Xero Accounting Review 2024

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Our Verdict

Create top-tier custom quotes and convert to invoices easily

Xero is incredibly useful when it comes to gathering insights about the overall financial performance of your business, as well as the profitability of each project you’re running.

That said, to get access to all the features and functionalities Xero offers, you’d have to opt for the most expensive pricing plan. While this is nothing new in the industry (or for SaaS in general), the issue is that both Early and Growing plans just don’t offer enough value for money, especially considering that there are platforms that let you handle invoicing and accounting for free, such as Wave.

With that in mind, Xero is best suited for growing companies who want to use it to handle virtually all aspects of their accounting, from invoicing and expense claims to managing contacts, handling taxes, and managing their inventory.


  • Intuitive and easy to get to grips with the platform
  • Lets you convert quotes into invoices in seconds
  • Features advanced inventory management capabilities
  • Effectively manage all your files and business-critical data
  • Excellent customer support with quick response time


  • The lower-priced plans are extremely restrictive
  • Payroll is a paid add-on and is handled by a different company

What is Xero?

Xero is cloud-based accounting software designed for small and growing businesses. It offers a range of accounting tasks, including invoicing, payroll, bank reconciliation, business snapshot, expense tracking, and financial reporting.

Xero accounting software enables real-time collaboration with accountants and integrates with various third-party applications. The automation features reduce manual data entry, enhancing accuracy and saving time for small business owners.

Xero Pricing & Plans

Xero lets you test the platform risk-free for an entire month, so you get a feel for the app and see first-hand whether it’s the right tool for your business.

That said, here’s a quick breakdown of the pricing plans:

Pricing Plan Early Growing Established
Cost/Month/User $15/month $45/month $78/month
Free Trial ✅ – 30-days ✅ – 30-days ✅ – 30-days
Users Unlimited Unlimited Unlimited
Bulk Reconcile Transactions
Multiple Currencies
Payroll Optional add-on (Payroll with Gusto) Optional add-on (Payroll with Gusto) Optional add-on (Payroll with Gusto)
Customer Support Email, phone Email, phone Email, phone
Early — Starts at $15/month

The early plan covers the bare minimum you’d expect out of an accounting software solution, such as create invoices, pay bills, bill reconciliation, and short-term cash flow projections. It also limits you to only 20 quotes and/or invoices per month and allows you to add a total of 5 bills to your account monthly.

This is really low value for money, especially considering that you don’t have access to any of the advanced features. This is likely a marketing strategy that would convince most users to opt for one of the higher-priced plans, as they’re much more cost-effective and remove any invoicing or bill entry limits.

Growing — Starts at $45/month

In addition to removing bill limitations and allowing unlimited invoices, the Growing plan only adds bulk bank reconciliation to the mix. You still won’t be able to claim expenses or use multiple currencies, so the only realistic option for the vast majority of companies is the most expensive pricing plan.

Established — Starts at $78/month

With the Established plan, you’ll have full access to Xero’s features. On top of what Early and Growing plans cover, this includes project tracking, advanced analytics, claiming expenses, multi-currency support, contact management, inventory tracking, and sales taxes.

What’s worth noting is that payroll isn’t a built-in feature of Xero but is rather provided through an optional add-on — Payroll with Gusto. This adds another $40/month plus $6/month per person to your monthly subscription bill, meaning Xero can get pretty expensive if you want to run payroll for a large team.

If you’re looking for better, more cost-effective options for handling payroll runs, read our best payroll software guide.

Xero Overview

Starting price $15/month
Best for Established businesses looking for a robust, feature-rich accounting solution
Customer support Email, phone
App integrations Deel, Rippling, HubSpot, Stripe, Zapier, Deputy
Security & Compliance ISO 27001, SOC 2 security assurance audits, multi-factor authentication (MFA), data encryption
Payroll Optional add-on
Reporting & analytics ✅ – Custom reporting
Mobile app ✅ – iOS and Android
Double entry
Auto-alerts and reminders

Xero Key Features

Xero is a feature-rich app, provided you’re willing to pay the premium price for the most expensive tier. It can help streamline and automate every financial aspect of your business, including invoicing, expenses, data capture, tax filing, bank reconciliation, and inventory management. You can even utilize it to manage fixed assets, depreciation, and disposal, which makes it a solid option for businesses with multiple locations in various industries.

Here’s a breakdown of Xero’s key features:

Quotes and InvoicingExpense ClaimsProject TrackingInventory ManagementAnalytics

Xero’s invoicing capabilities are top-notch. You can quickly create professional quotes and estimates and send them to your clients via the Xero desktop software or the mobile app. Using the app also makes it easy to track invoices and use the repeating invoices function. By using one of the templates we found this to be very quick and easy. You can also simply edit a previous quote and just change the amount, or client.

Xero also notifies you whenever a client accepts a quote and lets you convert quotes into invoices with a single click – you can also edit invoices.

Speaking of online invoicing, you can create and send fully customizable invoices, provide multiple payment options to customers, and set up automation reminders for late payments, so you don’t have to “chase” clients for outstanding invoices.

Xero’s expense management tools enable you to easily track and manage your spending, reimburse expense claims, scan receipts to add them to Xero effortlessly, and see exactly where your money is going with reports detailing each expense and individual item.

The project tracking tools available in Xero allow you to track the time and costs associated with each specific project, making it easy to plan, budget, and monitor the profitability of your projects. This also makes it easy to invoice project costs and track project financials, giving you much-needed insight into the financial health of your business and improving your cash flow.

Xero’s inventory management functionality helps you keep track of your stock levels, lets you easily populate invoices and purchase orders with the products you buy and sell, and gives you insight into your top-performing items so you can easily keep up with the demand.

The inventory management functionality also comes with built-in real-time alerts, ensuring that you never run out of stock.

The dashboards and custom reports available in Xero let you keep a finger on the pulse of your business by detailing your cash flow, allowing you to track all key financial metrics, and identify and compare trends for different timelines.

If you upgrade to Analytics Plus, you’ll also be able to leverage AI-powered predictions to further improve your cash flow, manage future business events with scenario planning, and gain even deeper insights into your financials and more customization options for your reports.

Xero Integrations

Xero integrates with a wide variety of third-party apps via its app store. You can find invoicing, time tracking, payroll, CRM, and other third-party tools and apps. Despite the name “store,” the integrations with third-party apps are free, but there are multiple paid Xero add-ons to choose from as well.

Some of the most popular integrations include apps like Deel, Invoice Away, Zapier, Stripe, Tradify, Rippling, and HubSpot CRM. There are hundreds of apps in Xero’s app store, so it’s easy to connect the accounting platform to your existing software stack. On the off-chance that an app you’re using isn’t supported, you can always leverage Zapier to build custom integrations, which is a huge plus.

Xero Alternatives

Xero QuickBooks Wave Zoho Books
Best for Established businesses looking for a robust, feature-rich accounting solution SMBs looking to automate invoicing, payroll, tax filing, and time tracking Small businesses with less than 10 employees SMBs that want to streamline and automate accounting processes
Starting Price From $15/month From $18/month Free Free
Free Trial 30 days 30 days Free Forever Free Forever Plan
Payroll Paid add-on Paid add-on Paid add-on
Reporting Custom reports Customizable professional reports Detailed financial reports Custom reports
Mobile App
Xero vs QuickBooks

Xero and QuickBooks are quite similar. The biggest difference between the two stems from their pricing plans. While QuickBooks offers better value on lower-priced plans, it comes with a catch — the platform puts a rather strict limit on the number of users you can add to your account. While smaller businesses can get by with just a single user plus an accountant, large enterprises will need more than five users, so they’ll likely have to pay extra for each user on top, per month.

Xero, on the other hand, lets you add an unlimited number of users, but it’s only worthwhile if you opt for the most expensive pricing plan from the get-go. Still, Xero ends up being a more cost-effective option for well-established businesses, especially those with multiple locations.

Read our QuickBooks review for a more in-depth comparison.

Xero vs Wave

Wave is a better option for small businesses, given that its invoicing and accounting functionalities are free. The caveat with this platform is that it charges you for each payment received, ranging from 1% to 2.9% + $0.6 per transaction, depending on the type. This makes it a super cost-effective option if you’re working with one or two clients who are receiving only a handful of monthly payments, but it ramps up quickly and gets extremely expensive if you work with dozens of different clients.

As such, Wave is only viable for companies that execute large-scale projects and receive a few monthly or annual payments. On the other hand, Xero is a much better option for well-established companies, especially in the retail industry, due to both its pricing structure and its excellent inventory management capabilities.

Find out more details in our Wave review.

Xero vs Zoho Books

Zoho Books is another accounting software with a free forever plan, making it an excellent choice for small businesses. Granted, the free plan is limited to 1,000 invoices managed per year, but it does cover all the accounting basics. The paid plans are expensive compared to the alternatives, but you get a ton of advanced functionalities, such as journal templates, custom reports, warehouse management, and integration with Shopify stores.

Xero has the upper hand on Zoho Books when it comes to project tracking and data capture/storage, but other than that, the two apps are quite similar. The deciding factor for your business should be the pricing, and possibly the limitations to the number of invoices and custom reports Zoho Books enforces on most pricing plans.

Read our in-depth Zoho Books review to learn more.

Xero Customer Reviews

The user reviews for Xero are mostly positive, with the app averaging 4.4/5 stars on all major review sites.

Xero is often regarded by users as one of the most user-friendly accounting software solutions, and is praised for its integration capabilities. Users also appreciate how easy it is to convert quotes into invoices and store and search critical business documents, as well as how easy it is to submit and review expenses. Another aspect customers love about Xero is its fast and knowledgeable customer support.

Excellent software, always listening to users experiences and keeping up to date with fintech developments. Xero supports small businesses at every step of the journey.

User review from Trustpilot.

As far as disadvantages go, users highlight that Xero has hiked up the prices in the past, the inability to attach PDF files to purchase orders, and the fact that payroll is a paid add-on that’s handled by Gusto (a separate company).

How to Set Up Xero - Quick Guide

Follow our easy-to-follow step-by-step guide on how to set up your Xero accounting system.

  1. Create an account and Set up your organization

    Sign up to Xero and choose a subscription plan that fits your business needs. Input your business details like name, address, and industry. Configure your financial settings, including your fiscal year and base currency.
    Create an account and Set up your organization
  2. Connect bank accounts

    Link your business bank accounts to Xero for automatic bank feeds. This allows real-time transaction updates and simplifies reconciliation.
    Connect bank accounts
  3. Customize chart of accounts

    Set up your chart of accounts tailored to your business structure. Import an existing chart or use Xero’s default template and modify it as needed.
  4. Enter opening balances

    Input the opening balances for your accounts as of the start date. This ensures your financial data is accurate from the beginning.
    Enter opening balances
  5. Invite users and set permissions

    Add team members and accountants, assigning appropriate permissions based on their roles. Remember that you only get unlimited users in the higher price-plans.

How We Review and Test Accounting Products

To provide our readers with accurate and well-informed recommendations, we test the most popular accounting products on the market to find the best options for you. Our methodology consists of the following criteria:

  • Features: We examine the features of each accounting software to determine what capabilities are offered- such as creating, editing, and deleting transactions.
  • Compliance: We evaluate accounting software based on whether it offers local compliance when it comes to payroll, taxes, documentation, and more.
  • Bank Reconciliation: We test the reconciliation process to ensure transactions match bank statements accurately.
  • Multi-Currency Support: We verify the accuracy of currency conversions and transactions in multi-currency environments.
  • User Experience: We get hands-on with each product and act as a new user, testing each platform to gain understanding if the platform is easy to use or not.
  • Reporting and Documentation: We verify the accuracy of financial reports generated by the software such as balance sheets and income statements.
  • Integrations: We evaluate the integrations of each piece of software to determine how well it fits in with other key pieces in a business’s software stack, and whether its functionality can be expanded as required.
  • Audit Trails: We ensure the software maintains comprehensive audit trails for tracking changes made to financial data.


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Aleksandar Stevanovic
Software Reviews Expert
Aleksandar Stevanovic
Software Reviews Expert

Aleksandar Stevanovic spent 10 years honing his craft as a freelance content writer. He has a degree in Economics, and extensive experience in software, crypto, and cybersecurity industries. He covers a multitude of topics, writing factual and informative articles, helping individuals better understand the intricacies of the online world. Over the last two years, his research focus shifted more towards tech and software content, as evidenced by his publications on CEX.IO, Business2Community, and Techopedia. He believes in simplifying complex topics and bringing them closer to like-minded individuals. His work is as detail-oriented as it is creative, and is designed to…