Xero accountant and bookkeeper in Fulham

Why cloud accounting helps a small business

With cloud software, your bank transactions arrive automatically each day, your invoices are raised in the same place your payments are recorded, and your accountant can log in to check something without asking you to send anything. Records are not stuck on one laptop in a back office.

For many of the businesses we work with, from design studios in Sands End to shops around Fulham Broadway, the biggest change is simply knowing where they stand on any given day. The second change is time saved. Matching a bank line to an invoice that already exists takes seconds.

Setting Xero up properly

Xero is easy to start but easy to set up badly. A chart of accounts with dozens of vague categories, VAT rates left on the defaults, or bank rules that guess wrongly can produce figures that look fine and are quietly wrong for months.

We set up the chart of accounts around your business, connect your bank and card feeds, set VAT correctly for your scheme, and create invoice templates with your details. We also set up bank rules for regular payments such as rent, software and utilities, and check them after the first month so they are doing what we expect.

• Chart of accounts that fits your trade
• Bank and credit card feeds connected
• VAT settings that match your registration
• Invoice templates and payment reminders
• Bank rules checked after the first month

Moving from spreadsheets or other software

Most moves happen at the start of a VAT quarter or a financial year, because it keeps the cut off clean. We bring across opening balances, unpaid customer invoices and unpaid supplier bills. Full transaction history can sometimes be brought over too, though for many businesses opening balances and a saved copy of the old records are enough.

If you are moving from desktop software, a spreadsheet or a paper cash book, we check that the closing figures in the old records match your bank before anything is moved. Moving errors across only makes them harder to find later.

Receipts, invoices and getting paid

Receipt capture tools let you photograph a receipt or forward a supplier email, and the details are read and attached to the transaction. That ends the shoebox at the end of the year, and it gives HMRC the digital record it expects.

On the sales side, Xero lets you send invoices with an online payment link and automatic reminders. For a trade business or a consultant who struggles to chase late payers, that alone can bring cash in sooner.

Common Xero mistakes we put right

The one we see most is the reconcile button pressed on a suggested match without checking it. Xero suggests matches based on amounts, so two invoices for the same figure can easily be confused. Over a year, a few wrong matches leave customers showing as unpaid when they paid long ago, and others showing as paid when they still owe you.

Duplicate transactions are another. If the bank feed drops and someone imports a statement by hand, the same payments can appear twice. VAT codes are a third. A cost from a supplier who is not VAT registered coded at the standard rate means you claim VAT that was never charged, which HMRC will ask you to repay if it checks your return.

None of these are hard to fix once they are spotted. We look for them in every new file we take on, and our quarterly checks before each VAT return are designed to catch them early.

Xero and Making Tax Digital

VAT registered businesses must keep digital records and file VAT returns through compatible software, and Xero can send VAT returns directly to HMRC. For sole traders and landlords coming into Making Tax Digital for Income Tax, we check that your Xero plan covers the quarterly updates you need before you commit to it.

Xero is not the only good option. If another product suits you better, for example a simpler tool for a landlord with one property, we will say so.

Training and ongoing support

Once Xero is running, we show you the parts you will use every week: reconciling the bank, raising an invoice, adding a bill and finding the reports you care about. We keep it practical and short, and we write down the steps for anything you do only once a quarter.

After that, you can take on the day to day work yourself with us checking it, or hand all of it to our bookkeeping service. Either way, we review the file before each VAT return and at the year end. Fees are fixed and agreed before any work starts, after a free review of your current records. We act for businesses across Fulham, Chelsea, Hammersmith and Putney, and the work is done online so location rarely matters.

Common questions