When you work in healthcare, your time is best spent where it matters most: caring for people. But for many healthcare practices, that mission is being held back by outdated systems, manual admin, and time-consuming compliance tasks.

Thankfully, automation is changing that.

From managing patient bookings and rostering staff to invoicing and reconciling payments, smart digital tools and software are giving healthcare providers the freedom to focus on delivering high-quality care while staying financially healthy and compliant at the same time.

Why automation is a game-changer for healthcare practices

For many healthcare practices, manual processes are a significant drain on time and resources. From booking appointments and managing patient records to handling billing and payroll, these tasks can divert valuable time away from what matters most: patient care. Automation helps by streamlining these repetitive tasks, reducing errors, and freeing up staff to focus on more impactful work.

Imagine a world where patient scheduling is seamless, billing is accurate and timely, and reports are generated with a few clicks. This isn’t a distant dream; it’s the reality that automation can bring to your healthcare practice now. 

By embracing technology, practices can improve operational efficiency, enhance the patient experience, and even boost their financial health.

Xero: The foundation for automated healthcare finance

At the heart of any efficient healthcare practice lies robust accounting software. Xero provides the ideal foundation for automating your financial processes. From managing invoices and expenses to reconciling bank accounts, Xero helps healthcare practices maintain accurate financial records with ease. This real-time view of your finances empowers you to make informed decisions and ensures your practice stays on a healthy financial footing.

But the real power of Xero for healthcare practices comes alive when you connect it with specialised apps. These integrations extend Xero’s capabilities, allowing for even greater automation across different aspects of practice management.

Take automation further with Xero-connected apps

To truly unlock the potential of automation in your healthcare practice, consider integrating with apps designed specifically for your industry.

Here are just three Xero-connected apps that can help you create a more efficient and patient-centric practice:

1. Deputy: Streamline team scheduling and time tracking

Deputy makes it easy for healthcare providers to schedule shifts, manage timesheets, and ensure team coverage, all while staying compliant with employment laws and award rates.

With Deputy, you can:

• create and publish rosters in minutes
• track employee hours with digital timesheets and mobile clock-ins
• automate award rate calculations and breaks
• integrate timesheets directly with Xero payroll

Whether you’re managing a small clinic or a large, multi-site practice, Deputy helps keep your workforce running smoothly, your staff engaged, and your payroll accurate.

2. ShiftCare: Streamlining NDIS and aged care management

ShiftCare is a purpose-built platform for disability and aged care providers that helps manage staff, client schedules, and compliance, all in one place.

With ShiftCare, you can:

• build rosters quickly, even for complex care shifts
• log staff hours and track travel in real time
• capture clinical notes and meet compliance requirements
• generate NDIS-ready invoices

The best part? ShiftCare integrates directly with Xero to automatically sync timesheets and invoices, making payroll and billing easier and more accurate.

3. Splose: Practice management for allied health and therapy teams

Splose is designed to support allied health professionals and therapists by simplifying their daily workflows. It brings together client records, appointment scheduling, treatment notes, and compliance features into one intuitive platform.

With Splose, you can:

• automate appointment bookings and reminders
• create and send invoices directly from client records
• track client funding and NDIS budgets
• sync invoices and payments to Xero for full visibility

This helps your team stay organised and focused on delivering great care while ensuring you never lose track of funding or follow-ups.

The future of healthcare is automated

Embracing automation isn’t just about adopting new technology; it’s about building a more resilient, efficient, and patient-focused healthcare practice. 

By using the power of Xero and its ecosystem of connected apps, your healthcare practice can reduce administrative burdens, improve financial accuracy, and ultimately, free up valuable time and resources to deliver better care. 

The future of healthcare is here, and it’s driven by smart automation.
Explore all healthcare apps and clinic management software available in the Xero App Store.

The post Better systems, better care: How automation is transforming the future of healthcare appeared first on Xero Blog.

Today, I’m excited to share the beta launch of our new navigation and homepage (previously called the dashboard) experience. This goes beyond a fresh new look and a change in name, it’s the new home of all your business key insights and actions. Built for you, with you, this beta is the next step towards a more intuitive and insights-rich Xero.

Our goal is simple: empower you to see your business’s true performance at a glance and tackle the most important tasks, quicker. That means more valuable time back for what matters most. And soon, we’ll begin testing this exciting new experience with a group of Xero customers who have joined the beta. 

I know that many of you will be curious about what’s ahead, so here’s your sneak peek of the new navigation and homepage experience.

Built with you, for you

Every time you log in, the Xero navigation and homepage are your gateway to managing your business, so we know how important it is that we get this right.  

That’s why we’re committed to building it with you, for you. We co-created this experience with almost 3,000 of you – small business owners, accountants and bookkeepers – across Australia, New Zealand, the United Kingdom and the United States. Your feedback, pain points, and desires shaped every single element, ensuring this new experience delivers what you need. 

And throughout this beta, we’ll keep asking for your input, keep refining, and keep building a Xero that truly works for you, your business and your future.

A closer look: More control, more clarity

So, what’s changing?

A simpler navigation

You told us you want to find what you’re looking for more easily, so we’ve simplified navigation labels and grouped tasks more intuitively. This means you can find what you’re looking for, faster, glide seamlessly between tasks, and ultimately unlock even more value from your Xero subscription. 

You said you wanted easier access to key resources from anywhere in Xero. The improved right-hand panel lets you search, see notifications, get help, take quick actions, and use JAX (your GenAI-powered business companion), saving you valuable time.

Stay tuned over the coming months as we reveal more about the capabilities the new navigation will unleash.

Your dynamic new homepage

The homepage is the central hub of your Xero experience. Now with even more insights, the homepage gives you a quick, comprehensive view of your business performance every time you log in, allowing you to identify and act on critical tasks faster.

You said you want the data and insights to make smarter business decisions. So, we’ve introduced several powerful new widgets and supercharged the widgets you know and love.

New widgets, including task list, recently paid invoices and net profit and loss, give you critical financial information, immediately visible and actionable from your homepage so you can manage your business more confidently. This means you can:

• Focus on your top priorities: The new task list helps you prioritise and take prompt action on things like outstanding invoices and bills.
• Quickly assess your cash flow: See recent payments at a glance to understand what money has just come in.
• Instantly grasp your financial health: Get an immediate overview of your net profit and loss without running a separate report.

With these key insights front and centre, you can make more timely and effective business choices, whether it’s managing expenses, chasing overdue payments, or planning for the future.

Plus, we’ve supercharged existing widgets, like the chart of accounts watchlist. It now shows more information to help you track against your monthly budget with precision.

And because every business is unique, you can customise your homepage to display the figures and insights most vital to you. This is just the beginning. 

What’s next

We’ve notified our beta participants by email today that they’ll have access to the new navigation and homepage beta from next week. Not in the beta? You’ll soon be able to get a further sneak peek via an interactive prototype on the new navigation and homepage webpage. And, if you’d like to be part of future betas to help shape the future of Xero together, consider joining our research panel to participate in surveys and studies and get exclusive access to new features and prototypes.

Over the coming months, we’ll collect feedback from our beta users to refine the experience. Once testing is complete, the new experience will gradually roll out to all of you. But our commitment to delivering you an improved Xero experience doesn’t stop there – we’ll continue to enhance and build with input from you, our community, ensuring Xero evolves with your business needs. 

I’m really excited about this change and the benefits for you and your business. We’ll be here to help you prepare for it before it begins to roll out later this year, and will support you every step of the way. You’ll even have a chance to test drive the new homepage before it launches, so you can understand the changes on your own time. 

We’re updating all our education materials, including YouTube videos and Xero Central articles. You’ll also have access to comprehensive guides (both written and video) and product demo videos to help you navigate these changes. And as always, our dedicated support team will be ready to assist with any tricky questions.

We’re incredibly excited to build the future of Xero together with you and we can’t wait for you to experience the new navigation and homepage. Keep an eye for more updates soon.

The post Get ready for a reimagined Xero appeared first on Xero Blog.

For small businesses, we know that efficient, accurate, and seamless workflows are non-negotiable — especially when it comes to making payments. After all, paying bills and managing cash flow are two crucial tasks, and when managed effectively hand-in-hand, small businesses thrive. But these tasks shouldn’t be a manual headache. 

We also know that more than 70% of US SMBs place a high importance on having their accounting and accounts payable software tightly integrated, but only a small minority actually have access to integrated accounting and accounts payable.

That’s why we’re incredibly excited to share that Xero today announced its plans to acquire Melio, a leading SMB bill pay platform designed specifically for small businesses, accountants and bookkeepers in the US. 

This acquisition is a game-changer and will allow us to deliver an even more powerful and seamless experience to current and future Xero US customers across accounting, invoicing, bill pay and more, in a single integrated platform. 

Why Melio is a perfect fit for Xero customers now and in the future

Today, Melio is already loved and used by Xero customers through the Xero App Store as an app partner. Why? Because it transforms accounts payable from a time-consuming, manual chore into a seamless process. 

Melio’s powerful platform makes payment workflows easy and flexible, offering a wide choice of payment methods to suit the individual needs of each business, all while helping their vendors to get paid faster. Plus, with Melio’s robust approval workflows, customers will have greater visibility and control over every payment being made, helping them and their accountant to better manage their cash flow — a payment solution truly tailored to each business’s unique needs.  

Longer term, we know that bringing together accounting and payments seamlessly into one platform is a critical need for our customers. So we’ll be working hard to embed Melio’s full functionality within Xero to provide a seamless and fully integrated payment solution for both new and existing customers across the US. This means customers will be able to pay their bills without leaving the Xero platform, reducing the time spent manually replicating payments through multiple solutions and lowering the risk of human error. 

This isn’t just convenient — it’s transformational. 

We also believe in giving our customers the freedom to choose the tools that work best for them, recognising that diverse needs often require a variety of solutions. 

For existing Melio customers, we’ll continue to invest in Melio’s payments product as a standalone offering too, leveraging Xero’s go-to-market expertise to build on the great service and powerful features customers rely on today. 

The same applies for our ecosystem partners! We’ll continue to support other payment providers on our platform, just as we always have. This is what our open platform is all about — providing customers with a choice so they can use the software that best meets their specific needs.

We are deeply driven by our purpose to make life better for small businesses, their advisors and communities around the world. We can’t wait to bring this exciting vision to life and deliver even more powerful, integrated payment solutions to our customers.

Sukhinder Singh Cassidy 

Xero CEO

The post Xero to acquire Melio: A payments game-changer for small businesses across the US appeared first on Xero Blog.

Earlier this year, we announced that Analytics powered by Syft, Xero’s new offering that integrates Syft’s small business features into Xero, was rolling out in early access to a select group of plans in the United States. 

After a very positive response from customers included in that preview, we’re continuing to build on our promise to empower small businesses and their advisors with the tools they need to make more informed business decisions by extending access to all US customers. 

And starting this week, small business customers and their advisors across Australia will also begin to gain early access to the financial clarity and actionable insights provided by Analytics powered by Syft. Customers in early access will be empowered to improve financial management, boost efficiencies, and ultimately save valuable time through Analytics powered by Syft’s visualisation and performance dashboard features. 

“I’m super excited about the integration of [Analytics powered by] Syft with Xero. This actually is going to present an incredible opportunity to unpack what’s happening in the business and to understand where you’re performing well and where you can do better. I’ve had a little bit of experience with Syft, and this integration with Xero is going to be a game changer.” – Australian small business customer.

Analytics powered by Syft transforms complex data into clear, actionable graphs and tables, and enables you to create interactive and customised dashboards – providing immediate oversight of key business trends such as your overall profitability and operating cash flow. All accessed right from within Xero!

Once you’ve been granted early access to Analytics powered by Syft, you’ll see a banner within your Xero dashboard. You’ll also be able to click through via the report centre; directly within the profit and loss (income statement) report; and through the business snapshot dashboard.

Don’t see any banners on your dashboard yet? Keep an eye out when logging in as the rollout is being staggered over the next few months, and we expect all qualified customers will have access by August.

What’s next for analytics at Xero?

This is just the beginning of the powerful insights to come. As we expand Analytics powered by Syft to more regions, we’ll also continue to add new features, including cash flow manager for a more detailed overview of cash flow position. We’re also working hard to further embed these features into Xero and deliver ongoing additional value to you as part of your existing subscription.

We’re also continually investing in Syft Analytics, our advanced product designed specially for accountants and bookkeepers, with new and enhanced features rolling out this year. These include improvements to our forecasting features, advanced reporting, and multi-entity consolidations. 

Syft Analytics is already used and loved as a standalone app by many partners that want to make advanced analytics a core part of their advisory offering. We’re looking forward to empowering advisors with the tools to deliver management reporting, consolidations, and forecasting services to clients.

This is just the next step towards a more insightful future for small businesses and their advisors, powered by Xero and Syft. Stay tuned for more exciting developments as we continue to invest in advanced analytics for the Xero community.

The post Unlock greater insights with Analytics powered by Syft: Now rolling out in early access to Australia appeared first on Xero Blog.

At Xero, our connection to the accounting and bookkeeping community is critical, and XPAC (the Xero Partner Advisory Council) plays a big part in that.

We’re excited to introduce the new Australian XPAC FY26–27 cohort: 14 partners from across the industry who will work closely with us over the next year, providing invaluable insights to help shape how we continue to support our partner community.

The role of XPAC and why it matters

XPAC brings together a dedicated group of accountants and bookkeepers who meet with the Xero team quarterly and stay in close contact throughout the year. They share what they’re seeing in the industry, including the challenges, opportunities, and tools that are helping firms succeed, along with honest feedback on how we can better support our partners and build a great product to help accountants, bookkeepers and small businesses.

These ongoing conversations help us test ideas, stay focused on what matters most, and make well informed decisions grounded in real-world experiences and insight.

A huge thank you to the XPAC AU FY24–25 team!

Our XPAC AU FY24–25 group has been instrumental in helping us move in the right direction over the past twelve months. 

Some members are returning as mentors for FY26–27, while others are concluding their time with XPAC. Together, their input has shaped important conversations, challenged our thinking, and made a real difference. So, on behalf of Xero and our entire community, we want to say a big and sincere thank you to: 

• Aly Garrett – All In Advisory
• Amar Latif – MAD Wealth
• Beau Gaudron – GrowthWise
• Cassandra Scott – Laurus Bookkeeping
• Grace Occleshaw – BYO Group
• Jarrod Morris – Bolden
• Jason Robinson – Future Advisory
• Michele Grisdale – Rainforest Bookkeeping
• Natalie Lennon – Two Sides Accounting
• Sarah Lawrance – Hot Toast
• Sarah Pilling – Bramble and Briar
• Zac Hayes – HA Accounting

Meet the new XPAC AU FY26–27 cohort

The new XPAC AU group includes seven returning mentors and seven new members, bringing a wide range of experience and perspectives across the accounting and bookkeeping industry. 

We’re looking forward to working with this group over the coming year, kicking off with our first quarterly meeting in July.

Returning mentors:

• Sarah Lawrance – Hot Toast
• Michele Grisdale – Rainforest Bookkeeping
• Beau Gaudron – GrowthWise
• Aly Garrett – All In Advisory
• Natalie Lennon – Two Sides Accounting
• Jason Robinson – Future Advisory
• Amar Latif – MAD Wealth

New members:

• Katie Williams – The Vault Bookkeeping
• Krishan Sharma – KNS Accountants & Business Advisors
• Martine Hoosen – Bookwiz
• Davie Mach – Box Advisory Services
• Shaun Stubley – Air Accounting
• Tracey Rubens – Bookkeeper Connect
• Rebecca Buchanan – Straight Up Bookkeeping

Thanks again to everyone who applied for XPAC, and to our partner community for continuing to share your feedback, ideas and perspectives with us. We’ll keep the updates coming as the new XPAC chapter gets underway.

The post Meet our new XPAC Australia FY26–27 team! appeared first on Xero Blog.

We’re fast approaching the 2025 Xero Asia Awards ceremony in August! With nominations closing on 20 June, it’s now or never if you’d like to submit your entry and be a part of this highly anticipated night.

What are the Xero Asia Awards? A Quick Recap

Every year, the Xero Asia Awards recognise the very best in our partner community across the region, honouring their efforts to drive digital accounting forward and enable SMEs across the region to thrive.

This year, we’ve evolved the award categories to reflect the diverse achievements within our Xero partner community: 

• Xero Partner of the Year: Recognising overall commitment and success in leading the way with Xero across Singapore, Malaysia, and the rest of Asia. 
• Emerging Partner of the Year: Spotlighting newer partners who have made exceptional progress in their first year with Xero. 
• Total Xero Award: Celebrating practices that have made Xero part of their business DNA, championing its use with clients and running their firm on Xero. 
• Digital Innovator of the Year: For practices that have revolutionised their operations, culture, and client services through digital innovation. 
• Advisory Partner of the Year: Recognising partners who have excelled in making a difference in their SME clients’ lives through advisory services. 
• e-Invoicing Champion of the Year: Celebrating partners in Singapore and Malaysia who have championed e-invoicing adoption and educated clients on its benefits. 

All nominations are to be submitted via a video no longer than three minutes. But it’s less about how professional the production is, and more about how authentically you tell your story. We want to hear all about the genuine impact you’ve made on your clients and their businesses. 

For more guidance on how to put your best foot forward for your video submission, check out our tips and tricks blog post here.

Beyond the trophy: Prestige, growth, morale and community

Winning a Xero Asia Award goes beyond just a single prestigious moment on stage – it’s a chance to elevate credibility, unlock growth opportunities, boost team morale, and be a part of a dynamic community of the best and brightest in the industry.

• Winning an award means you have Xero’s stamp of approval – which in turn leads to new opportunities for growth. A globally recognised brand known for our commitment to empowering small businesses around the world, Xero’s endorsement distinguishes you from your competitors and enhances your reputation. With your practice now recognised as a trailblazer in your category, you’re well-positioned to pursue new growth avenues and attract new clients.

• You’ll also get to amplify your brand with a Xero Asia Awards promotional pack full of assets you can add to your digital presence, as well as guidance from the Xero team on how to further promote your business.

• Crucially, these Awards boost team morale and help attract top talent. When applying for an award, you have the opportunity to reflect on the past twelve months and spotlight some of your business’ greatest wins during that time – as well as the people who’ve helped you achieve them. Winning an award is even more significant – a chance to foster pride and a positive work culture, which in turn serves as a powerful tool to build and keep a high-performing team.

• Finally, and perhaps most importantly, being an award finalist or winner means belonging to an exclusive community of top-tier Xero partners – the cream of the crop who are truly shaping the future of digital accounting in Asia. All finalists are invited to our exclusive Awards ceremony, a chance to meet like-minded passionate professionals, share insights, and build long-lasting partnerships.

We hope that, like us, you’re just as excited about this year’s Awards and what they can offer to your practice. We’re constantly in awe of everything our partners achieve – accomplishments that deserve to be seen and celebrated. If you’re ready to take the leap, click here to begin your Awards submission. The submission window closes on 20 June, and we can’t wait to hear from you!

The post Xero Asia Awards 2025: Beyond the trophy appeared first on Xero Blog.

The 2025 Financial Year is almost at an end, so there has never been a better time to prepare. A great first step on your EOFY preparation journey is to review your payroll finalisation. Getting a head start on your organisation’s payroll ensures your July is as easy as possible.

Not sure where to start? You’ve come to the right place. Whether this is your first payroll finalisation, or your hundredth, blast past your tax time stress by following our handy list of steps.

1. Review pay items and their settings

With Single Touch Payroll (STP), it is important that the correct reporting categories are used for your earnings, deduction and paid leave pay items. Allowance pay items also need to be assigned an appropriate reporting type.

Because these categories tell the ATO how to treat each type of payment you’re reporting through STP, it’s crucial that all the pay items used in the current financial year are correctly assigned.

For more details on reporting categories, take a look at our guide in Xero Central.

2. Check your employees’ records 

There are key compliance requirements within STP reporting that affect the way employees are set up in Xero.

In Xero Payroll, all active and terminated employees (who will be included in the STP finalisation for the financial year) will need an employment type, income type, and tax scale defined in their records.

Review your employees’ records to ensure they’re STP compliant. You can run the Employee Contact Details report to check for accuracy, keeping a close eye on things like date of birth, email address and postcode.

3. Post and file any pay runs for the 2024/2025 financial year

Any pay runs with a payment date in this financial year will need to be posted and filed before you complete this year’s payroll finalisation. If you have pay runs that need to be reported in the 2025 financial year, ensure the payment date set for the pay run is on or before 30 June 2025.

However, please note that there may be scenarios where your pay run status shows a filing error, rather than the successful ‘Filed’ status. If you see a ‘Filing Error’ status on a pay run, you will need to confirm if the error was fixed or still needs to be addressed. Generally, if the subsequent pay runs for your employees are successful, the filing error seen can be safely ignored. If you are unsure, you can use our handy guide on how to fix a filing error in STP.

4. Process any outstanding superannuation payments

To claim a deduction on superannuation accruals submitted via Auto Super for the current financial year, super batches should be approved no later than 2:00pm AEST, 20 June 2025. We recommend marking this date in your calendar so you don’t forget.

If you’re not registered for Auto Super, you still have time to take advantage of this time saving feature! Check out our support article on how to register for automatic superannuation payments. Alternatively, the payments can be made manually outside of Xero.

5. Reconcile your payroll accounts

After processing all pay runs for the financial year, it’s important to forensically check the accuracy of your reporting. One way to do this easily is by generating the Payroll Activity Summary report and comparing it with the General Ledger report. 

You can specify a custom date range in both reports to help find any discrepancies. For guidance on reviewing payroll transactions at EOFY, take a look at this support article in Xero Central.

If you come across any discrepancies in your payroll accounts, you can use the remove and redo feature to edit the transaction and allocate it to the correct accounts.

Troubleshooting tips

• If you have multiple payroll expense accounts for earnings or superannuation, be sure to add up the totals for each account when comparing them to the Payroll Activity Summary report.
• Use the Account Transactions report to identify any transactions that may have been incorrectly reconciled against your Expense Accounts.
• Check for any manual journals that may have impacted your totals by running the Journal report and clicking on Manual Journals.
• If you’re unable to locate a discrepancy, try running your reports using a smaller date range to narrow down the issue.
• If you started using Xero midway through the financial year, double-check that the employee opening balances match your organisation’s conversion balances to avoid any discrepancies.

6. Review the Payroll Activity Summary report against the Payment Summary Details report

Stay with us – you’re almost there. 

It can be easy to get the Payroll Activity Summary report and the Payment Summary Details report confused, so remember you’ll still need to compare this information if you’re completing an STP finalisation. You can run these two reports for a custom date range and make sure the information balances.

It’s important to note here that the Payroll Activity Summary report shows gross earnings, whereas the Payment Summary Details report shows taxable earnings.

If there are salary sacrifice or pre-tax deductions that have been processed during the financial year, they will need to be deducted from the gross wages that show in the Payroll Activity Summary report. The total should then match the Payment Summary Details report (note that this will only show truncated values – the cents will not show in this report).

7. Amend any pay run mistakes you found

If you found any pay runs with incorrect STP reporting or amounts, these can be corrected using an unscheduled pay run. Simply create the pay run for the required period and enter the adjustment you need. When an unscheduled pay run is posted and filed, it will update your employees year-to-date (YTD) amounts and notify the ATO of this change.

You will need to doublecheck the payment date of the unscheduled pay run falls within the correct financial year (for example, on or before 30 June 2025) to ensure it’s reported correctly and updates the correct YTD amounts.

8. Process STP finalisation

You made it! It’s now time to process your STP finalisation.

Take a look at these steps on how to finalise your payroll information with the ATO. There’s also an easy-to-follow checklist to make sure you don’t miss anything.

You’ll need to file at least one pay run before you’re able to complete the STP finalisation process. Your first submission will include all YTD payroll information that has been entered into Xero.

Keep these tips in mind to help you along the way:

• Information included in the STP finalisation will pre-populate based on the information processed in Xero Payroll – you’ll be able to see gross totals, taxes and super. You can also view and easily edit RFBA and RFBA-E (reportable fringe benefit amounts).
• If you need to report any leave paid out on termination as ‘Lump Sum A’ or ‘Lump Sum B,’ you can do this by processing an unscheduled pay run. For more information, read this article.
• If you have terminated any employees on or before 30 June 2025 who need fringe benefit tax (FBT) amounts reported, you can use the toggle Show terminated employees for RFBA at the bottom of the STP finalisation page.
• Any Employment Termination Payments (ETP) that have been processed can be shown by clicking View Report to see the STP YTD Summary.
• If you started using Xero part way through the financial year and need to report employee opening balances through STP, take a look at our support article on transferring payroll balances to Xero Payroll.
• Based on the ATO’s requirements, gross payments are reported as the pre-sacrificed amount. This means salary sacrificed amounts, such as pre-tax deductions and reportable employer super contributions (RESC), are included in gross payments.

Once you click the ‘Submit Finalisation’ button, you can rest easy knowing that your EOFY Payroll is complete for another year. Go take a break, you deserve it!

Looking ahead to FY26

Superannuation: Superannuation guarantee rate is increasing from 11.5 to 12 percent on 1 July 2025. Any employees with a superannuation line set up with a rate type of statutory rate will be automatically updated. If their rate type has been set up as Percentage of Earnings, you will need to ensure you edit this percentage manually.

These changes to income tax rates and thresholds will also be automatically applied in pay runs with a payment date of 1 July 2025.

Superannuation for Government-funded Paid Parental Leave: From 1 July 2025, super will be paid by the Government on its Paid Parental Leave scheme. Superannuation remains optional for employer-funded Paid Parental Leave.

Visit the ATO  website to learn more.

Tax Brackets: No changes – the next change will occur in FY27.

Tax Tables: Changes to study and training support loans weekly, fortnightly and monthly tax tables due to annual indexing and repayment income thresholds changes.

These changes apply to pay runs with a payment date on or after 1 July 2025. If pre-created pay runs have been created for after this date, please review to ensure the correct tax rates have been applied.

Lump Sum and Termination Payments: The $1,200 Lump Sum E threshold is removed. All back payments over 12 months old must now be reported as Lump Sum E, regardless of value. ETP caps and Lump Sum D thresholds have also increased.

If your organisation is impacted by changes to the minimum wage, you will need to update your employees’ pay templates. You can learn how to create or edit a pay template for an employee by checking our Xero Central article.

To find out if these changes could affect you, please refer to the Fair Work Ombudsman.

Looking for more information? Check out our EOFY Resource Hub for everything you need to know (and do) to round out FY25, and set up strong for the new year ahead.

The post Blast past tax time stress this EOFY: Steps to process and finalise payroll appeared first on Xero Blog.

From April 2026, small businesses, sole traders and landlords will need to change how they report income tax to HMRC. New legislation, known as Making Tax Digital for Income Tax (MTD for IT), is set to be introduced, sparking a shift in financial reporting requirements. 

To comply with MTD for IT requirements, businesses will need to do three things: send quarterly updates on business income and expenses, keep digital records, and submit returns annually using MTD-compatible software. The MTD for IT rollout will happen in phases. Anyone with an annual turnover of over £50,000 for the tax 24/25 year will need to start complying from April 2026. It will then extend to those earning over £30,000 from April 2027 and anyone earning over £20,000 from April 2028.

Master MTD for IT with confidence

MTD for IT will likely feel like a big change for many small businesses. Over two-fifths (42%) of the smallest businesses currently don’t use any finance or accounting tools, and just 27% believe they get their tech and software choices right. For many businesses, MTD for IT may mean investing in digital software or technology for the first time. Although the digital transition might feel daunting, Xero is here to support you. Our easy-to-use online accounting software will give you a clear picture of your finances so you’re more in control. With the right digital tools in place, and a streamlined process for how you manage and submit taxes, you can spend less time doing your taxes and more time on your business.

To help support you in complying with MTD for IT and to help you adopt good digital bookkeeping habits, we’ve added Xero Simple to the range of MTD-ready plans that are available directly to small businesses, sole traders and landlords. Like all our plans, it’s designed to give you confidence and support in mastering MTD for IT:

• HMRC recognised: Make secure online submissions to HMRC to comply with MTD for IT requirements using a platform trusted by millions
• End-to-end solution for total compliance: No need for multiple solutions; you’ll have access to everything you need  – from digital record-keeping right through to final submissions – with our cost-effective solution; you can even manage a property and business with one Xero subscription
• Do MTD for IT easier and faster: Make the transition smooth and hassle-free using automation and AI. Your bank transactions flow into Xero automatically and you can snap receipts and extract data on the go so you have more time to focus on your work
• Get expert support: With free guides, online courses, live webinars and unlimited free online support 24/7, you can get real human help, whenever you need it. 

We’re here to help you get ready

In a tough economic climate where many businesses are already juggling so much, thinking ahead about how you’ll manage the transition to MTD for IT will help. Start getting ready now and use the next 10 months to test out digital tools so you can get the hang of it in advance. It’s also a good idea to start building habits like capturing receipts instantly and doing daily reconciliation. Having a good bookkeeping routine where your data is up-to-date will set you up well for when the legislation comes into effect. 

If you’re unsure about where to start, your accountant or bookkeeper is an invaluable partner who can help you better understand the changing nature of reporting requirements and the best way to approach MTD for IT compliance. They’ll be able to cut through the jargon and advise what it means when the legislation comes into effect. 

We’re also here to help. Take a look at our range of MTD-for-IT–ready plans and the benefits they deliver, or sign-up for one of our free MTD for IT webinars. In these webinars, we’ll break down what MTD means for you, what you need to do, and show you our MTD solution in action.

For more information take a look at our MTD guide with advice on MTD for IT and insights that you can use to help you prepare.

The post Xero Simple is here for small businesses appeared first on Xero Blog.

If the thought of lodging your tax return makes your palms sweaty and you find yourself procrastinating to avoid the inevitable, you’re not alone. Xero’s latest research has found nearly three quarters of Australians are worried or anxious about tax time this year.¹

This end of financial year (EOFY), we wanted to uncover the universal challenges that Aussies face and common knowledge gaps when it comes to tax time, and provide easy-to-understand information to reduce confusion and anxiety at this time of year.

The ‘Xero Tax Confidence Index’ surveyed more than 1000 Australians – including small business owners – to gauge their confidence and knowledge levels around all things tax. We found 73% of Australians report feeling worried or stressed at EOFY, with most small business owners echoing this sentiment. More than half (54%) of Australians are worried about making an error on their tax return: key concerns included owing money to the Australian Taxation Office (33%), following tax rules correctly (28%), and being audited by the ATO (22%).

For Australia’s 2.6 million small business owners, tax season often adds pressure on top of managing day-to-day operations. In fact, Xero research from 2024 revealed 83% of small business leaders find EOFY overwhelming and 71% find it stressful.² 

There are no silly questions

One in five Australians say they have avoided asking tax-related questions because they were worried their question might seem silly or the answer obvious, and our small business research also shows one in three business leaders find tax preparation overwhelming.² But when it comes to tax and finances, there’s no such thing as a silly question! We want people to feel more comfortable, know they are not alone, and feel encouraged to reach out for help.

Tax deductions are a key area of confusion. While 58% of Australians made purchases last year with the intention of claiming them as tax deductions, 51% admitted to being confused about deduction rules. The biggest areas of confusion were car and travel expenses (21%) and working from home costs (21%). Half of those who made a purchase specifically for a tax deduction last year found it didn’t turn out how they wanted, with 21% discovering their purchase was ineligible to claim a deduction for, and 17% not getting the return they wanted.

Putting tax knowledge to the test

To further dig into Australians’ tax knowledge, we presented participants with true or false statements on common tax scenarios.

Finding the right support

Encouragingly, most Australians turn to trusted sources for tax guidance: the official ATO website (51%) and tax agents or accountants (40%) are the leading go-tos. Having the right support in place is critical for both taxpayers and small businesses alike. Not only does it provide confidence that they’re doing the right thing, it alleviates the stress and anxiety that can come with this time of year. Engaging a trusted advisor is invaluable; they’re the experts who can answer any question, no matter how silly it might seem, and guide you through the process. We know from our strong accounting partner community that they’d be happy to help, so the next time you have a question, don’t hesitate, ask your advisor.

Digital tools can also help ease the burden by automating some of the more complex or time-consuming tasks and keeping you organised, whether that’s simply capturing your expenses for claiming deductions, or more complex tasks for small businesses like managing records, financial statements and tax compliance.

For small businesses looking for information and support this tax time, in addition to speaking with your advisor, you can visit Xero’s EOFY resource hub for tools and resources to help you blast past tax-time stress.

About the research

¹  Xero’s Tax Confidence Index research was commissioned by Xero and conducted by Lonergan Research. Lonergan Research surveyed a nationally representative population of 1003 Australians aged 18+. After interviewing, data was weighted to the latest population estimates sourced from the Australian Bureau of Statistics. The survey was conducted online amongst members of an independent and permission-based panel, between 29 April 2025 and 5 May 2025. 
² Small business research was commissioned by Xero and conducted by YouGov. The total sample size was 1077 Australian adults, with 80% from NSW, VIC and QLD, who are small business owners and decision makers in businesses with fewer than 20 employees. Fieldwork was undertaken between 10 and 19 May 2024. The survey was carried out online.

The post Half of Australians fear making a mistake on their tax return this year appeared first on Xero Blog.

Late payments pose a significant hurdle for small businesses, frequently disrupting cash flow and complicating the management of daily operations. Recognising this challenge, we’re dedicated to helping you receive payments more efficiently by expanding your payment options.

Building on our existing support for credit cards, debit cards, Apple Pay, and Google Pay, we’re excited to announce the addition of Pay by Bank. Powered by Stripe, this new feature empowers your customers to make payments instantly from their bank accounts straight from their online invoice. By offering your customers a wider range of payment methods, you increase the likelihood of getting paid faster and spending less time chasing payments. Introducing these additional payment alternatives ensures your customers have every convenient opportunity to pay invoices quickly, making it a swift, secure, and cost-effective solution for everyone involved.

What is Pay by Bank?

Pay by Bank is a real-time payment method in the UK that enables you to collect one-time payments from your customers’ bank accounts quickly and securely, and at an affordable cost.  Consider it a modern alternative to traditional direct debits. This integrated digital payment solution allows customers to authorise and approve payments through their mobile banking app or online banking portal. Payment confirmations are immediate within your Stripe account, so you know the money is en route and can confidently manage your cash flow. Once a customer authorises a payment, the corresponding invoice is automatically marked as paid, simplifying bank reconciliation.    

We understand that chasing overdue payments consumes valuable time that could be better spent managing and growing your business. That’s why we’re investing in innovative solutions like Pay by Bank, alongside other payment methods, to help you receive timely payments with minimal effort. By offering your customers more convenient choices, we aim to accelerate invoice settlement, ultimately freeing you from unnecessary cash flow concerns.

Benefits of using Pay by Bank

Here are several advantages of using Pay by Bank for your small business:

• Quick and convenient for customers: Pay by Bank allows customers to authorise bank payments instantly and securely using their mobile banking app or online banking portal.  They simply select their bank, log in, and approve the payment.    
• Real-time payment visibility: When your customer makes a payment, the confirmation is visible in your Stripe account instantly, giving you assurance that your funds are on their way.  Typically, Stripe will settle these funds within two business days.    
• Affordable transaction fees: Pay by Bank facilitates fast and secure transactions with affordable  and, importantly, capped fees, so more money stays in your business.
• Automated processes: When your customer pays, the invoice is automatically marked as paid for both you and them.  Payment confirmations are instant in your Stripe account, and funds are settled automatically, making reconciliation a breeze.

How to use Pay by Bank in Xero

Pay by Bank is available with a Stripe account.  To activate it:   

• Go to your Dashboard, select Business, then Online Payments
• In the Manage payment methods tab, click “Turn On” next to Pay by Bank
• This will enable the feature for all future invoices and any unpaid invoices you’ve already sent

You have the option to enable or disable this setting as needed directly from your invoice.    

When your customer chooses to pay with Pay by Bank, they will follow these steps:

• On the online invoice, the customer selects Pay by Bank as their chosen payment method    
• The customer then selects their bank. It’s important to note that the customer must have a UK bank account with a supported bank to use Pay by Bank. To learn more about eligible banks, click here (Note: payments from non-UK bank accounts, even if the bank is listed, are not supported)
• The customer is then directed to their bank’s mobile app or online banking portal to authorise the payment
• Once the payment is authorised, the online invoice will be automatically marked as paid

Pay by Bank enhances Xero’s payment capabilities, providing your customers with more ways to pay, which helps you receive payments promptly and consistently.

Learn more about offering Pay by Bank here. 

The post Introducing Pay by Bank for UK Small businesses: More payment options, healthier cash flow appeared first on Xero Blog.

The 2025 Xero US Roadshow is set to deliver a day packed with innovation, networking, and inspiration. Let’s explore what’s on the agenda and why you should care.

Spotlighting Innovation: AI and Advisory Services
The accounting industry isn’t what it used to be; it’s smarter, faster, and more efficient, thanks to AI and advisory services. This year’s Roadshow is focusing on these game-changing tools and strategies. Expect insights from Xero’s team on product enhancements that will redefine your approach to accounting. From core accounting updates to streamlined bank feeds and bill payments, it’s about working smarter, not harder with Xero. 

AI: The Game-Changer in Accounting
Artificial intelligence isn’t just for tech giants anymore. At the Roadshow, see firsthand how AI can transform workflows, marketing strategies, and client interactions. Learn to leverage AI and app stacks to boost efficiency and capitalize on growth opportunities. This isn’t a glimpse into the future; it’s happening now, and it’s changing the game for accounting practices.

Advisory Services: Structuring for Success
Advisory services are essential for any accounting practice aiming to upsell and deliver real value to clients. The Roadshow will delve into practical frameworks for structuring, pricing, and delivering these high-value services. Here, you’ll get the tools needed to add genuine value to your clients.

Tailored Learning Tracks
Whether you’re a seasoned Xero partner or a newcomer curious about what’s possible, the Roadshow offers something for everyone:

• Existing partners: Dive into product innovations, AI integration, enhancing advisory services, and learn how to build powerful app stacks to streamline your workflow.
• Prospective partners: Find out how to start with Xero, expand your firm, establish a solid foundation using the right technology, leverage AI to market your practice, and confidently guide clients through change with practical transition strategies.

Networking and Growth Opportunities
It’s not just about what you know; it’s also about who you know. The Roadshow includes plenty of networking opportunities. Enjoy great food and drinks while building connections with Xero experts, app partners, and industry peers. Finish the day with a relaxed cocktail event to continue the conversations and celebrate new collaborations. 

Are You Ready to Lead in Accounting?
The 2025 Xero US Roadshow offers a chance to acquire new skills, future-proof your practice, and connect with a thriving community eager to grow. This isn’t just an event; it’s your gateway to innovative accounting.

For more details and to see the list of cities on the tour, click here.

In a few words—don’t miss it!

The post 2025 Xero US Roadshow: What You Need to Know appeared first on Xero Blog.

Finding tools to simplify your processes and save time is essential for a small business owner. But with so many apps available to connect to Xero, it can feel overwhelming to sort through them all. 

That’s why we’ve pulled together lists from the Xero App Store in Australia, the US and the UK where you can see the year’s most popular, most recommended, and award-winning apps to help you discover apps that are functional, trusted and loved by businesses and experts alike.

Most popular apps

 Our ‘Most popular apps of 2024’ lists highlight the top apps that Xero users connected to through the Xero App Store. Whether helping to automate tasks, manage inventory, or improve cash flow visibility, these apps are popular among small businesses like yours.

Check out the 2024 most popular app lists:

• Most popular apps 2024:  Australia
• Most popular apps 2024:  UK 
• Most popular apps 2024: US 

Most recommended apps

Our ‘Most recommended by advisors 2024’ lists contain apps trusted by the advisors who know small businesses best. These apps are the ones that accountants and bookkeepers recommended to their clients through the Xero App Store the most. 

Check out the most advisor-recommended app lists:

• Most recommended apps 2024: Australia
• Most recommended apps 2024: UK
• Most recommended apps 2024: US 

Award-winning apps

Finally, our ‘Xero Award-winning apps of 2024’ list showcases the apps that took home a prize from Xero App Awards across the globe this year. These apps were recognised at awards ceremonies in the UK, US, Canada, Asia and South Africa in 2024. 

Check out Xero award-winning apps

How can these apps help you?

Efficiency and simplicity are the cornerstones of a thriving small business. By tapping into these curated lists, you can quickly identify apps that can help you:

• Boost efficiency: Automate repetitive tasks like invoicing, payroll, and expense tracking so you can focus on growing your business.
• Improve accuracy: Apps that integrate directly with Xero help reduce double handling to make your financial data more reliable.
• Stay ahead: With award-winning and highly recommended tools at your fingertips, you’ll be well equipped to embrace new opportunities in 2025.

Make 2025 your most efficient year yet

The Xero App Store is more than just a marketplace: it’s a resource to help your business thrive. These lists put the power of community and expertise in your hands, connecting you to apps vetted by real Xero users and accounting professionals.

Ready to explore? Head to the Xero App Store and make 2025 the year you take your business to the next level with tools designed to support your success.

The post Explore the Xero App Store’s 2024 top apps appeared first on Xero Blog.

I remember watching Back to the Future as a kid and looking forward to the future it predicted. Flying cars! Hoverboards! But here we are, 10 years after the movie’s timeline, and I still need roads wherever I’m going.  

It turns out that predicting the future is hard. Really hard. Particularly when trying to do so on an accurate timeline.  But that doesn’t mean we can’t spot signals and patterns emerging today that hint at what’s to come. Looking for these can help us anticipate future scenarios that we can then choose to prepare for in the work we undertake today. 

I think movies can be a valuable resource here.  As John Egan, CEO of L’Atelier, once noted, the bigger challenge to prediction isn’t forecasting technological change, but understanding societal change. Films can often reflect the cultural pulse of their time while also playing with some of the deeper shifts in how we live, work, and connect. 

So, as small business owners look to 2025 and beyond, here are a few movies that I think are worth another look as sources of signals and scenarios of the future, both of which can lead us to ask some interesting questions as we make personal or business plans for the year(s) ahead.

Iron Man: Agentic AI

We can’t all be ‘genius, billionaire, playboy, philanthropist’ superheroes, I guess. Nor can we fly around in high-tech metal suits.  But the team behind the 2008 Marvel movie that introduced J.A.R.V.I.S – Iron Man’s smart and capable AI assistant – were definitely picking up on a signal about the increasing rate of computational power and the evolution of artificial intelligence.  

In 2025, we find ourselves on the verge of the next leap forward in this space: agentic AI. AI assistants like Microsoft’s Copilot, Google’s Gemini and Anthropic’s Claude will be able to take action on behalf of their user. So, for example, rather than just answering questions about our upcoming flight, virtual agents will be able to make changes to our bookings, order inventory for a retail business based on sales projections, or even see what we can see on a screen and move the mouse as we would move it to carry out a process.

What questions does this emerging capability pose to small business owners?  Well, how well do you know your processes? How well documented are they? How digital are they? How could they be scaled or sped up if you had smart agents working alongside you and your human staff? What would you do with the time saved? Could you provide more coverage of customer support queries at odd hours? Is there anything stopping you from rolling out a new product or service that could be resolved with a smart agent? 

Ready Player One: Augmented reality and virtual reality

The immersive virtual world of Ready Player One might still be a way off (as is the timeline of the movie), but the signals pointing to full-sensory virtual reality (VR) are emerging, with headsets like the Meta Quest and the Apple Vision Pro showing increasingly lifelike displays and spatial audio.  

More pronounced is the signal about the blending between physical and virtual worlds. When was the last time you checked the price of a product while standing in front of it in a physical store? Or helped your kids pay for a virtual item using real money? Both the Quest and Vision Pro allow for a mixed reality where virtual items appear overlaid on the physical world. And if you feel goofy wearing something like that, the Ray-Ban Meta smart glasses are showing how interacting with the physical and virtual world in real time can actually be stylish.

Whether it’s called the ‘metaverse’, ‘OASIS’, or something else, this future is emerging today. As a small business owner, it may be worthwhile asking: What’s the next evolution of my website? Does it need to promote more interactivity with my products? Do I have high enough resolution images and videos of my products to thrive in a high definition virtual environment? What changes do I need to make to my promotional content, considering it may be viewed by AI rather than humans (like Apple Intelligence reading your marketing emails, or an AI assistant answering questions about your product)? Could I train my staff (or customers) more effectively, or safely, in a virtual reality environment?  

Star Trek: Ambient compute conversational interfaces

Pushing the timeline even further out, we’ll really have to give Star Trek a lot more time – as in a century or two – to see how accurate its predictions about teleportation, replicators and holodecks really are. But the imaginations of the creative team behind both the TV series and the many movies were right to pick up on the signals about the access to, miniaturisation of, and embedding of computing capability. 

Think about those signals and how they are playing out in capabilities that small businesses can already use. Accessing incredible computing capability from a handheld device is available today. And the signal is only getting stronger as the capability and ubiquity of connectivity continues to develop apace with options like StarLink providing even remote locations with fast internet access.

Moreover, that interaction is increasingly moving beyond screens. Unlocks in natural language processing and the proliferation of smart speakers, smart watches, smart earphones and smart homes means the ability to have a conversation with your computer while your hands are full or while working on a job is definitely within reach.

What, then, are the questions worth asking as these signals of future capability only get stronger? Well, how many of your shop or stockroom processes could be further enhanced by not having to go back to the office laptop or your smartphone to note something, or check something, or start something? If someone is asking their smart assistant about a product or service that you offer, what can you do to be in the consideration set? Is there capability out there in the cloud that you aren’t making use of yet, but would give your business an advantage in the year ahead?  

What sci-fi films can teach us about technology in small business

While we may not have every sci-fi vision realised yet, the signals are clear: technology’s transformative power is here and now. Small businesses can use the signals of the future to prompt strategic questions of themselves in the present.

For example, we don’t yet have Tax Administration 3.0, where reporting, payments, and real-time compliance coincide with taxable events. Yet we are seeing faster digital payments, and automated e-invoicing. AI isn’t sentient, but it’s automating tasks, providing deep insights, and freeing up time for small business owners.

Just as sci-fi authors and filmmakers imagined futures based on the signals of their time, small businesses today can do the same. By understanding the underlying trends and possibilities, they can harness technology’s power to create their own success stories.

The post Signals of the future: What sci-fi movies can teach us about predicting the direction of technology in small business appeared first on Xero Blog.

As 2024 came to a close, Xero surveyed small business owners to find out how they were feeling, what was driving their positive or negative outlook, and how recent interest rate cuts had impacted their business.¹ As Xero’s economist, I’ve reviewed the results and dusted off my crystal ball to bring you my thoughts on what your business is likely to be facing in 2025 and how you can prepare. 

How are small businesses feeling as 2024 ends?

Almost three quarters (74%) of UK respondents said they were either still positive, more positive, or much more positive about their business than they were in the previous month. 

The top three reasons UK small businesses told us they are positive, or more positive, about the future is that they:

• have more work available (42%)
• are making more sales (33%)
• have seen an improvement in cash flow (24%) 

The first two sentiments likely reflect the fact that the UK economy overall has performed better in 2024 than in 2023, when it spent part of the second half of the year in recession. The reported improvement in cash flow is most likely due to the ongoing downward trend in inflation. This in turn makes it easier to manage costs and eases the squeeze on profits and cash flow.

A smaller group of UK businesses (26%) said that they felt negative, more negative, or much more negative about their business than the previous month. This group is finding that:

• it’s harder to find new customers (55%)
• existing customers are buying less (45%)
• price rises are affecting sales (29%) 

These challenges reflect that, while inflation is lower, prices are still higher than a few years ago. This means cost-of-living pressures have not gone away, leaving some potential customers still dealing with stretched budgets. 

What are the big macro trends in 2025 and how can you benefit from them?

Every year unexpected events happen, and it’s likely 2025 will be no different. Nevertheless, the macro trends that you, as a small business owner, accountant or bookkeeper, need to stay aware of can be grouped into three broad categories: government policies, central bank actions, and productivity. With the right strategy you can turn these big trends, over which small businesses have little control, to your advantage.

New UK government policies

Already, in the first six months of the Starmer government, there have been multiple new policies for small businesses to get across. This includes business rates, National Insurance changes and plans to tackle late payments. With the publication of the modern industrial strategy, and a small business strategy due to be released in the coming months, we’ll no doubt hear more details about the Government’s plans for small-business-related policy.

UK small businesses are also likely to be keeping a close eye on the new Trump administration in the US. At this stage, it’s unclear how much of the campaign platform will be implemented in the first year of the Trump presidency. But any increase in tariffs on UK goods has the potential to negatively impact UK small businesses that export to the US. 

What can you do: To take advantage of new opportunities from policy change, and limit any potential negative impact, you’ll need to work with your advisors to have a good understanding about how each new policy announcement specifically impacts your business, supply chain, staff, and customers. Don’t wait until the policy has been brought in to respond; plan ahead and work with trusted advisors. 

Cash flow should benefit from lower inflation and interest rates

Higher than normal inflation, and the accompanying higher interest rates, have been challenging for many small businesses over the last two-to-three years. These forces drove up costs, hurt customer spending, and squeezed profits and cash flow. A period of price stability and lower interest rates in 2025 should help ease any cash flow pressures you’ve been dealing with.

The Bank of England has begun its rate-cutting cycle; the question now is, how quickly will rates be cut and to what level? This matters to small businesses like yours directly, as it increases how much you can borrow and/or reduces the cost of repayments. It also benefits you indirectly, due to the impact on your customers’ budgets as they have a little more to spend in your business. 

What can you do: Over three quarters of UK small businesses (80%) say they are yet to see the recent cuts to official interest rates resulting in more sales. As time goes by, more interest rate cuts are likely, as long as inflation follows the path the Bank of England currently expects. This means customers should start to have a little more cash available to spend in your business. Make sure you’re ready to respond with sufficient stock, enough staff, and additional marketing capacity. 

Productivity and digitalisation

Like many advanced economies, the UK has struggled to achieve productivity growth in recent years. The Office of National Statistics estimates labour productivity fell 1.8% year-on-year in the September quarter 2024. This makes the task of getting inflation back under control even harder. It also means the post-pandemic economic recovery has been more difficult, and is at least partly why the UK economy hardly grew in 2023. Small businesses will need to focus on productivity boosting levers in 2025. 

What can you do: If you can boost your business productivity, then you’ll be able to do some combination of offering lower prices to customers, attracting more skilled staff through higher wages, or lifting the profitability of your business. Think about how you could use digital tools, including those powered by AI, to complete those low-value tasks that take time but don’t bring in sales. Review the processes your business uses to make sure you’re operating in the best way possible, not just a way you’ve always done something. Invest in your staff so that they can maximise the benefit of new technology or processes.  

Get more small business insights

If you’re interested in finding out more about how small businesses in the UK are performing, check out the Xero Small Business Insights for the UK.

1. All figures, unless otherwise stated, are from an online survey commissioned by Xero in November 2024. Responses are from small businesses in Australia (300), Canada (250), New Zealand (154), UK (600) and US (290) during November 2024. Options have been edited for readability ︎

The post What’s ahead for your business in 2025? appeared first on Xero Blog.

As 2024 came to a close, Xero surveyed small business owners to find out how they were feeling, what was driving their positive or negative outlook, and how recent interest rate cuts had impacted their business.¹ As Xero’s economist, I’ve reviewed the results and dusted off my crystal ball to bring you my thoughts on what your business is likely to be facing in 2025 and how you can prepare.

How are small businesses feeling as 2024 ends?

In Canada, 84% of respondents said they were either still positive, more positive, or much more positive about their business than they were in the previous month. 

The top three reasons Canadian small businesses told us they are positive about the future is that they:

• are making more sales (41%)
• have more work available (40%)
• have seen an improvement in cash flow (29%) 

The first two sentiments are consistent with recent commentary from the Bank of Canada that consumer spending is starting to pick up, even though overall GDP growth was soft in the second half of the year. The reported improvement in cash flow is most likely due to the ongoing downward trend in inflation that has been underway in Canada. This in turn makes it easier to manage costs and eases the squeeze on profits and cash flow.

What are the big macro trends in 2025 and how can you benefit from them?

Every year unexpected events happen, and it’s likely 2025 will be no different. Nevertheless, the macro trends that you, as a small business owner, accountant or bookkeeper, need to stay aware of can be grouped into three broad categories: government policies, central bank actions and productivity. With the right strategy you can turn these big trends, over which small businesses have little control, to your advantage.

New government policies

Canada must go to the polls before October 2025, but the exact timing of the election is unknown at this stage and won’t be clear until a new Liberal leader is selected and parliament resumes on March 24. Canadian small businesses are also likely to be closely watching the actions of the new Trump presidency. The most significant proposed new policy measure that could impact Canadian small businesses is higher tariffs on Canadian goods exported to the US. It will be important for small businesses to stay across the potential flurry of activity arising from both the changing Canadian political landscape and the new US administration.

What can you do: To take advantage of new opportunities, and limit any potential negative impact, you’ll need to remain focused on your business objectives. Working with your advisors, aim to have a good understanding of how any new election-related policy announcements will specifically impact your business, supply chain, staff and customers.

Cash flow pressures should start to ease as inflation returns to target and the Bank of Canada’s rate cuts flow through to small business customers

Higher than normal inflation and the accompanying higher interest rates inflicted a lot of pain on many small businesses over the last two-to-three years. These forces drove up costs, hurt customer spending, and squeezed profits and cash flow. A period of price stability and lower interest rates in 2025 should help ease these cash flow pressures. 

Bank of Canada rate cuts matter to small businesses for two reasons. Firstly, it increases how much they can borrow and/or reduces the cost of their repayments. Secondly, there are indirect benefits from their customers, who themselves should have a bit extra cash to spend in small businesses. 

What can you do: Four in five Canadian small businesses (80%) say they are yet to see the recent cuts to official interest rates resulting in more sales. Interest rate cuts, including the more recent one in December, should start to flow through to benefit small business sales more in 2025.  

Productivity and digitalization

Like many advanced economies, Canada has struggled to achieve productivity growth post-pandemic. Statistics Canada estimates labour productivity fell 0.4% quarter-over-quarter in the September quarter 2024, and was down in seven of the eight previous quarters. This means the post-pandemic economic recovery has been more difficult in Canada than the US, where productivity growth has been much stronger.

What can you do: If you can boost your business productivity then you’ll be able to do some combination of offering lower prices to customers, attracting more skilled staff through higher wages, or lifting the profitability of your business. Think about how you could use digital tools, including those powered by AI, to complete those low-value tasks that take time but don’t bring in sales. Review the processes your business uses to make sure you’re operating in the best way possible, not just a way you’ve always done something. Invest in your staff so that they can maximize the benefit of new technology or processes.  

Get more small business insights

If you’re interested in finding out more about how small businesses in Canada are performing, check out the Xero Small Business Insights for Canada.

1.  All figures, unless otherwise stated, are from an online survey commissioned by Xero in November 2024. Responses are from small businesses in Australia (300), Canada (250), New Zealand (154), UK (600) and US (290) during November 2024. Options have been edited for readability. ︎

The post What’s ahead for your business in 2025? appeared first on Xero Blog.

As 2024 came to a close, Xero surveyed small business owners to find out how they were feeling, what was driving their positive or negative outlook, and how recent interest rate cuts had impacted their business.¹ As Xero’s economist, I’ve reviewed the results and dusted off my crystal ball to bring you my thoughts on what your business is likely to be facing in 2025 and how you can prepare. 

How are small businesses feeling as 2024 ends?

In the US, 88% of respondents said they were either still positive, more positive, or much more positive about their business than they were in the previous month. 

The top three reasons US small businesses told us they are positive, or more positive, about the future is that they:

• are making more sales (45%)
• have more work available (39%) 
• have seen an improvement in cash flow (38%) 

The first two sentiments likely reflect the better-than-expected performance of the overall US economy in 2024. Headline economic data, such as GDP, CPI and the unemployment rate, suggests the US has achieved the much-sought-after sweet spot of bringing inflation back under control while avoiding a recession and a surge in unemployment. The reported improvement in cash flow is most likely due to the ongoing downward trend in inflation. This likely makes it easier to manage costs, easing the squeeze on profits and cash flow.

What are the big macro trends in 2025 and how can you benefit from them?

Every year unexpected events happen, and it’s likely 2025 will be no different. Nevertheless, the macro trends that you, as a small business owner, accountant or bookkeeper, need to stay aware of can be grouped into three broad categories: government policies, central bank actions and productivity. With the right strategy you can turn these big trends, over which small businesses have little control, to your advantage.

New government policies

As with all new governments, it is unclear how much of the campaign platform will be implemented in the first year of the Trump presidency. There are many significant proposed policy measures that could impact small businesses – both positively or negatively – including higher tariffs, reduced immigration, lower taxes, significant tax changes, and deregulation.

What can you do: To take advantage of new opportunities, and limit any potential negative impact, you’ll need to remain focused on your business objectives. Working with your business advisors, aim to have a good understanding of how any new election-related policy announcements will specifically impact your business, supply chain, staff and customers.

Cash flow should benefit from lower inflation and interest rates 

Higher than normal inflation, and the accompanying higher interest rates, inflicted a lot of pain on many small businesses over the last two-to-three years. These forces drove up costs, hurt customer spending and squeezed profits and cash flow. A period of price stability and lower interest rates in 2025 should help ease any cash flow pressures you’ve been dealing with.

The Federal Reserve has begun its rate-cutting cycle, so the question now is, how quickly will rates be cut and to what level? This matters to small businesses like yours directly, as it increases how much you can borrow and/or reduces the cost of repayments. It also benefits you indirectly, due to the impact on your customers’ budgets as they have a little more to spend in your business. 

What can you do: Around three-quarters of US small businesses (72%) say they are yet to see the recent cuts to official interest rates resulting in more sales. As time goes by, more interest rate cuts are likely, as long as inflation follows the path the Federal Reserve currently expects. This means customers should start to have a little more cash available to spend in your business. Make sure you’re ready to respond with sufficient stock, enough staff, and additional marketing capacity. 

Productivity and digitalization

Unlike almost every other developed nation, the US has had solid productivity growth post-pandemic, which has contributed to it avoiding a recession. The Bureau of Labor Statistics estimates US productivity growth was 2% in the year to September 2024. This year’s productivity performance has given US small businesses a good base to work from heading into 2025.

What can you do: If you can boost your business productivity, then you’ll be able to do some combination of offering lower prices to customers, attracting more skilled staff through higher wages, or lifting the profitability of your business. Think about how you could use digital tools, including those powered by AI, to complete those low-value tasks that take time but don’t bring in sales. Review the processes your business uses to make sure you’re operating in the best way possible, not just a way you’ve always done something. Invest in your staff so that they can maximize the benefit of new technology or processes.

Get more small business insights

If you’re interested in finding out more about how small businesses in the US are performing, check out the Xero Small Business Insights for the US.

1. All figures, unless otherwise stated, are from an online survey commissioned by Xero in November 2024. Responses are fromsmall businesses in Australia (300), Canada (250), New Zealand (154), UK (600) and US (290) during November 2024. Options have been edited for readability. ︎

The post What’s ahead for your business in 2025? appeared first on Xero Blog.

While it’s often referred to as ‘self assessment season’ we know in reality most of you spend 10 months of the year preparing for the 31 January deadline. However, there’s always that last minute rush of chasing missing data from clients which makes January a stressful time. 

We recently teamed up with Accounting Web to put together a special report with some helpful tips for making self assessment season less stressful and more efficient. We talked to firms who have found ways to streamline their workflows, reduce pressure, and free up time for things like growth, cash flow planning, and team wellbeing.

Now, let’s look ahead to the new tax year and explore some practical ways to boost wellbeing after the busy season.

Time to celebrate and reflect

First things first, take a moment to celebrate! You made it through another stressful January. Now it’s a good time to reflect on what worked well and what could be improved.

Think about your practice’s processes and technology, but don’t forget about your team’s wellbeing and stress levels. As we head into a new tax year, consider what small changes you could make to improve things for yourself and your team. Here are a few ideas:

1. Connect with your community

Don’t underestimate the power of community. Connect with fellow accountants and bookkeepers at networking events, industry conferences, online groups and forums.

Beyond providing emotional support, your community can help you achieve your work goals. If you’re feeling overwhelmed, having a network of trusted accountants and bookkeepers you can talk to or collaborate with can help balance client obligations and take the pressure off.

With more people working remotely or in hybrid setups, it’s important to be intentional about staying connected. Schedule time for social activities within your practice and consider off-site days, retreats, and conferences. It’s often easier to check in on each other’s wellbeing when you’re face-to-face.

2. Embrace flexibility

Flexible working hours can make it much easier to balance your work and personal life. You can save hours of time by reducing your commute, either by avoiding peak times or working remotely. But one of the biggest benefits to your wellbeing is that you don’t have to pick between practice and personal life. If you’re supporting a loved one or recovering from a restless night, you can adjust your hours to match your energy levels.

Traditional 9-to-5 hours don’t work for everyone. Some people are more productive in the evenings, while others prefer to get things done early. Work with your natural rhythms to make the most of your day.

A change of scenery can also do wonders. Why not take your laptop on your travels and work from somewhere new? Whether it’s a short break or a longer trip, combine work with some well-deserved downtime.

Just remember to set boundaries when you’re working flexibly. It’s easy to overwork or blur the lines between work and personal time. Be clear with clients and colleagues about your working hours.

3. Keep learning and growing

Continuous learning is essential for wellbeing. Gaining new skills can grow your confidence and help you feel equipped to respond to changes in the industry. 

You could try incorporating skill sharing within your practice. Invite team members to give short talks or workshops on their areas of expertise. You could even set up an internal coaching program to help junior staff develop specialised skills and encourage more experienced team members to mentor and build connections.

4. A healthy mind leads to a healthy practice

By addressing mental health and wellbeing through small changes, you can build a healthier mind and a healthier practice. Take advantage of all the support that is available to ensure you can thrive not just through the end of tax season but all year round.

The post How to thrive after the busy season appeared first on Xero Blog.