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Xero Pricing Packages: What’s Included in Its Low-Cost Plans?

How much does Xero cost per month?
Xero offers an affordable all-in-one accounting platform for small- and medium-sized businesses, as well as for freelance accountants, and bookkeepers. For $20 to $40 per month, you can get both the minimum requirements and advanced tools and features you need to run your business. Among these features are purchase orders, bills payment, inventory, payroll, multi-currency accounting, and more.

Managing your finances is one of the most time-consuming and arduous parts of operating a business. Regardless of the size, businesses deal with the same challenges in accounting finances. But one of the major differences between SMEs and large corporations is that the latter have the capability to invest in sophisticated accounting software solutions.

For small business owners, especially those who are still in the startup stage, it is a common practice to resort to traditional accounting practices to save costs. This practice, however, can actually lead to more problems, such as human errors. Fortunately, there are accounting tools available that are specifically designed for small businesses and one of them is Xero.

In this article, we will look into Xero pricing plans—the features included in each and for whom each plan is ideal.

Xero pricing packages

The COVID-19 crisis hit a number of industries hard and small businesses have suffered the worst from its impact. And although the business recovery process has already started, another set of new challenges await as small businesses adapt to the new normal. Among the major challenges are the adjustments in financial plans. For businesses that have to lay off or furlough employees and reduce operating hours during and after lockdowns, rearranging financial priorities is harder than ever.

Not all small businesses, however, have been negatively affected by the pandemic. According to the Alignable Recovery Projections Poll, SMBs and professionals in the finance, insurance, and real estate industries reported that their income levels have actually improved. As an example, finance professionals like accountants and payroll managers have made more during COVID-19 than before the pandemic.

Source: Alignable Recovery Projections Poll, 2021

The growth of businesses and freelancers in these industries amid a global crisis can be attributed to the rise in the demand for their services. According to a survey that looked into the impact of the pandemic on small businesses, owners and operators of SMBs in struggling industries need guidance when it comes to navigating through their finances. But aside from getting help from professionals, small businesses can also benefit from having the right accounting tools that fit their needs and their budget.

Overview of Xero Accounting Software

Xero dashboard

Xero is one of the leading cloud-based accounting solutions designed for SMBs as well as for accountants and bookkeepers. As an award-winning accounting platform, Xero combines functionality, usability, and budget-friendliness to accommodate the needs of small- and medium-sized enterprises, as well as independent professionals from the startup stage and as they grow.

A powerful accounting solution, Xero offers robust features that allow you to automate various tasks, such as invoicing, reconciling bank transactions, reporting, calculating sales tax on various transactions, and more. With Xero, you have your own accounts payable tools accessible from any device. Xero’s accounts payable feature not only gives you a detailed view of your upcoming bills but also helps you prioritize which bills should be paid first.

Xero also functions as an expense management solution to help you keep track of your or your employees’ expenses. The reimbursement process is made easier with the help of Xero’s powerful data capture feature that automatically extracts information from photos of receipts uploaded to the platform. All reimbursement claims can be easily approved from your end, thus making the process faster.

Beyond basic accounting functions, Xero also allows you to manage your inventory, as well as create and send purchase orders on the go. You can also create online quotes and estimates using existing templates or by customizing your own. Moreover, quotes that have been accepted and fulfilled can be converted into invoices, thus saving you time that you can use to focus on other urgent matters.

Other notable features include quick reconciliation of bank transactions, automatic sales tax computation based on the tax rates you added in the system, as well as being able to access accurate and detailed reports whenever you need them. Additionally, Xero supports more than 160 currencies that you have the option to automatically convert to your local currency based on up-to-date exchange rates.

Detailed Xero Review

Key Features of Xero

  • Pay bills
  • Claim expenses
  • Bank connections
  • Bank reconciliation
  • Accept payments
  • Send invoices
  • Track projects
  • Contacts and smart list
  • Capture data
  • Payroll
  • Cloud-based filing system
  • Reporting
  • Inventory management
  • Muli-currency payment
  • Purchase orders
  • Quotes
  • Sales tax
  • 24/7 online support

Xero Pricing Packages

1. Early Plan

The Early plan is Xero’s lowest-priced package at only $11 per month.

Who is this plan ideal for?

Xero’s Early plan is designed for small business startups, especially sole proprietors who are still new to using cloud-based accounting solutions. This plan is also ideal for freelance accountants and bookkeepers looking for a simple, easy-to-use, and robust platform for their services.

What’s included in Xero’s Early plan?

  • Send quotes
  • Send a maximum of 20 invoices
  • Enter 5 bills
  • Reconcile bank transactions
  • Capture bills and receipts with Hubdoc
  • Payment service integration
  • 24/7 online support

Essential accounting features

Included in this plan are some of the basic accounting features, such as creating and sending quotes. Sending invoices is also included but limited to a maximum of 20 invoices directly from your mobile device. With the Starter plan, you can also enter up to five bills that you can pay by schedule or by batch.

Hubdoc integration

Another essential feature included in this plan is the app’s capability to capture bills and receipts using Hubdoc, Xero’s data capture tool. The purpose of Hubdoc is to reduce the manual data entry process by capturing all necessary information from bills and receipts and extracting and publishing all data in the Xero platform. With digital copies on hand, it is easier to manage bills and financial statements and organize them by folders and by using tags. All captured documents are also automatically kept in cloud storage and file sharing systems like Dropbox.

Xero receipts and bills

Receipts and bills can be uploaded to the Xero platform by taking photos or scanning them.

Daily bank reconciliation

With Xero, you can enjoy the convenience of having your bank transactions automatically fed into your Xero account on a daily basis. By simply connecting your Xero account to your bank account, all bank data will flow automatically to your Xero platform. Additionally, all data from your bank transactions that have been transferred to Xero are ready to be reconciled with receipts, bills, and invoices.

Moreover, you can set rules to categorize every transaction and match them with each receipt, bill, or invoice. In this way, you no longer have to manually check every transaction and match them with bill payments. Xero’s bank reconciliation feature also helps detect if there are deleted, duplicated, and missing transactions by simply running a bank reconciliation summary report.

Payment service integration

For added convenience, you have the option to add a payment gateway provider of your choice from the list of available apps in the marketplace, such as Paypal, Stripe, Zapier, Debtor Daddy, and more.

2. Growing Plan

In this section, let us examine the features included in Xero’s most popular package—the Standard plan priced at $32 per month.

Who is this plan ideal for?

The Standard plan is ideal for small businesses that have gone past the startup stage of establishing their business and are now in the process of scaling up.

What’s included in Xero’s Growing plan?

  • All features included in the Early plan
  • Unlimited invoices
  • Unlimited bills

Unlimited invoices and bills

Although the Early and Growing plans essentially have the same features, the difference lies in the Standard plan’s capability to create and send an unlimited number of invoices. With the Growing plan, you can also keep track of an unlimited number of bills that you can access and pay from anywhere using any device.

Xero invoicing

You can easily create online invoices using Xero’s invoicing feature. Invoices can also be converted from the quotes you created for a particular job or project.

3. Established Plan

At $62 a month, this plan gives you access to Xero’s more premium features.

Who is this plan ideal for?

This plan is good for businesses of any size that already have an established foundation, especially those that handle international transactions

What’s included in Xero’s Established plan?

  • All features included in the Early plan
  • Multiple currencies
  • Track projects
  • Claim expenses

Multiple currencies

Xero’s Established plan allows you to send and receive payments, as well as view reports in more than 160 currencies. International transactions can also be automatically converted based on the latest exchange rates, thus allowing you to see the impact of currency markets on your profit and cash flow.

Tracking projects

This feature provides you with essential project management tools. It allows you to estimate and prepare quotes that you can convert into digital invoices. Monitoring the time and cost spent on jobs or projects is also made easier using the built-in timer and location-based tracking on the Xero app. Additionally, you can also keep track of your projects’ or jobs’ profit margins to avoid unnecessary overspending and losses.

Simplified expense tracking

With this feature, you can monitor your employees’ spending with ease and reimburse their expenses without delay. All your employees have to do is submit a photo of their bills or receipts to the Xero platform, so you can review and approve the claims as soon as possible. Once approved, your employees can claim their expenses right away.

Xero expense accounts

You can manage the users who can access your expenses accounts by setting up user roles.

Which Xero plan is best for you?

Choosing among the Xero pricing plans all depends on the stage your business is currently in and your immediate plans. Are you just starting, in the process of expanding, or already established and leaning toward dealing with international clients and/or suppliers? Knowing and understanding your business’s current state and immediate plans is important as each package is designed with a specific business stage in mind.

Also, if you are already looking into a plan but feel like the features included are not quite enough, you can always check out the app marketplace. For an additional cost, you can create a Xero platform tailored to your business needs by adding a Xero product or a third-party solution.

Finally, keep in mind that like most cloud solutions these days, accounting software is subject to constant input from different industries and international regulations. To keep up with these developments, it is vital to keep abreast of accounting trends.

Meanwhile, accounting statistics should inform you of the most relevant numbers pertaining to the industry, as well as the various ways industries approach their financial needs.

Jenny Chang

By Jenny Chang

Jenny Chang is a senior writer specializing in SaaS and B2B software solutions. Her decision to focus on these two industries was spurred by their explosive growth in the last decade, much of it she attributes to the emergence of disruptive technologies and the quick adoption by businesses that were quick to recognize their values to their organizations. She has covered all the major developments in SaaS and B2B software solutions, from the introduction of massive ERPs to small business platforms to help startups on their way to success.

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