Integrating with Xero accounting via the payroll platform

Available for the following Payroll Plan: Standard, Premium

Glossary

What is a Journal feature?

A journal service is a feature that allows you to connect your accounting software with your payroll platform so that you can capture journal entries in your chart of accounts. If you use Xero for your accounting software and journal service, and Employment Hero for your payroll, you would simply connect Xero with your Employment Hero Payroll platform via the Journal Service integration feature.

What happens after I connect to Xero?

After connecting your Xero and EH Payroll platforms together, and setting up your chart of accounts, you can post payroll journals automatically into Xero upon finalising a Pay Run, cutting the need for manual data import/exports or CSV uploads. You will also notice that with this export feature we format the data to reflect automatically your Xero reporting layouts.

Connecting to Xero

The below premise will walk you through how you can connect your Xero accounting platform with your Employment Hero Payroll platform.

Connect to your Xero platform
  1. Log into your Employment Hero Payroll platform.
  2. Click the   Business Settings menu.
  3. Click the Payroll Settings submenu.
  4. Click the   Integrations button.
  5. Locate the Xero logo and click the Add button.
    Screenshot of employment hero payroll integration software options. down the lefthand side of the screen is a menu of payroll settings. In the main screen panel we have the options shown for company cliodna catering. they are xero, intuit quickbooks, sage 50 cloud, freshbooks and so on.
  6. Click the Connect to Xero button.
    Screenshot of the popup to add xero integration. it reads add xero integration. Integrating with xero will allow you to import your chart of accounts, employee data, tax codes (used for logging payroll related expenses) and tracking categories. You can also export your payroll journal. please refer to the support article for more detailed information. the popup then links to the relevant support article
  7. Click the Allow Access button.
    Screenshot of the xero access page. a white page with the blue xero logo at the top. it asks your payroll wants access to organisation data, and user account information. There are links to the terms of use and privacy policies and a blue allow access button or the option to cancel.
  8. Complete the following fields:
    • Export pay run as:
      • Accounts payable invoice.
      • Journal.
    • Post a draft.
  9. Click the Save button. Screenshot of the popup to add xero integration. it reads add xero integration. Integrating with xero will allow you to import your chart of accounts, employee data, tax codes (used for logging payroll related expenses) and tracking categories. You can also export your payroll journal. please refer to the support article for more detailed information. The popup then links to the relevant support article. below once you have confirmed the company and export pay run data, it shows you are connected.

Import chart of accounts

You can import your Xero chart of accounts and then map them to the various transaction types on the chart of accounts page. You can import your chart of accounts by following these steps. Once you have imported your accounts, you can map them to GL transaction types. You will also notice an Export button in the Chart of Accounts. This allows you to export the chart of accounts setup so that you can better see what you​ have mapped.

Setup Chart of Accounts
  1. Click the Business menu.
  2. Click the Payroll Settings sub-menu.
  3. Click the Chart of Accounts button.
  4. Click the Manage Accounts button.
  5. Click the Import button.
  6. Once on the import accounts page, you will see a list of all the accounts in your cloud accounting service chart of accounts. Tick each account that you​ would like to map to a payroll transaction type
  7. Once you​ have selected all your accounts, click the Save button.
    UK Chart 1.jpg

Configuring your chart of accounts

Once you have imported your accounts, you can map them to GL transaction types. When you map your default GL accounts, you​ will notice that there is an option to Split by location. This allows you to write a transaction line per location to the journal for the same account.

This is particularly useful if you are using locations, classes, or tracking categories within Xero. Rhe Xero API does not allow us to write transactions to a bank account. As such, you have two options:

  1. You can post your payroll info to Xero as a purchase invoice, much like the inbuilt Xero Payroll does now. When you do this, the purchase invoice is reconciled against the bank account transaction and as such, does not need a transaction line written to the bank account

  2. You can post to Xero using a journal. If you do this, you’ll need to create a payroll clearing account that we can post to which you can then use to reconcile against the bank account.

Importing Xero employees

You can use the Employee Importing feature within the Payroll Settings module to import the employee data stored within your Xero platform. Using the Xero Payroll import feature will import the following data: 

  • Employee details.
  • Leave Categories.
  • Pay Categories.

Warning

When using any Xero integration features within the payroll platform, you need to have at least Standard + Payroll admin access on your Xero platform.

Important

If you have used an external Id before, you cannot save ‌this data point if you have enabled the Unique External Id setting. You can read further information on this setting in the following article. The payroll platform does not import leave balances when setting up new employees.

Importing my Xero employees
  1. Log into your Employment Hero Payroll platform.
  2. Click the  Business Settings menu.
  3. Click the Payroll Settings submenu.
  4. Click the Import Employees button.
  5. Select the Xero Payroll option in the Import Employees From drop-down.
  6. Click the Enable this Connection button.
    Xero__UK__1.jpg
  7. Enter your Xero login information and click the Log In button.
    Xero_2.jpg
  8. Enter your 2 Factor Authentication code and click the Confirm button.
    Xero_3.jpg
  9. Click the Allow Access button.
    Xero_4.jpg
  10. Click the Import button.
    Xero__UK__2.jpg

    Helpful Hint

    You will now see on your screen a status message showing the successful uploading of your Xero employee data into your payroll platform.

    Xero__UK__3.jpg

Exporting Pay Run data

You can use the Export to Xero feature to transfer the finalised Pay Run data over to your Xero accounting platform.

Export a finalised Pay Run into Xero
  1. Log into your Employment Hero Payroll platform.
  2. Click the   Pay Run menu.
  3. Click the finalised Pay Run that needs exporting to Xero.
    Screenshot of pay runs with the date range on the left hand side vertical column. the second pay run on the page is highlighted
  4. Click the Actions tab.
  5. Click the   Export to Xero button.
    Screenshot of the details of a pay run with names and earning detailed. along the top is a menu bar with the option to export to xero highlighted in red.

Re-export Pay Run data.

You can use the re-export to Xero feature to transfer the finalised pay run data over to your Xero accounting platform.

Re-export a finalised pay run into Xero
  1. Log into your Employment Hero Payroll platform.
  2. Click the   Pay Run menu.
  3. Click the finalised pay run that needs re-exporting to Xero.
    Screenshot of pay runs with the date range on the left hand side vertical column. the second pay run on the page is highlighted
  4. Click the Actions tab.
  5. Click the   Re-export to Xero button.
    Screenshot of the details of a pay run with names and earnings detailed. along the top is a menu bar with the option to re-export to xero highlighted in red.

Disconnecting from Xero

The below premise will walk you through how to disable your Xero accounting integration.

Disable your Xero connection
  1. Log into your Employment Hero Payroll platform.
  2. Click the   Business Settings menu.
  3. Click the Payroll Settings submenu.
  4. Click the   Integrations button.
  5. Locate the Xero logo and click the   button. Screenshot of employment hero payroll integration software options. down the lefthand side of the screen is a menu of payroll settings. In the main screen panel we have the options shown for company cliodna catering. they are xero, intuit quickbooks, sage 50 cloud, freshbooks and so on. In the xero panel, the no entry icon is highlighted in red. clicking this is the first step in disabling xero.
  6. Click the Disable button. The integration is then disabled. 
    Screenshot of popup to confirm you wish to disable the xero integration. There is a button to disable or the option to cancel.

Error resolution

Your Xero account is already linked to a payroll and therefore is not available to select

If you receive this error message, then you need to within Xero, go to Settings Connected apps for Business Name here, and then disconnect the related app currently connected to the business.

Further information

Can I write transactions to my Xero bank account?

The Xero API does not allow us to write transactions to a bank account. You have two options:

  • You can post your payroll info to Xero as a purchase invoice, much like the inbuilt Xero payroll does now. When you do this, we reconcile the purchase invoice against the bank account transaction and do not need a transaction line written to the bank account.
  • You can post to Xero using a journal. If you do this, you will need to create a payroll clearing account that we can post to which you can then use to reconcile against the bank account.

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