Tracking Expenses in Xero: A Step-by-Step Guide for Tradies

“"Receipts piling up faster than sawdust? Let’s sort that out—no dramas, no mess."

Are you a tradie drowning in receipts and struggling to track expenses? Mate, this tutorial is for you.

Xero makes managing your business expenses simple, organized, and stress-free.

Tracking your costs might seem overwhelming, but this guide will walk you through it step by step.

Invoicing is a vital part of any trade business. Whether you’re a builder, plumber, or electrician, sending professional invoices quickly and accurately ensures you get paid on time and keeps your cash flow healthy. This step-by-step guide will show tradies how to create and send invoices in Xero with ease.

Step 1: Log In to Xero

1. Go to Xero and log in to your account.

2. Navigate to the dashboard to access your bookkeeping tools.

Step 2: Navigate to the “Bills to Pay” Section

1. From the dashboard, click on “Business” in the top menu.

2. Select “Bills to Pay” from the dropdown.
   This is where you’ll record and organize your business expenses.

Step 3: Add a New Expense

1. Click the “New Bill” button in the top-right corner.

2. Enter the following details:

   • Supplier: Choose an existing supplier or add a new one (e.g., hardware stores, fuel providers).

   • Date: Enter the date of the expense.

   • Due Date: If it’s an invoice, include the payment deadline.

   • Reference: Add details like the invoice or receipt number for easy tracking.

Step 4: Itemize Your Expense

1. In the Item Description section, specify what the expense was for. Examples include:

   • Tools and equipment

   • Materials for a job

   • Vehicle maintenance or fuel

2. Enter the quantity and price for each item.

3. Xero will calculate the total, including GST if applicable.

Step 5: Upload a Receipt or Invoice

1. Click “Attach File” to upload a digital copy of the receipt or invoice.

2. Use your phone to take a picture if you don’t already have a digital copy.
   Tip: Keeping receipts attached helps you stay organized and ready for tax time.

Step 6: Review and Save

1. Double-check all the details for accuracy.

2. Click “Approve” to save the expense to your records.

Step 7: Reconcile Expenses with Bank Transactions

1. Go to the “Bank Accounts” section in Xero.

2. Match imported bank transactions with the corresponding expenses you’ve recorded.

3. Mark each transaction as reconciled.
   This step ensures your books are accurate and complete.

Pro Tips for Tradies:

• Track Expenses Daily: Record expenses as soon as they happen to avoid falling behind.

• Separate Personal and Business Expenses: Use a dedicated business account to keep everything clean and compliant.

• Set GST for Each Expense: Ensure GST is applied correctly for deductions.

Conclusion

Tracking expenses in Xero keeps your trade business running smoothly and ensures you’re prepared for tax time. By following these steps, you’ll stay organized, reduce stress, and maximize your deductions.

Need help managing your expenses or setting up Xero? Contact Contigo Accounting today for a free consultation. We’ll handle the hard yakka—too easy!

Checklist: Creating and Sending Invoices in Xero for Tradies

Here is a quick checklist to get you started with you website blow. Remember imperfect action beats inaction, get started and keep publishing.

• Log in to your Xero account.

• Navigate to the “Bills to Pay” section.

• Click “New Bill” to record a new expense.

• Enter supplier details (or add a new one).

• Specify the expense date and due date (if applicable).

• Add a description of the expense (e.g., tools, materials, fuel).

• Enter quantities, unit prices, and GST details.

• Upload a receipt or invoice for the expense.

• Review the details and approve the bill.