For Aussie startups, sole traders, and small business owners, managing money well from the start is key to thriving. Xero accounting software is popular for new businesses because it’s simple, cloud-based, and integrates with hundreds of apps, making it ideal for small business accounting and streamlining processes. Choosing the right plan for your accounting needs is crucial to maximize Xero’s benefits, especially for growing businesses.
Many founders only scratch the surface of Xero’s capabilities. Learning a few clever tips can save hours, keep your accounting data accurate, and provide real-time financial insights—all while ensuring strong data security.
Key Takeaways
Xero accounting streamlines financial admin and cash flow for Australian startups.
Automated bank rules speed up bank reconciliation.
Hubdoc simplifies expense tracking and supplier bills.
Custom dashboards provide quick financial reports.
Smart invoices with automatic reminders reduce late payments.
Tracking categories enable detailed reporting.
Xero app store adds payroll, inventory, and CRM integrations.
Built-in calculator speeds up data entry.
Record personal expenses via bills to keep accounts accurate.
Manage multiple Xero organizations with browser tabs.
Xero ensures strong data security and compliance.
Introduction: Why Xero is the Smart Choice for Australian Startups
When you’re running a startup or small business in Australia, having the right accounting software makes all the difference. Xero is a cloud-based solution designed to help small businesses manage financial data, cash flow, and data entry easily. It handles invoicing, expense tracking, bank reconciliation, and supplier bills—all in just a few clicks.
Xero integrates with hundreds of apps through the Xero app store, simplifying your accounting processes. Whether you need to accept payments or track expenses, Xero’s intuitive platform keeps your business running smoothly. For Australian startups looking to save time and reduce admin, Xero is the smart choice for managing finances and bookkeeping services.
Here’s a rundown of seven powerful Xero hacks every Australian startup should get familiar with:-
1. Automate Bank Rules for Faster Bank Account Reconciliation
Many founders only scratch the surface of Xero’s capabilities. Learning a few clever tips can save hours, keep your accounting data accurate, and provide real-time financial insights—all while ensuring strong data security.
How to set it up
Make sure your business bank accounts are properly connected to your Xero account before setting up bank rules.
Head to the Accounting Menu > Banking > Bank rules in Xero.
Create a rule for recurring payments like rent, insurance, or subscriptions.
Set the conditions (like description or amount).
Pick the right account code.
Once you’ve saved these rules, Xero will match new transactions automatically. If your startup deals with lots of transactions, this can cut reconciliation time by up to 80%.
Need a hand setting this up? Smart Digits can help automate your workflows and keep everything accurate.
2. Use Hubdoc or Dext for Easy Expense Tracking and Capturing Supplier Bills
Paper receipts can easily get lost, and typing everything in manually is a drag. Hubdoc (included with many standard and premium subscriptions) or Dext lets you snap photos of receipts or email invoices straight into Xero. They extract the key info automatically.
Why it’s great
No more piles of paper.
Fewer GST coding mistakes thanks to correct tax rates applied automatically.
Real-time visibility to track expenses.
If you’re always on the move, this is one of the quickest wins you can make.
3. Make Your Dashboard Work for You with Financial Reports at Just a Few Clicks
Xero’s dashboard isn’t just a pretty homepage – it’s your command centre. You can rearrange widgets to focus on what matters most:
Bank balances
Outstanding invoices and bills
Cash flow charts
Expense categories
Set it up so you get a clear snapshot of your cash situation at a glance, helping you make quick, informed decisions.
4. Create Smart Invoice Templates with Automatic Invoice Reminders and Accept Payments Online
Getting paid faster starts with professional invoices that reflect your brand. Xero lets you:
Add your logo and brand colours
Set custom payment terms
Send automatic reminders to reduce late payments and help with chasing payments
Include online payment options like Stripe, PayPal, or PayTo to accept payments easily
Quick tips:
Use different “invoice branding themes” for various services or customer groups.
Personalize tax settings by setting specific tax rates for individual customers to streamline billing and reduce errors.
Set automatic reminders for 7 and 14 days past due.
Enable payment gateways so clients can pay straight away.
Smart Digits’ Xero pros and accountants can help you design invoice templates that fit your brand perfectly.
5. Use Tracking Categories for Clearer Reporting of Key Features and Expense Tracking
Want to see how different projects, locations, or teams are performing? Xero’s “tracking categories” let you tag transactions with up to two custom labels (like Department = Sales or Region = NSW).
Tracking helps you:
Analyse profit by product line or branch
Spot underperforming areas early
Present neat reports to investors or lenders
This feature is especially handy if your startup has multiple revenue streams.
6. Add Apps from the Xero App Store to Boost Your Xero Experience
Xero’s ecosystem has hundreds of apps for payroll, inventory, CRM, and reporting. Popular choices for Aussie startups include:
Fathom – advanced KPI and cash flow insights
Deputy – staff scheduling and timesheets. Deputy also manages payroll tasks such as generating payslips, tracking leave, and calculating taxes.
Shopify – sync your eCommerce sales
Square – streamline point-of-sale data
Float – real-time cash flow forecasting
Before adding apps, check reviews and make sure they comply with STP or GST rules if they handle payroll or tax info.
7. Schedule Financial Reports and Set Invoice Reminders to Stay on Top
Instead of running reports manually every month, Xero lets you schedule them:
Profit & Loss
Balance Sheet
GST Reconciliation
Aged Receivables/Payables
You can also set up invoice reminders and alerts for overdue invoices or low bank balances, so you’re always ahead of the game.
Bonus: Use the Built In Calculator and Manual Journals to Save Time
Xero has a handy inbuilt calculator right inside the quantity and amount fields on invoices, quotes, bills, and manual journals. This inbuilt calculator is integrated into these transaction fields, simplifying and speeding up calculations so you can do quick math without leaving the page.
Why it’s useful
Perform calculations like addition, subtraction, multiplication, and division on the fly.
Avoid switching between apps or devices for simple math.
Save precious time during data entry and reduce human errors.
Just type your formula (e.g., 5*12) directly into the field and press enter to get the result.
8. Use Bill to Record Personal Expenses
If you’ve paid for a business expense out of your personal account and don’t need reimbursement, you can still record it in Xero easily.
How to do it
Create a bill for the expense.
Approve the bill.
When making a payment, select “Funds Introduced” as the payment account.
If you don’t see this account, you can enable it in the general ledger settings.
This keeps your accounting data accurate and helps separate personal and business finances clearly by managing transactions between two accounts properly.
9. View Multiple Pages and Manage Multiple Xero Organizations with Just a Few Clicks
Managing multiple Xero organizations? You can open different pages or organizations in separate browser tabs or windows.
Tips
On a PC, right-click a link and select “Open in new tab.”
On a Mac, hold the Command key and click the link.
Use different browsers to log into separate Xero organizations simultaneously.
This saves time switching back and forth and helps keep your workflow smooth.
10. Use the File Library to Organize Important Documents
Keeping your important business documents organized is essential for smooth accounting and quick access when needed. Xero’s file library helps you manage all your files in one place, directly linked to your transactions.
Benefits of using the file library
Store supplier bills, contracts, and receipts securely
Attach documents directly to transactions for easy reference
Improve audit readiness with organized records
Access files anytime from anywhere through the cloud
11. Use the Demo Company for Practice and Master Key Features
Xero provides a free demo company loaded with sample data to explore features risk-free.
Why try it
Test workflows before applying them to your real data.
Train new team members without fear of mistakes.
Experiment with reports, invoices, and bank reconciliation in a safe environment.
Access it anytime from the Xero dashboard without impacting your live accounts.
12. The + Button Shortcut Key for Quick Data Entry
Xero’s handy “+” button lets you quickly create new invoices, bills, contacts, or bank transactions from anywhere in the app.
How it helps
Speeds up data entry.
Keeps you focused by reducing clicks.
Great for busy days when you need to add multiple transactions fast.
Just click the “+” icon in the top menu and select what you want to create.
13. Use the Xero Mobile App to Manage Your Financial Data on the Go
Xero’s mobile app lets you manage your finances on the go, perfect for startups that need flexibility.
Features
Send invoices and quotes.
Capture receipts and bills with your phone camera.
Approve bills and reconcile bank transactions.
Check cash flow and account balances anytime, anywhere.
Download it on iOS or Android to keep your accounting moving with your business.
14. Sync with Google Sheets for Custom Reporting
For startups that love spreadsheets, syncing Xero data with Google Sheets can provide custom reporting and analysis.
How to do it
Use third-party apps or add-ons that connect Xero with Google Sheets.
Automatically pull financial reports, invoices, or transaction data into your sheets.
Create dashboards or perform deeper data analysis tailored to your needs.
This seamless integration saves manual data entry and keeps your financial data up to date.
15. Use Split Screen Functionality for Better Workflow
Boost productivity by using split screen on your computer to view Xero alongside other important apps or documents.
Benefits
Compare invoices or reports side by side.
Copy data between Xero and spreadsheets or emails without switching windows.
Keep bank statements open while reconciling in Xero.
This simple hack helps save time and reduces errors when juggling multiple tasks.
Xero Security and Compliance: Keeping Your Startup’s Data Safe
When it comes to managing your business’s financial data, security is non-negotiable. Xero offers advanced encryption, secure access controls, and regular audits to keep your information safe. It also complies with international data protection laws like GDPR, ensuring your business stays legally protected.To help you further safeguard your data, Xero provides practical tips and tricks—like using strong passwords, enabling two-factor authentication, and keeping your software updated. With Xero, you can focus on running your business, knowing your financial data is in safe hands.
Essential security features and compliance tips for Australian businesses
Australian businesses can take full advantage of Xero’s essential security features to protect their financial data and maintain compliance. Xero offers automatic reminders for password updates, ensuring your accounts stay secure, and granular access controls so you can manage exactly who can view or edit sensitive financial data. By setting up tracking categories, you can organize your financial data more effectively, while payment reminders and automatic reminders help reduce late payments and keep your cash flow steady.
For those on premium subscriptions, Xero provides even more advanced security options, such as detailed audit trails and enhanced access controls, giving your business an extra layer of protection. By following Xero’s best practices and leveraging these built-in features, small businesses can confidently manage their accounting data, knowing they’re meeting both security and compliance standards. With Xero, your business’s financial data is always protected, letting you focus on growth and success.
Putting It All Together
To make the most of Xero accounting, a startup can follow this streamlined workflow:
Quickly capture supplier bills and receipts using Hubdoc so you never lose important paperwork.
Set up bank rules to automatically match and organise your daily bank transactions, making bank reconciliation faster and easier.
Personalize your dashboard to see important financial reports and cash flow summaries with just a few clicks.
Create professional invoices with your logo, offer online payment options, and send automatic reminders to help get paid faster.
Use tracking categories to see how different projects, locations, or teams are performing financially.
Add useful apps like Fathom to get better insights into your cash flow and financial health.
Schedule financial reports to be sent automatically to keep you and your team updated.
Use Xero’s built-in calculator when entering numbers to save time and avoid mistakes.
Record business expenses you’ve paid from your personal account by creating bills and marking them as “Funds Introduced.”
Manage multiple Xero accounts easily by opening them in different browser tabs or using different browsers.
Keep all your important documents organised and easy to find using Xero’s file library.
Practice using Xero’s features risk-free with the demo company before working on your real data.
Speed up data entry by using the “+” button shortcut to quickly add new invoices, bills, or contacts.
Use the Xero mobile app to send invoices, track expenses, and reconcile bank transactions anytime, anywhere.
Connect Xero with tools like Google Sheets for customized reports and use split-screen on your computer to work efficiently between Xero and other apps.
By combining these hacks, startups can transform their accounting processes from a tedious task into a strategic advantage, saving precious time and enabling smarter business decisions.
With this approach, bookkeeping becomes a strategic advantage, not a chore — truly a game changer for any new business.
Need help getting the most from Xero?
Contact Smart Digits today. Our Xero experts provide tailored support to optimize your accounting, customize your Xero file, automate workflows, and keep your books investor-ready. Whether starting out or scaling, we help you choose the right plan and integrate essential apps from the Xero app store. Save time, reduce errors, and gain clearer financial insights. Call us now at 03 7034 4675 to get started!
