How to get the most out of Xero: a beginner’s guide

Post by Open Colleges on April 15th, 2021

Xero is one of the most popular cloud accounting software programs in the world. Globally, there are more than 2 million subscribers that use Xero.

Whether you’re launching your own business or work in financial services and want to expand your knowledge base, this article will take you through the first steps of using Xero for beginners.

10 simple steps to follow when you first start using Xero

Xero has been designed to be as user-friendly and intuitive as possible. This means it shouldn’t take you too long to learn the basics of Xero.

Here are a few simple steps you can follow to help get you started with Xero.

1. Watch the ‘Xero Dashboard’ video

One of the first things you can do when getting started with Xero is to watch this super handy ‘Xero Dashboard’ video. When you open up Xero, you can find the video in the top left-hand corner of the dashboard. This will give a simple tutorial on the Xero dashboard.

2. Set up your business details

Next, set up your business information and contact details.

This includes your business’s:

  • display name
  • legal / trading name
  • registration number
  • email
  • mailing address
  • physical address
  • phone and fax numbers
  • logo
  • website address.

There are also a few other sections you can fill out here, such as a description of your business and the type of business you have.

3. Set up your bank account details and financial settings

Set up your bank account details, which also include any credit card accounts or PayPal accounts. This will allow your bank activity to automatically feed into Xero, which means less stress and less work for you.

You’ll also need to set up your financial settings. Input your financial year end to ensure you have the right year-end for your reports (more on those later); and enter your sales tax/ VAT details as well.

4. Set up your chart of accounts

Xero’s chart of accounts is designed to be simple to use. You can add, customise, or delete these accounts as you need to. If you’re switching from another accounting software, you can import these details into Xero yourself or ask the advice of your Bookkeeper/Accountant.

5. Start adding users

Xero is designed to be safe and secure for your peace of mind. That’s why you’re in complete control of who has access to Xero. By adding users yourself (such as your Accountant or Bookkeeper), you can control who can access Xero and what they can and cannot view in Xero. You can choose to give your Accountant full access to Xero; but you may choose to give your sales staff access to invoices only.  

6. Set up payroll

Yes, Xero also does payroll, which means all your business financials are in the one place. Set up pay roll in Xero and you can easily monitor staff costs, among other things.

7. Add payment services

You can also link payment services to your Xero account, like PayPal, Stripe or Square. This makes it easier for customers to pay you.

8. Customise with apps from the marketplace

One of the best features about Xero is that you can customise your experience with a huge range of apps and add-ons from the Xero marketplace. There is a huge range of apps to choose from that all offer different functionalities, from cash flow forecasting to inventory management.

9. Customise your business’s branding

Not only can you customise your invoices and quotes with your own terms of payment, but you can also add your logo. You can actually download templates from Xero, and then customise them further according to your needs.

10. Start getting familiar with reports   

There is a huge range of read-made reports you can run through Xero that can help you stay on top your business. But you also have the ability to customise these reports to better suit your needs. So it’s worthwhile getting your head around Xero reporting early on so you can make the most of this function..

Is Xero a good choice for small businesses?

Xero is very easy to use, which is what makes it such a great choice for small businesses and sole traders. But it’s also been designed to be as flexible as possible, which means Xero grows along with your business. Sure, you may be a small business owner with one or two employees in your team; but is the number of employers going to grow within the next year? Two years? Five years?

Xero offers three different subscription levels, so you can choose the plan that suits your needs and budget. You may begin with the Starter package, but as your business changes, you may find that you need to upgrade to the Standard or the Premium package.

How can I use Xero payroll for my business?

Setting up payroll in Xero should be one of the first few things that you do once you’ve become familiar with the platform.

Did you know that Xero can be integrated with payroll partners like Deputy? This makes taking care of payroll straightforward and simple, which will keep everyone happy.

Your employees can also access payroll through the employee portal where they can lodge time sheets, view their payslips and income statements and apply for leave all in the same place.

Where can I learn more about using Xero?

OC now offers the Certificate in Xero. This specially developed course has been created by The Career Academy to provide you with an in-depth overview of this popular cloud accounting software.

Whether you’re a small business owner, sole trader or a finance professional, you can benefit from what this course has to offer.

Enrol today and discover how you can get the most out of Xero.

Accounting & finance General advice Tips & resources
Open Colleges
By Open Colleges