Xero review: is it worth it?

What it does

Xero handles bookkeeping, invoicing, bank reconciliation, VAT returns under Making Tax Digital, and payroll via add-ons.

What I use it for

Day-to-day bookkeeping and keeping records clean enough that tax relief claims are straightforward to evidence.

Why I use it

Clean books make everything downstream easier — including checking whether you qualify for reliefs you have never claimed.

Key features

• Bank feeds and reconciliation
• Invoicing and quotes
• MTD VAT submission
• Payroll add-on
• Expense claims
• Reporting
• Large app marketplace

Pros and cons

Who it's best for

UK small businesses that want tidy books their accountant can work with.

Who should avoid it

You need heavy inventory or complex project accounting out of the box.

Pricing

UK plans from roughly £15/month, rising with payroll and higher transaction volumes.

There's no meaningful free plan — budget for it from day one.

Alternatives to Xero

• QuickBooks — Cloud accounting software with strong self assessment and small business features in the UK.