Xero Integrates Small Business Accounting and Payroll

By Pedro Hernandez | Posted January 22, 2015

Xero now offers its cloud-based small business accounting and payroll software solutions as one integrated product in the U.S. but there's catch; it's currently available only in California, Florida and Texas.

"We know that running a small business is easier when you combine accounting and payroll," Jamie Sutherland, president of Xero U.S. told Small Business Computing. And it's not just a gut feeling.

Xero is no stranger to payroll. In late 2013, it released its Xero Payroll product which, at the time, Sutherland described as "one of the biggest launches to date" for his company. Across the globe, the company estimates that its payroll software and service slate processes billions of dollars for tens of thousands of customers each month.

In Australia, businesses already enjoy the benefits of one system that handles both a firm's finances and payroll. In that country, the platform handles $1.5 billion (AU) worth of payroll transactions, covering more than 375,000 employees, each month.

small business accounting and payroll service

Xero offers a new service that combines both small business accounting and payroll capabilities.

Now, Xero takes a major step forward by blurring the lines between its small business accounting and payroll products for small businesses on U.S. shores.

Two Financial Services, One Price

Xero's integrated accounting and payroll solution starts at $30 for five employees and unlimited users (currently half-off for six months and for a limited time). It's an "all-in-one solution," not a blend of optional add-ons that can quickly drive up the price, said Sutherland.

His company also focused on creating a consumer-like experience, keeping the complex, behind-the-scenes operations out of sight. This lets entrepreneurs manage two of the most critical aspects of their businesses without requiring specialized accounting skills.

The goal, he said, was to "make it a super easy and beautiful experience," at least when it comes to balancing the books and getting employees paid.

Current Xero accounting customers will feel right at home with the mobile-friendly, user-centric interface they're accustomed to. A new payroll tab integrates with the general ledger and handles timesheets, vacation accruals and direct deposit, to name a few of the platform's payroll-related capabilities. Conversely, payroll activities will be reflected in the accounting section, giving real-time insights on the effects of labor costs on a company's bottom line.

Making Small Business Taxes Less Taxing

Taxes are breeze, boasted Sutherland. Small business customers can "file and pay [their] federal taxes and state taxes with a click of a button," he said.

Xero's tax experts know the ins and outs of tax laws and jurisdictions. "Now you never have to worry about tax deadlines. It's just going to be done correctly, depending on where your employees' location." If issues arise, the company's customer support centers in San Francisco and Denver are just a call away.

Sutherland also promised "superior uptime, because we're designed and built for the Web." The Xero platform currently has a "four nines" availability rating, which translates to 99.99 percent uptime—or less than an hour of downtime each year.

Finally, self-service capabilities let workers access and track their payroll information through an employee portal.

The integrated accounting-payroll solution has been switched on for California, Florida and Texas, the country's "three top employer states," according to the company. More states are on the way.

Rod Drury, CEO of Xero said in a statement that Xero is "building on the recent acquisition of Monchilla in the U.S. and the scaling of our development teams globally." Monchilla's payroll platform covers all U.S. states and territories. "This is the start of a wave of product innovations launching early this year. These innovations will deliver on our vision of a fully integrated platform for small businesses to work and collaborate on," he added.

Pedro Hernandez is a contributing editor at Small Business Computing. Follow him on Twitter @ecoINSITE.

Do you have a comment or question about this article or other small business topics in general? Speak out in the SmallBusinessComputing.com Forums. Join the discussion today!

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