The How

Financial settings control how Xero handles dates, tax, and reporting for your organisation. Getting these right early on saves time and prevents errors in your reports.

Note: The settings shown here are for a global Xero edition. Other regions may look slightly different, but the concepts are the same. Check Xero Central for region-specific guidance.

1. Navigate to Financial Settings

Click Accounting in the main menu and select Advanced. Then click Financial settings.

2. Set Your Financial Year End

Your financial year end should match what your tax authority has on record for your business. It determines the date range used in reports like the balance sheet.

If Xero selected a date automatically, verify it against your prior financial statements. If it's wrong, click Change and enter the correct date.

3. Configure Tax Information

Accurate tax settings ensure sales tax is reported correctly:

• Tax period — how often you're required to submit a tax return. If you're unsure, ask your accountant or bookkeeper.
• Default tax settings — set defaults for how tax is applied to sales and purchase transactions:
  • Based on the last transaction
  • Tax inclusive
  • Tax exclusive
  • No tax

4. Set Lock Dates (Optional at This Stage)

Lock dates prevent users from adding or editing transactions dated on or before the lock date. You don't need to set these yet — you'll revisit lock dates once your conversion balances are entered.

5. Set Your Time Zone

The time zone drives the date and timestamp on all transactions. This lets you see exactly when users log in or make changes. Select your local time zone from the dropdown.

6. Save Your Settings

When you've reviewed and updated everything, click Save.