Xero is an online accounting platform used widely in the UK, Australia, New Zealand, and increasingly elsewhere. Business owners and bookkeepers connect their bank accounts so transactions flow in automatically, then match them to invoices and bills in a reconciliation process that Xero makes quick with suggested matches. It generates invoices, tracks expenses and cash flow, and produces reports such as profit and loss and balance sheets.
An accountant-friendly design is part of its appeal. Unlimited users on most plans let owners, bookkeepers, and accountants work in the same file, and a large marketplace of integrations connects Xero to payment providers, payroll, inventory, and point-of-sale systems. AI features include suggested coding of transactions, predictive cash flow tools, and an assistant for asking questions about the business and automating tasks like drafting invoice reminders.
Xero is sold by monthly subscription in tiers based on transaction volume and features, with a free trial. Specific capabilities, like payroll and tax compliance, depend on country. QuickBooks is its main competitor, particularly in the United States, FreshBooks serves freelancers, Wave offers a free option for tiny businesses, and Sage and Zoho Books are other alternatives. Xero suits small businesses that value an accountant-ready, cloud-first system.