How to use Xero for the first time – A beginners’ guide

Kirsty Young Business Tips

Getting to know a new piece of software can be a daunting task.

So, here’s some directions on what you should look at when you use accounting app Xero for the first time.

This isn’t intended to be an in-depth Xero guide. It’s more of a signpost to things you should look at, as you start getting to know this popular accounts app.

 

Connect your bank to Xero

Arguably the best feature of Xero is the way it handles your bank transactions. You can connect the vast majority of UK banks so that you automatically get a ‘feed’ each day of your bank transactions. No need to log into your bank and export transactions – the app does it all for you.

The second-best feature is that Xero “learns” what you do with your transactions.

  • You will inevitably spend a lot of the time using the app on the bank ‘reconcile’ screen. That’s fine. You’ll be telling Xero what your various transactions are.
  • As you do so, Xero learns what you normally do with transactions. So, if it sees a similar one in the future, the app will suggest where you might want to allocate it.

It’s critical to connect your bank to the software correctly. You can see details on how to do this here.

One you’ve done this, check out how to add your expenses/bills to. Then you can have a practice go ‘reconciling’ some transactions.

 

How to add or update your business details in Xero

To use some of the other Xero features, you need to have your business details the system,

Including:

  • Your business name
  • Business address
  • Contact numbers
  • VAT number (if you have one)

To do this, visit the organisational settings inside Xero. The easiest way to find these is to click on your business name in the top left corner and go to ‘Settings’ > ‘Organisation Details’.

Once in Organisation Details, you can fill in the boxes with your details

 

Get ready to send your invoices

Another great key feature of Xero is that you can invoice your customers/clients directly from the software. This can save you hours of time. If you are in a business that isn’t issuing invoices, you may want to skip this step (although we find at some point most businesses end up wanting to do this).

There are a few ways to find the invoicing section screen. The easiest way to do this is to click on your business name in the top left corner and go to ‘Settings’ > ‘Invoice Settings’

The quickest way to get going and create your first invoice in Xero is to edit the ‘standard’ template.

You can see details on how to set this up here.

 

Test out how to add costs (bills)

There are a few ways of dealing with getting your costs into Xero, and one of them is to add them as ‘bills’.

Add a bill by clicking the ‘+’ symbol in the top right corner, and completing the form.

Add a digital copy of the bill (if you have one) into Xero by dragging it onto the form.

There’s a big benefit to adding bills into Xero. When you go to deal with your bank transactions, Xero will usually be able to suggest ‘paying off’ this bill when it sees you have a bank transaction for the same amount as the bill. Clever, eh!

Xero does this by colouring the part of the screen green and displaying an ‘OK’ button. When you click OK, it pays the bill off and ‘reconciles (deals with) the bank transaction in one go.

 

Explore how to find stuff in Xero

There are a lot of ways to find transactions, almost too many! If you get stuck, the first thing to try is clicking the magnifying glass in the top right corner. Then type in the name of the supplier or customer you are looking for.

If for some reason you can’t see the magnifying glass in the top right, click ‘Dashboard’ and you should then see it (some screens don’t have this).

 

Look for further help

This is just the start of your journey with Xero towards more efficient and easier accounting.

If you need more detailed help, your first stop is the Xero Central Help Centre. You can access this from inside the software by clicking on the little ‘?’ symbol in the top right.

 

Want help from a human who really gets this stuff?

If you don’t have an accountant and/or want to make the most of Xero software, we’d love a chat. We offer a paid 1 hour, 1-2-1 consultation so you can ask simple questions of a bookkeeper and get the specific help you need. You don’t have to be a client, so it’s a great way for you to get the help, when you need it.