Management

Did you know that Xero comes with a feature that allows you to write, customize and/or print your business checks direct from the account? Not many software solutions out there can offer you this feature.

For mobile users, you can download a Xero accounting app for both Apple and Android devices. However, you must remember that there are separate mobile apps for Xero projects and Xero expenses, so do not forget to download them as well (if you need those features).

Customize Your Dashboard

Xero offers a customizable dashboard featuring beautiful graphical settings with labeled tabs for each category. You can even re-arrange these tabs according to your personal preference. This will give you a brand new navigation dashboard to look at various financial aspects of your business.

Create or Convert Quotes

With Xero, you can now create a quote and convert it to invoice bills or purchase orders. You can also duplicate past invoices to save time and add internal notes. Xero will use the same template for a quote that it uses to create your template.

Creating Financial Reports

You will get numerous accounting reports production functionalities. There are 55 different report templates ranging from budgeting of your cash flow to sales and much more. You can even customize all your financial reports and save your favorite ones for quick access.

You can use the budget manager reports to create budgeting reports from 3, 6, 12, and 24 months. Moreover, Xero will allow you to run a quick summary of your budget reports to check if you are on the path to hitting your financial targets.

Creating Journals

If your business works with advisors, you can give them access to all your reports to create journals. Xero also comes with a feature to create recurring journals.

Contract Management Made Easy

Xero promises to offer an impeccable contact management feature to your organization. You can use it to add the basic contact details of each customer and supplier. Moreover, you can mention sales tax rates and discounts for each party.

Xero goes the extra mile to let you organize your contacts in smart lists and groups. You can use your smart lists for your marketing campaigns to target specific clients. For example, you can create a smart list of your most loyal customers or customers based on demographics such as age, location, profession, etc.

You can also utilize smart lists to send an invoice to the entire group in one go. The same features are available to manage your suppliers as well.

Default Email Templates

There are over eight built-in email templates with other custom templates to help you create an email for clients, customers, employees, and suppliers.

Efficient Expense Management

If you wish to connect your business bank account and credit card account to Xero, you can do so conveniently.  You can even manually import your bank statements into Xero's interface. Xero accounting software also allows you to categorize your business expenses and split financial transactions.

Xero's innovative categorization feature will remember the previous transaction categories used and automatically categories your future transactions saving you time. However, you will have to approve each transaction for each categorization.

Ease of Use

Xero comes with an attractive and modern user interface with very well-organized visibility. However, it does come with a steep learning curve, whether it is your first time as a business using its accounting software or you have been using other competitor solutions.

You will have to take your time to learn about all the features Xero accounting software has to offer. Once you know your way around it, things become relatively straightforward. The best part is the on-going support by Xero as there is a learning tutorial for every function to help you through each page as you open it.

In case you need more help, feel free to contact Xero's 24/7 online support. Xero gets lots of praise for being the most robust accounting software solution.

Fixed Assets Management

Xero allows you to manage all your fixed assets and set up an evaluation of depreciation by planning a regular schedule. You can also opt to run several built-in depreciation schedules based on a declining balance, fixed-rate, etc. Xero will also allow you to add fixed asset information such as serial numbers and warranty expiration dates.

Invoicing Made Easy

Xero will provide your business with a single invoice template. You can then create templates customized to your business needs. However, you can get more template designs to help you choose which one suits your needs better.

Xero also offers time-efficient features such as automatic invoice reminders, recurring invoices notifications, default payment setting, replication of previous and existing invoices, and bulk invoicing. Moreover, you will also get a Xero to Xero feature that allows you to easily send and receive invoices to and from other businesses using Xero.

You can also create credit notes conveniently and send your customers statements straight from Xero's invoicing screen. The customers will receive your estimate or invoices in PDF format as email attachments. Moreover, there are payment gateways available for invoices.

Inventory Management

Xero accounting software allows your business to add your products and services to it. You can even add specific items with their basic information. Xero will also allow you to add attachments to each item and create notes for internal use.

With Xero, you can now track your entire inventory and make required adjustments as and when required. Xero will help you keep track of your stock levels, the number of items required for each quote, and average buying costs.

Now there are no email reminders to notify for low stock. Why? Because Xero will not allow your tracked inventory items to fall below zero. This means you can be pro-active in maintaining an adequate inventory stock at all times.

Making Packing Slips

In case you are a business that requires packing slips on a frequent basis, Xero will allow you to download d a packing slip invoice template from their help center.

Managing Your Expense Claims

First and foremost, you must remember that the full expense claim management feature is only available with the Established Price Plan by Xero accounting software.

Yes, each price plan has an expense tracking feature, but the established price plan will give you access to additional expense management features. These include automatic receipt scanning, expense claims, the Xero Expenses app, and extra expense analytics.

Multiple File Formats Support

Xero offers multiple file-formats support, and you can import or export your financial files and reports in and out of the system. That said, importing a file into Xero can be a somewhat time-consuming and cumbersome affair. However, you will get a lot of step-by-step guidance from Xero and its online support portal.

Purchase Orders Management

You can create your purchase orders and convert them into invoices. Moreover, you can write delivery instructions and the expected time of delivery to each one of them. In case your supplier ships an order in parts, you can keep track of part supply and record how much you have received so far.

Portal for Your Clients

Xero now offers an excellent feature to cater to your clients known as "Client Portal." This portal allows your customers to view, print, and pay their invoices directly online via payment gateways. Moreover, potential clients and suppliers can also view, print, accept, decline, and even comment on the quotes you send them.

Projects Management

The project management feature comes with Xero's Established price plan only. This feature allows your business to do basic and project job costing. However, this is a recent feature appreciated by the existing organizations worldwide.

Now you can create projects, add time and expenses, monitor your budgets, and even create project invoices conveniently as they become due. Xero also offers a Xero Project and progress payment apps for this purpose.  

Reconciliation of Your Bank Accounts

Xero accounting software allows you to reconcile your bank accounts and run reconciliation reports.

Support for Multiple Currencies

Xero offers support for over 160 currencies. However, this feature is only available to the users of the Established price plan. All currency rates get an update direct from XE on an hourly basis, and you can get a customized report and run it in any currency of your choice.

Time Tracking

This is an added feature catering to the previously mentioned project management feature. Time tracking allows you to track all billing cycles related to each project. However, like project tracking and management, this feature is also available with Xero's Established price plan only.

Tracking Made Easy

With Xero accounting software, you can now set up two tracking categories. Moreover, you get 100 individual tracking options to choose from within each of the two categories. This will allow you to organize all your financial and business information and create detailed reports.

Some businesses even create categories based on departments, locations, manufacturing, and teams, etc.

Tax Management

Now you can use Xero accounting software as your default sales tax manager for your sales, purchase, and customers. Xero also supports combined and compound tax with a sales tax lookup feature to automatically calculate each contact's sales tax based on their location or state.

However, in order to gain access to employee-related tax support and forms, you will have to buy the additional payroll with Gusto as an add-on to your existing price plan. This is because Xero no longer offers payroll features as a part of any of its price plans.

View Your Sales Bills and Receipts in a Glance

Using your dashboard, you can view each bill by entering manually into it. In the sales overview, you can use the standard practices of data navigation and entry. There are four buttons on the top to open tools to create sales transactions, import sales invoices, send statements, and search for quotes and invoices.

The big buttons on the screen show you the total amount of voices in dollars in a draft form. These include invoices awaiting payment and approval and any overdue sales transactions.

You can also see all your quotes in a draft form in accepted, sent, and expired categories. The awaiting payment section under invoices will open a new window for you to display all related transactions in a table format.

You can toggle amongst various tabs via buttons on top of the page. Thanks to Xero for using effective navigation features throughout their site while providing you convenient access to data and links.

Your Sales in a Glance

Xero has recently included a detailed feature to give you an overview of all your sales with numerical charts and graphical representations. This will give you a chance to make informed decisions by looking at your entire sales cycle on a single screen.


Xero accounting software had been rapidly growing since its inception back in 2006. It is currently offering some of the best features, usability, and integration options to businesses worldwide, making Xero one of the best accounting software for small, medium, or large businesses.

Xero offers machine learning features in numerous arenas of their site, which is going to get smarter with time. Now that you know about Xero and all the features it has to offer to your business, it is time for you to decide which of the price plans are best for your organization's accounting needs.

Remember, Xero is currently offering a 50% discount with a 30-day trial before you commit to buy.