Cloud accounting software for small businesses. It connects to bank accounts, categorises transactions and produces the reports a business needs, with automation reducing the manual entry that used to dominate bookkeeping. Xero publishes per-month plans, so the cost is visible rather than quoted. The automation is real and bounded: it categorises and reconciles the routine, and anything unusual still needs a person. That is the correct division of work rather than a limitation to route around, and it is why the accountant does not disappear from the process.

Frequently asked questions

What is Xero?

Cloud accounting software for small businesses. It connects to bank feeds, automates transaction categorisation and produces reports, with accountant and bookkeeper access built in.

Who is it for?

Small businesses, and the accountants and bookkeepers who work with them. In practice the choice is often made together with your accountant rather than alone.

Is Xero free?

No, it is a paid subscription, though a trial is offered. Plans are published per month and differ by features and transaction volume, so check the current figures on the vendor site.

What should you check before switching?

Whether your accountant works with it. Accounting software is a shared system, and moving to one your accountant does not use shifts work onto you rather than away from you.

Can I migrate from another package?

Yes, and it is a migration rather than a switch: historical data has to be brought across correctly. Your accountant normally handles that, which is another reason to involve them in the decision.

What does the automation not do?

It does not decide how a transaction should be treated when the treatment is a judgement call, and it does not replace reconciliation review. It removes the typing, not the accounting, which is why an accountant remains part of the process rather than being replaced by it.

What it is good at

Keeping the books current

A bank feed and automatic categorisation reduce the backlog that builds when entries are done monthly by hand.

Invoicing and getting paid

Raising invoices and tracking what is outstanding is the day-to-day task it handles.

Giving an accountant access

Shared access is why the choice is usually made with your accountant rather than independently.

Pricing

Xero is a paid subscription with published per-month plans that differ by features and volume, plus a trial. Confirm the current figures on the vendor site, and check which plan your accountant recommends.

Alternatives

QuickBooks — The main comparable package, with a different accountant network.
FreeAgent — Accounting aimed at freelancers and very small businesses.
A spreadsheet — Free, and it stops coping once VAT or payroll is involved.

What to check before you commit

Ask your accountant first

They will be working in it too. A package they do not use creates work rather than removing it.

Compare plans by volume

The tiers differ by transaction count. Pick the tier matching your actual bookkeeping, not the cheapest one.