Xero

Our view at Stack - Xero is a cloud-based accounting platform that offers numerous benefits. It simplifies financial management with automated bank feeds, allowing you to save time on data entry. Create, email, and print professional invoices effortlessly. Access your finances in real time via the cloud from any device. Retain records of income, expenses, assets, and liabilities securely online. Whether you’re a small business owner or an accountant, Xero streamlines your financial processes and provides a clear view of your financial health.

We recently announced that we’ll be retiring the older version of our invoicing product — classic invoicing — on 2 September 2024. We know you have plenty of questions and concerns about this change, so we thought we’d share an update on what’s happening behind the scenes.

The good news: our teams are busy building a new invoicing product that is going to give you far more flexibility and customisation in the future, with beautiful checkout experiences and unlimited payment methods. It’s also built using the latest technology, so we can roll out more of your Xero Product Ideas over time.

Building new features you love

We’re seeing so many great ideas about what invoicing features you’d like to see in Xero. Unfortunately, we can’t roll them out in classic invoicing because of the limitations that we face with the older technology (think of it like trying to plug an electric charger into a classic car).

Our new invoicing solution is a flexible and scalable solution that’s built on the latest technology, so our teams can build the features you need now and in the future. And believe me, we’re really focused on delivering these for you! Some of the features we’re working on at the moment include:

• adding multiple delivery addresses on an invoice
• requesting partial payments and deposits via invoicing
• more customisation of invoicing templates and on repeating invoices
• improved control and smarter scheduling of reminders
• easier statement creation and statement payment capability

The changes we’ve made so far (and what’s next)

In addition to this list of features exclusive to new invoicing, there are a number of features from classic invoicing that we’re planning to bring across to the new version. We know these are extremely important to you, and want to reassure you that many of these will be available before September.

So far, we’ve already introduced the following improvements to new invoicing:

• Copy information from invoices to quotes
• Option to ‘Create another invoice’ once an invoice is approved
• Add ‘Reference’ when adding a payment without an extra click
• Option to ‘Send receipt’ after a payment is added to an invoice
• Quickly create and save a contact on the fly without extra clicks 
• View item code on the ‘View invoice’ page
• Paste numbers with commas or dollar signs into line items 
• Delete line items in just one click

Many of these changes are in response to your feedback about the design and usability of new invoicing, and our teams are working hard to make sure these will improve your processes and workflows.

We’ve given you plenty of time to keep exploring new invoicing, as we roll out new functionality. Remember, you can keep switching between the two versions until classic invoicing is retired on 2 September 2024.

Keeping you informed, every step of the way

As members of our community, your feedback is extremely important and we are committed to keeping you updated on our progress as we move towards September, including a release log on Xero Central (coming soon).

As always, we encourage you to share your ideas in Xero Product Ideas, and our team is also here to give you a hand if you have any questions or need support.

The post Xero invoicing: how we’re building a smarter, more flexible future appeared first on Xero Blog.

If Xero is of interest and you'd like more information, please do make contact or take a look in more detail here.

Credit: Original article published here.

Our view at Stack - Xero is a cloud-based accounting platform that offers numerous benefits. It simplifies financial management with automated bank feeds, allowing you to save time on data entry. Create, email, and print professional invoices effortlessly. Access your finances in real time via the cloud from any device. Retain records of income, expenses, assets, and liabilities securely online. Whether you’re a small business owner or an accountant, Xero streamlines your financial processes and provides a clear view of your financial health.

Dive into the world of franchising in this Q&A with Lime Licensing’s CEO, Andy Cheetham, as he shares his expertise, insights, and advice for businesses looking to franchise. 

How can a business determine if its model is suitable for franchising? 

Franchising is all about replication. If your current business can create a clone of itself in another location then it’s likely that your clone could be a franchise, provided it can be profitable of course! 

I like to see a business that has gone through its learning curve already, and whilst no business is ever the finished article, a bonafide franchise should be a developed format that has already got most of the wrinkles ironed out of it.

What are the legal considerations businesses need to be aware of when venturing into franchising? 

At Lime Licensing Group we concentrate on Intellectual Property first, and get that in the right hands at the outset. Then there’s confidentiality agreements, deposit agreements for franchisees who wish to secure a franchise option, franchise agreements to lay out the terms of engagement, and sometimes other supporting legals from side letters, through to development or master agreements. 

What financial factors should businesses evaluate before deciding to franchise? 

Businesses that are ready to scale have three options.The first is growing organically, the second is growing through acquisition, and third is scaling through franchising or licensing. A savvy potential franchisor will have considered the relevant capital requirement of each before choosing franchising. Assuming that they then progress as franchisors, what matters above all else is that the franchise owner’s business can be profitable with territorial restrictions in place and the presence of a royalty. 

In simple terms, a new franchisor should ask themselves if they could replicate what they are doing in a defined region, and with a discount off their net VAT turnover of at least 10%. If the answer to both of these is yes, then franchising is a possibility. A new franchisor can get a 100% return on investment with the sale of the first franchise, so the business case  is extremely viable.

How can a franchisor provide ongoing support to maintain consistency across franchise locations? 

Franchisors should inspect what they expect. I am used to seeing franchisors trying to manage everything in-house, but often external suppliers can do just as good a job. Either way, the rules of engagement are set out in each franchisee’s operational manual and then it’s the job of the franchisor to ensure that standards of delivery from franchisee to customer are consistent with the guidelines.

How can businesses tailor their marketing strategies to promote their franchise model? 

By keeping the characteristics and core brand message, a new franchisor can focus on how best to convey the business opportunity of joining them. Most owner operator franchise buyers are in a career change, so existing contacts might not be the best place to roll out franchise marketing. At Lime Licensing Group we have around 50 different media channels that can work. It’s always a challenge to determine which media or strategy will generate franchise enquiries, but that’s something we as consultants can help new franchisors with.

How can a business ensure that potential franchisees align with the brand and values? 

We never sell franchises over zoom or the telephone alone. Instead we aim to get them into the environment they may be working in and interacting with clients at some level. If you’re a care based business, can you set something up to observe them in a care environment? HQ visits can work well too and we have a number of clients who do psychometric tests to supplement their judgement. 

How should businesses conduct market analysis to identify potential franchise locations? 

Any good franchisor knows how to assess a new region or criteria for a new outlet, but it’s important that the franchisee ensures a satisfactory commercial environment exists in the proposed area. So they need to find the competition they might encounter. This results in new franchisees being proactive and showing the franchisor they understand that in many cases, due to their proximity to their actual franchise, that they are best placed to find a location or assess local demand for a product or service. 

How can technology be leveraged to streamline franchise operations? 

Unified technology – both hardware and  software is always beneficial. It makes support , implementation, and upgrades easier. Having everyone using the same tech results in consistency whether it’s the CRM, bookkeeping software like Xero, or POS Systems for retail. 

Franchising is a strategic leap that requires meticulous planning. Assess your business readiness, establish a robust system, navigate legalities, and prioritise transparent communication with franchisees. Success hinges on adaptability and a commitment to excellence. To find out more about how Xero can help you on your franchising journey, visit our dedicated franchising homepage here.

The post To franchise or not to franchise: What should a business consider before taking the leap? appeared first on Xero Blog.

If Xero is of interest and you'd like more information, please do make contact or take a look in more detail here.

Credit: Original article published here.

Our view at Stack - Xero is a cloud-based accounting platform that offers numerous benefits. It simplifies financial management with automated bank feeds, allowing you to save time on data entry. Create, email, and print professional invoices effortlessly. Access your finances in real time via the cloud from any device. Retain records of income, expenses, assets, and liabilities securely online. Whether you’re a small business owner or an accountant, Xero streamlines your financial processes and provides a clear view of your financial health.

If you’re running a small business that employs staff, you know the administrative ‘to-do’ list can be quite lengthy. Onboarding, managing timesheets, setting wages, processing payroll, preparing for end of financial year… it can all take up valuable time. Pay runs in particular need to be easy and efficient for you, as well as your accountant and bookkeeper. 

We’ve been listening to your feedback about Xero Payroll and excited to share some great new enhancements in the UK, marking the beginning of more improvements to come. These will automate processes and reduce the risk of manual calculation errors, so you can stress less about payroll compliance and get more time back to do what matters most: running your business.

You can now switch to Xero Payroll in a few easy steps

Moving payroll data from one software system to another can be complex and time consuming, and there’s no room for error. If you love using Xero but haven’t tried Xero Payroll yet, we’ve made it super easy to get set up. 

Simply upload your latest government filing (full payment submission) into the payroll switching wizard and Xero will facilitate the automatic transition of these records, streamlining the migration of your data and guiding you step by step through the process. In a few steps, you’ll be set up in Xero Payroll and ready to go.

Tailor your employee working patterns and reduce manual workarounds

In an increasingly flexible world, the idea of working the traditional hours from Monday to Friday is an outdated concept. To reflect this flexibility, we’ve created new employee working patterns templates.

If you’re a Xero Payroll Admin, you can now enter more information about your employees’ contracted working patterns. This is especially useful for annual salaried employees who are working non-traditional hours (for example, a four-day work week). 

Payroll Admins can easily create templates, as well as set multiple weeks for salaried employees who work different hours each week. To set up a new template, navigate to the ‘Working Patterns’ tab within Payroll settings.

We’re excited to roll out this improvement, which was ranked as the second most requested feature in Xero Product Ideas for UK Payroll.

More guidance to set up employee pensions

We’ve also released the new and improved Pensions setup experience, with additional built-in guidance, and interactive steps which only display the relevant details to each employee’s record.  This improvement supports accurate setup and makes the best use of Xero Payroll’s automation on pension assessments.

We’ve also simplified how you manage your auto enrolment obligations with increased flexibility to edit and update fields.

There’ll be more updates to come, but in the meantime if you’d like to learn more about confidently managing your accounting and payroll in the one place, don’t forget to register for one of our Xero Payroll webinars.

The post We’re paying back time with new changes in Xero Payroll appeared first on Xero Blog.

If Xero is of interest and you'd like more information, please do make contact or take a look in more detail here.

Credit: Original article published here.

Our view at Stack - Xero is a cloud-based accounting platform that offers numerous benefits. It simplifies financial management with automated bank feeds, allowing you to save time on data entry. Create, email, and print professional invoices effortlessly. Access your finances in real time via the cloud from any device. Retain records of income, expenses, assets, and liabilities securely online. Whether you’re a small business owner or an accountant, Xero streamlines your financial processes and provides a clear view of your financial health.

The start date for Basis Period Reform is fast approaching. From April 2024, your sole trader and partnership clients will need to follow a tax year basis for Income Tax as part of HMRC’s Basis Period Reform. 

The reform is only expected to impact 7% of sole traders. However, 33% of partnerships are likely to be affected. 

The 2023/24 tax year is a transitional period, and you’ll need to do some extra admin to make sure your sole trader and partnership clients are compliant. We explore how to prepare for Basis Period Reform and how Xero can support you. 

What is Basis Period Reform and who’s affected?

As outlined above, Basis Period Reform is a change to the reporting period used for Income Tax purposes. The measure impacts sole trader and partnership clients who use their own accounting year for Income Tax reporting. 

Going forward, you’ll need to report the profits clients generate in the tax year on their Income Tax Return, instead of the profits they generate during their accounting year. Clients who already use the tax year basis won’t need to make any changes. 

Some of your clients might decide to change their accounting date, in order to simplify Income Tax reporting. HMRC counts any date between 31 March to 5 April as tax year-aligned, but clients can still keep their original accounting date if needed. For instance, if your clients work in seasonal industries such as farming, they may choose to keep a September accounting date because this is their quietest period. 

Note: businesses that begin operating from 6 April 2024 will automatically use the tax year basis.  

Why is the new basis period coming into place?

Basis Period Reform will mean profits are taxed closer to the time they’re earned. According to HMRC, this will make tax planning easier for businesses, improve compliance, and reduce tax debt write-offs. It means all sole traders and partnerships will be taxed within the same period. 

Property income, interest, and dividends are already taxed on this basis. Through Basis Period Reform, the Income Tax system will be aligned with these other income types. You’ll use the same reporting period for your clients, for all of these income types. 

There’s an additional benefit to adopting a tax-year basis now. When Making Tax Digital (MTD) for Income Tax comes into place, sole traders and landlords will be required to submit quarterly updates in line with the tax year. By shifting to a tax-year basis now, you and your clients can get comfortable with tax-year reporting ahead of time. 

What are the two phases of Basis Period Reform? 

First, a transitional period for the 2023/24 tax year. Clients with a year-end date that doesn’t align with the tax year will have an extended basis period for their 2023/24 tax year. You’ll need to apportion profits from two sets of accounts that make up the tax year to file their Income Tax Return. 

Then, Basis Period Reform will take full effect in the 2024/25 tax year. All sole traders and partnership clients must use the tax year basis. Some of your clients might choose to align their accounting dates with the tax year to simplify their reporting requirements. For clients who wish to keep their accounting date, you’ll need to continue apportioning profits as you did in the transitional year. 

How does the transitional period work? 

For clients who aren’t already following the tax year basis, you’ll need to apportion profits from two sets of accounts to complete their 2023/24 Income Tax Return. Let’s look at an example: 

Your client, Maria, has a 31 December year-end. 

Her basis period for the 2023/24 tax year has two parts: 

• Her accounting year: 1 January 2023 – 31 December 2023 
• Plus, the transitional part: 1 January 2024 – 31 March 2024

In total, Maria will be taxed on 15 months’ profit for her 2023/24 Income Tax Return. For an in-depth guide on calculating transitional profits, check out the HMRC website. 

During this transitional period, tax bills are likely to be higher for clients who don’t already use the tax-year basis. To accommodate higher tax bills, HMRC is allowing taxpayers to spread these overlap profits over five years and cushion the impact on their cash flow.

Some of your clients may also be entitled to overlap relief if they started trading with a non-tax year-aligned accounting date. You can claim this on their behalf during the transitional year if you have access to the additional tax amounts. HMRC is also working on an online form to request clients’ overlap profit figures directly. 

Managing transitional profits might sound like an added layer of complexity. But we’ve made updates to Xero Tax which means you’ll be able to include transitional profit claims and basis period adjustments on self-employment and partnership income worksheets. 

How can you prepare your practice and clients for the new measure? 

Clients will look to you in the coming months for advice and guidance on the measure. They’ll need your help with apportioning profits, switching accounting dates, and understanding the legislation. 

Your practice will also see an increase in admin. For clients who aren’t using the tax year basis already, you’ll need to apportion profits from their two accounting periods that fall within the tax year. If they decide to keep their accounting date, you’ll need to do this for every Income Tax Return going forward. That could mean preparing multiple sets of accounts for clients, every year. 

And for those who have an accounting date that falls after September, you might struggle to finalise figures ahead of the 31 January deadline. Instead, you’ll need to submit provisional figures to HMRC and confirm these estimates when you submit clients’ following Tax Returns. This essentially means you’re filing two returns per client, each year. 

If this sounds overwhelming, rest assured that there are tools to help you tackle the admin. Cloud-based software for accountants and bookkeepers can automate daily bookkeeping tasks and provide you with accurate and reliable transaction data for clients. This can then be used to apportion profits, report income, and provide provisional figures. 

Xero is now fully prepared to support you with any Basis Period Reform adjustments. You can easily extend your financial year-end date without any disruption to fixed asset depreciation. Enjoy clear, streamlined tracking and reporting of transitional data, including transitional profit claims and basis period adjustments.

For more guidance, watch our latest on-demand webinar that outlines how to manage Basis Period Reform changes in Xero or take a look at our complete guide to Basis Period Reform and Xero Central page on Basis Period Reform. 

The post How Xero can support you with Basis Period Reform appeared first on Xero Blog.

If Xero is of interest and you'd like more information, please do make contact or take a look in more detail here.

Credit: Original article published here.

Our view at Stack - Xero is a cloud-based accounting platform that offers numerous benefits. It simplifies financial management with automated bank feeds, allowing you to save time on data entry. Create, email, and print professional invoices effortlessly. Access your finances in real time via the cloud from any device. Retain records of income, expenses, assets, and liabilities securely online. Whether you’re a small business owner or an accountant, Xero streamlines your financial processes and provides a clear view of your financial health.

Recently, small businesses have had to navigate some pretty significant headwinds in the macroeconomic environment. Persistent inflation has led to rising interest rates, flowing through to slowing economic growth. The unemployment rate is still low, which is great news… except if you’re a small business looking for staff.

Yes, these issues are all featured widely in the media. But what’s often missing from this coverage is how these trends are affecting small businesses.

To be an effective advisor, it’s critical to understand what’s happening in the economy and how it’s impacting your clients. Not only does it help you identify what challenges they’re facing, but it also gives you an insight into the opportunities available to them.

That’s why I took the stage at the recent Xero Summer Series to talk to advisors like you about Xero Small Business Insights (XSBI) — covering the latest data and how it can be used by accounting and bookkeeping practices.

What’s the latest XSBI data telling us?

The latest XSBI data was released on March 5, 2024 and shows that after coping reasonably well for much of 2023, small businesses came under pressure in December.

The combination of multiple interest rate rises and ongoing higher-than-usual inflation appears to have reached a tipping point in the final month of the year, with the Xero Small Business Index falling 37 points in December to its lowest level since September 2020. You can read the full Australian XSBI report and explore the data yourself.

How can you use XSBI in your practice?

I loved talking with you at Xero Summer Series, hearing all the wonderful ways you’re using the XSBI data in your practice. Here’s a snapshot of what I heard.

• Staying informed about small business trends: XSBI gives you great awareness of how small businesses, in aggregate, are performing. It helps give valuable context when thinking about how to best assist your clients at any given point in the economic cycle. 

• Having deeper client conversations: XSBI is a useful conversational tool with clients, and provides a solid benchmark when assessing performance. For example, do you need to give a client advice on how much they need to lift wages in their hospitality business? You can easily refer to the XSBI data, and see how hospitality wages are tracking nationally, and also investigate specific state wage data. 

• Sharing information with clients: The data is completely free to use in communication with clients, such as newsletters or social media (all we ask is that you credit XSBI as the source). Sharing the data can help clients understand how small businesses are performing, and positions you and your practice as an expert in the small business environment. 

Take a deep dive into XSBI data and research

XSBI uses anonymised and aggregated data (it’s not a survey!) from over 600,000 small businesses across Australia, Canada, New Zealand, the UK and US. XSBI also has data on all Australian states and the ACT, as well as 17 different industries. You can easily explore all the latest XSBI findings, including downloading the anonymised and aggregated data.

The program not only includes a quarterly release of data, but also regular blogs about small business issues and XSBI special reports on topics like cash flow or technology use. If your interest lies in what is happening in a particular country, you can also check out the specific research we have on Australia, Canada, New Zealand, the United Kingdom and United States.

The post Summer Series reflections: making the most of XSBI in your practice appeared first on Xero Blog.

If Xero is of interest and you'd like more information, please do make contact or take a look in more detail here.

Credit: Original article published here.

Our view at Stack - Xero is a cloud-based accounting platform that offers numerous benefits. It simplifies financial management with automated bank feeds, allowing you to save time on data entry. Create, email, and print professional invoices effortlessly. Access your finances in real time via the cloud from any device. Retain records of income, expenses, assets, and liabilities securely online. Whether you’re a small business owner or an accountant, Xero streamlines your financial processes and provides a clear view of your financial health.

We know end of financial year is a busy time, so we’ve prepared a quick 10-step checklist to help you cover your bases at the end of FY24 and start the new financial year off strong. 

If you’re using Xero, you can find more helpful information in our handy guide for getting ready for financial year end.

End of financial year checklist for business owners

In no particular order, here are some tasks to tick off to set yourself (and your business) up for a successful FY25. 

1. Get on top of your outstanding payments & invoices

Got any outstanding bills to pay, or money to receive? Get up to date on your income by chasing any invoices from customers who haven’t paid yet, and square up anything you still owe.

Save time on sending invoices and reminders in the new year by using an accounting software that does it for you. If you’re using Xero, there’s apps in the Xero App Store that can help with this too.

2. Evaluate your business expenses

You may be able to claim business expenses in your tax return to reduce the total tax you need to pay. 

Go over your business expenses to understand where money was spent and identify where you can potentially claim expenses against your taxable income. There are digital tools available that automate your expense management so that it’s less of a headache by the end of the year.

You can also find opportunities to reduce costs, plan your upcoming expenses and make sure you stay profitable in the new financial year.

3. Get up to date with GST

If your business is GST-registered, you’ll need to sum up and pay any GST you owe at the balance date for the end of the financial year. You can do this online, with accounting software or through your myIR account with Inland Revenue. You may want to consult an accountant or bookkeeper for this step.

See our GST guide for business to make sure your bases are covered for filing and paying GST. 

4. Take advantage of credits

Depending on your business, you could be eligible for credits that can lower your tax bill. You may want to seek advice on what you could be eligible for.

For example, if your business invested $50,000 or more in certain research and development activities, you could be eligible for a 15% R&D tax credit. Or, if some of your income has come from overseas, you could receive a credit for any foreign tax paid abroad.

5. Review your inventory or services

As part of your year-end review, consider your physical inventory and/or services. This helps confirm what you still have on hand, and that your assets are accurately recorded. 

Plus, you can plan for a more profitable FY25 by focusing on what’s selling by:

• Reviewing what was in high-demand in FY24, and what was the most profitable
• Setting a budget for ordering in more products, or promoting the most profitable services
• Retire goods or services that haven’t served the business well – you could offer discounts on discontinued goods, or use them for future promotions 
• Consider any new goods and services to offer, based on customer enquiries and what’s already selling well

6. Take a good look at your financial records

Take stock of your payroll, profit and loss statements, balance sheets, and cash flow records at the balance date. This helps you to understand how much profit you might’ve made, view your overall performance for the financial year, and get ready to file tax returns.

Check and fill any missing records or gaps in financial information before closing off your books.

7. Assemble your tax documents

To file your end of fiscal year tax return, you’ll need to finalise payroll and gather your income statements and business expense records. 

With this information, you’ll declare the profit your business earned and any expenses you can claim as a deduction to Inland Revenue. You might want to consult an accountant or bookkeeper for this step.

8. Check in with your people

It’s a great idea to connect with staff, customers, and business partners. Ask for feedback on what’s working, what people would like to see more of, and any processes or operational kinks that need smoothing out.  

You could do this through surveys and meetings with staff and stakeholders. Be sure to share how you’ve incorporated their feedback.

9. Set yourself some goals for the new financial year

Now that you’ve reflected on the year that’s been, it’s time to set objectives for the year ahead. 

Consider your business’s accomplishments and how you could build on those. Set clear, realistic goals for growth opportunities you’ve identified, and identify solutions for challenges the business faced this year. 

10. Give yourself time to breathe

Finally, take time to look after yourself. The end of the financial year brings a surge in work to-dos, and it’s important to move into FY25 with strength. Caring for your wellbeing ensures you’re at your best to care for the business.

Take the pressure off with Xero

Feeling the end of financial year stress? Xero’s accounting software can help take the pressure off by automating unloved and tricky tasks, and make it easier to manage your finances throughout the year. 

You can even collaborate with your accountant or bookkeeper through the tool, so they stay informed on your business and are in the best position to help.

There’s also a range of apps that connect to Xero, covering everything from debtor management to reporting, payroll and payments in the Xero App Store.

The post Your 10-step checklist for end of financial year in 2024 appeared first on Xero Blog.

If Xero is of interest and you'd like more information, please do make contact or take a look in more detail here.

Credit: Original article published here.

Our view at Stack - Xero is a cloud-based accounting platform that offers numerous benefits. It simplifies financial management with automated bank feeds, allowing you to save time on data entry. Create, email, and print professional invoices effortlessly. Access your finances in real time via the cloud from any device. Retain records of income, expenses, assets, and liabilities securely online. Whether you’re a small business owner or an accountant, Xero streamlines your financial processes and provides a clear view of your financial health.

The end of the financial year is around the corner, so it’s time to review the latest changes and start getting ready to complete your payroll year end. Here are some key updates you need to know about, as well as our tips for a smooth transition into the 2025 financial year.

Latest changes

Payroll is always evolving, but there were a few little surprises this year. These include changes to National Insurance (NI) contributions effective from 6 January (followed by a second change effective 6 April), a new Scottish tax band and holiday pay reform.

The holiday pay reform, along with updated HMRC reporting requirements for employee hours coming into effect in FY26, means that it’s never been more important to ensure your employee’s records are up-to-date — especially the number of hours they’ve worked.

Investment Zone NI categories

From 6 April 2024, HMRC are introducing new NI categories for employees that work in the specified Investment Zones. Any employees who meet the criteria will need to be processed and reported to HMRC under the new category letters. 

Xero has included these new category letters for you to select and apply to eligible employees, to receive the employers NI relief available within the scheme. There will be a notification in the pay run when an employee’s eligibility period for these new NI categories come to an end.

Further reduction to NI

As announced in the Spring Budget on 6 March, HMRC are applying a further reduction to employee class 1 NI contributions from 10% down to 8% as of 6 April. Once passed through Parliament, all new pay runs processed in FY25 will apply the new rate.

Updates to paternity leave

Employees will be able to provide 28 days’ notice prior to the dates they wish to take their paternity leave. They will also be able to request their paternity leave in two non-consecutive periods of one week, or a two-week block. They will be able to take their paternity leave within 52 weeks of the birth of the child, or placement for adoption.

Other updates

In addition to the changes we’re automating in Xero Payroll, there are some other updates to keep an eye on. Here’s an overview of these changes.

National Minimum Wage and National Living Wage

Here are the latest updates to the National Minimum Wage and National Living Wage rates:

• Aged 21 and above (national living wage rate) £11.44
• Aged 18 to 20 £8.60
• Aged under 18 (but above compulsory school leaving age) £6.40
• Apprentices aged under 19 £6.40
• Apprentices aged 19 and over, but in the first year of their apprenticeship £6.40

Holiday entitlements

The Government has introduced reforms to simplify holiday entitlement and holiday pay calculations in the Working Time Regulations, for leave years beginning on or after 1 April 2024.

Part-year and irregular hours workers are legally entitled up to a maximum of 5.6 weeks of paid statutory holiday entitlement per year, calculated according to actual hours worked using the 12.07% accrual method. 

Employers are also able to use rolled-up holiday pay as an additional method for calculating holiday pay for irregular hour and part-year workers only.

Our tips for payroll year end

Just like last year, we’ve created an end of tax year checklist to guide you through reviewing and updating your settings for the 2025 financial year. Our payroll specialists are also here to support you at any time. Reach out to them via Xero Central support, or check out our support articles and webinars. 

1. Get prepared

Before you process your final pay run for the 2024 financial year, you’ll need to approve any remaining leave requests, timesheets and overtime, to ensure the employee’s final pay values are correct. 

Even though you regularly reconcile your posted pay runs, now is a good time to also check reports such as the P32, P11s, Gross to Net and Account Transactions to make sure there are no discrepancies.

If your business is in the construction industry, we recommend you review and reconcile your Construction Industry Scheme (CIS) Suffered report for the tax year. 

2. Complete your final pay run

Next, onto completing the final pay run. You’ll need to make sure the payment date is between 6 March and 5 April 2024. If you process weekly pay runs, you’ll likely have a week 53 pay run this year. Xero takes care of this for you and will adjust the tax calculation automatically. 

Xero will submit an Employer Payment Summary (EPS) to HMRC to confirm that your final pay run of the year has been processed. If you have no employees to pay, you’ll need to post a NIL pay run to trigger the EPS.

If you need to make any changes after processing the pay run, you’ll need to make these adjustments by 19 April 2024. Once you’re happy with the final figures and you’re ready, review the P60 reports. 

You can also share P60s with your employees through Xero Me. P60s need to be provided to your employees by 31 May 2024. 

3. Update your payroll for the new tax year

Before starting your first pay run for the new tax year, you’ll need to update your payroll by checking the following.

• Employment allowance: Check if you are eligible. If you are, you’ll need to activate this allowance for the new tax year within the HMRC tab under payroll settings.

• National Insurance: Review director NI calculation methods and employees NI categories, keeping an eye out for any deferment certificates. Remember to check if you have any employees who are operating in a UK freeport or are qualifying veterans, as you may be entitled to claim relief by updating their category letter.

• Tax codes: Xero automatically resets any previous W1/M1 calculation methods to cumulative for the new tax year. Any P9X tax code changes received from HMRC will also be applied for you to review.

• Payroll benefits: If this is something that you offer or are considering, then you need to register with HMRC before the start of the new tax year. For any existing benefits in kind that you’re processing through Xero Payroll, review the benefit value and availability dates for the new tax year. For cars and vans, make sure you keep the ‘available to’ date blank if you’re rolling the benefits forward. Xero Payroll will automatically insert the new benefit line, ready for you to process in your first pay run. Make a note of 6 July 2024 to complete and submit your P11D(b) for any employer class 1A NI due.

• Corporation Tax UTR for CIS suffered – If you’re claiming CIS suffered, you’ll need to enter the Corporation Tax UTR reference on the HMRC tab in payroll settings. If this isn’t currently entered, you’ll be asked to add this when scheduling your next EPS and entering an amount of CIS suffered.

The post Get set up for the new tax year with Xero Payroll appeared first on Xero Blog.

If Xero is of interest and you'd like more information, please do make contact or take a look in more detail here.

Credit: Original article published here.

Our view at Stack - Xero is a cloud-based accounting platform that offers numerous benefits. It simplifies financial management with automated bank feeds, allowing you to save time on data entry. Create, email, and print professional invoices effortlessly. Access your finances in real time via the cloud from any device. Retain records of income, expenses, assets, and liabilities securely online. Whether you’re a small business owner or an accountant, Xero streamlines your financial processes and provides a clear view of your financial health.

Over a year ago, we launched an early version of Xero Go to see how a purpose built app could help cater for the entry-level accounting needs of the self-employed in the UK.

We have spent the last year testing and refining Xero Go and after completing a careful review to understand the future of the product, we found greater investment was required to meet the changing customer needs and expectations around the product. 

By putting those resources into our core Xero accounting platform, payroll and our mobile app, it will allow us to better meet our customers’ needs over the long term.

As a result, we will be retiring Xero Go on 12 September 2024 and will reallocate these resources, capabilities and expertise as we sharpen our focus on delivering to customer needs. 

We really appreciate the support of the sole traders and our accounting and bookkeeping partners who have been using the app during this free period. 

What do Xero Go customers need to do?

All Xero Go customers can continue to use Xero Go for free until 12 September 2024. We recommend exploring alternative solutions to start using at the beginning of the new financial year (i.e. from 6 April) so all your data for the next financial year is in one place. 

The paid Stripe add on will continue to be available during this time, after which customers may choose to use their Stripe account separately.

For those that want to export their data, we’ve added a simple button in the app allowing users to instantly download data stored in Xero Go. The data can be downloaded as many times as required between now and 12 September. Users will need to upgrade to the latest version of the app, to utilise the export feature. 

What does Xero offer as an alternative

Xero offers Starter and Standard plans which are suitable for small businesses, and also have a companion mobile app. Additionally, these plans have some important features like bank feeds reconciliation that weren’t available in Xero Go. All current users of Xero Go can sign up via the latest version of the Xero Go app to receive six months free on either one of these plans, and we’ll work with you to migrate your data from Xero Go into your new Xero solution.

Current Xero Go users can register for a free webinar on alternate Xero Solutions here.

We want to reaffirm our commitment to supporting UK businesses and their advisors with digital solutions. We believe this decision will help us focus our efforts on the future, and deliver more value in the long term.

The post UK mobile app, Xero Go, to be retired appeared first on Xero Blog.

If Xero is of interest and you'd like more information, please do make contact or take a look in more detail here.

Credit: Original article published here.

Our view at Stack - Xero is a cloud-based accounting platform that offers numerous benefits. It simplifies financial management with automated bank feeds, allowing you to save time on data entry. Create, email, and print professional invoices effortlessly. Access your finances in real time via the cloud from any device. Retain records of income, expenses, assets, and liabilities securely online. Whether you’re a small business owner or an accountant, Xero streamlines your financial processes and provides a clear view of your financial health.

As the summer days become a memory, it signals the onset of a crucial period for payroll professionals in New Zealand. With the approaching new tax year on 1 April 2024, regulatory changes are set to impact payroll calculations across the country. Staying informed and getting prepared is essential. 

In this article, we delve into these updates and provide four steps to help navigate the upcoming year-end period seamlessly, with Xero Payroll. Whether you’re a seasoned payroll manager or new to this all, arming yourself with this knowledge will be instrumental to maintaining accuracy and efficiency within your payroll operations.

Important upcoming changes for New Zealand payroll compliance

There are four key changes in New Zealand payroll calculations coming up for the new tax year:

• Adult minimum wage will increase to $23.15 per hour from 1 April, 2024
• The annual ACC earner levy rate is increasing from 1.53 percent to 1.60 percent 
• The annual ACC earner levy threshold is increasing to $142,283
• The student loan threshold is increasing to $464 per week. See table below:

If you are paid…	Your student loan repayment threshold is…
Weekly	$464
Fortnightly	$928
Half-Monthly	$1,005.33
Four-weekly	$1,856
Monthly	$2,010.67

In Xero Payroll, the above rates are automatically applied to any pay runs with a payment date on or after 1 April. Your employees may see slight variations in their payslip.

With this in mind, below are some steps to get you smoothly through the year end period.  

Step one: Post the last pay run

Make sure all your pay runs for the financial year have been posted. If you’re using payday filing through Xero, you’ll also need to make sure these have been filed. To make sure these pay runs are reported in the 2023 – 24 financial year, the payment date will need to fall on or before 31 March 2024.

Step two: Review and reconcile

Go to payroll settings to review all the information that impacts your payroll reporting. If anything is incorrect, you can update this before processing your first pay run for the new financial year. You can also take this opportunity to check that any final employee payments and changes have been put through.

You’re likely already regularly reconciling posted pay runs, but it’s always a great idea to run your eyes down reports like pay history and leave transaction reports to make sure there are no surprises. Here are some tips that may help:

• If multiple expense accounts have been used for earnings and KiwiSaver, make sure the totals are added together and compared against the pay history report.
• Check for any transactions incorrectly reconciled against your expense accounts. You can check this by running the Account Transactions report in Xero.
• If your totals don’t look correct, this could be due to some manual journals. Check the amounts by running the Journal report in Xero, and then click manual journals.
• If you’re having trouble locating the source of a discrepancy, run your reports for a smaller date range (like monthly) or by each pay period.

Step three: Make any amendments

Any errors made throughout the financial year (such as missed or incorrectly posted pay runs) can be corrected using an unscheduled pay run.

Simply create the pay run for the required period, and enter the adjustment amounts. These adjustments will be filed with Inland Revenue (IR). You can even enter negative values, if needed. If you do this, you will need to use myIR to manually adjust the returns for the employee. In myIR you can edit previously returned files, however, if the adjustment is for a period before the current tax period it might be worth contacting IR to discuss.

Once any amendments are made, check the payment date of the unscheduled pay run falls within the correct financial year, so it’s reported correctly.

Step four: Review and update employee details

• With the increased minimum wage, don’t forget to check and update the salary and wage details for any impacted employees.
• You should also review current leave entitlements and make any adjustments as necessary – especially if work patterns have changed recently.
• Finally, remember that you need to review and update the ESCT rate for each employee when they start working for you and at the start of each tax year. If your employee’s salary or wages change during the tax year, do not change the ESCT rate during the year. Instead, change it at the start of the next tax year.

You’re done! Sit back and relax

That’s it! There should be nothing else you need to do to finalise payroll year end. Your payroll accounts should now be in good shape for the new financial year. Any pay runs with a payment date on or after 1 April 2024 will fall within the new financial year.

In the meantime, check out Xero Central for more information on how to prepare payroll for the new financial year. Our friendly support team is also available if you need a hand.

The post Four steps to a seamless payroll year end with Xero Payroll appeared first on Xero Blog.

If Xero is of interest and you'd like more information, please do make contact or take a look in more detail here.

Credit: Original article published here.