Set up your organization's financial details
Your financial settings include information used to produce your reports, invoices and bills.
The financial information you're asked to provide is used in the production of financial reports and print versions of invoices, bills and credit notes so for these to generate accurately you will need to enter the information asked for on this screen. If you are unsure about the financial information asked for, you might like to wait until you have consulted your accountant or bookkeeper.
Your user role determines if you can access your organization's financial settings.
Settings role comparison
- Choose your financial (fiscal) year end
- Choose your sales tax settings
- Set a tax default for sales or purchases
- Use lock dates to close off your accounts for a period or year end
- Time zone setting in Xero
Xero sets a default fiscal year-end for your organization: December for a fiscal year that runs from January 1 to December 31.
Most organizations set their fiscal year-end to align with their tax year-end.
Changing your fiscal year-end date impacts your balances, reports and fixed assets. Avoid changing it if you’ve already set Xero up for your organization and entered your conversion and comparative balances.
Changing your fiscal year-end date has considerable impact on fixed assets. If you use fixed assets in Xero, you'll need to take extra steps before changing the date.
- From the Settings menu, select General Settings.
- Under Organization, click Financial Settings.
Under Financial Year End, click Change.
- Choose your fiscal year-end date.
- Click Done.
Tax ID Number - enter this number if you need to file or produce sales tax reports and have some kind of registration or identification number from your tax authority, or you need a tax reference number to display on your invoices and reports.
Tax ID Display Name - if you've used a tax ID number, this field is the 'label' or description next to the number that identifies the number on your invoices and reports. These fields are optional but if you enter a tax ID number, you'll need to enter a tax ID display name.
Tax Period - the frequency you review or submit a sales tax report. The report automatically generates the amount of tax charged or paid during the period.
Tax Basis - choose Cash or Accruals Basis. You need to complete this field so the Xero can generate the Sales Tax Report.
- Cash basis. You report income when you receive payment and report expenses when you pay your supplier. The report is run based on the date you made or received payments for invoices, bills and expense claims and the date you entered spend or receive money transactions in your bank account.
- Accruals basis. You report income when you create the invoice and expenses when your supplier bills you. The report is run based on the invoice date or in the case of expense claims, the Reporting date. All other reports in Xero are based on the actual transaction date. For example, spend or receive money date, invoice date, expense claims reporting date.
Lock dates stop any changes to data entered before that date. Only users with the Advisor user role can view, set and change either lock date.
The time zone setting in Xero determines the date and time shown for those items that are time-tracked. For example, when a user logs in. Xero also uses the time zone setting for time-stamping all actions recorded in History & Notes.
Xero uses your computer's clock to determine what the current date is when entering any transactions or running reports that default to today's date. For example, entering the date on an invoice, or running the Balance Sheet report as at today's date.
The time zone is set to Eastern Time (US and Canada) by default but you can change it.