Xero plans and what you can post

1. Which plan you are on

Xero’s current UK plans are Simple, Ignite, Grow, Comprehensive, and Ultimate. Rent Logger does not have a separate Access plan. An organisation still on an older Standard or Premium subscription is treated the same as Grow.

• The Posting tab shows the plan name and whether the organisation is VAT registered. The posting method is locked to the option that plan can use.
• Comprehensive and Ultimate post the same way as Grow. Their extra Xero tools, such as payroll and expenses, are not required by Rent Logger. Which plan fits a portfolio is covered at the end of this guide.
• Ledger, Cashbook, and Lite organisations cannot post invoices, bills, or journals. A Xero trial or demo organisation can change when the trial ends. A partner-edition organisation can be more restricted than the plan name suggests.
• Xero publishes the current limits on Xero pricing plans. Invoices created by an app count toward the Simple and Ignite allowances.

2. Invoice generation

Rent invoices, holding-deposit invoices, and other sales invoices are approved sales invoices in Xero. They share one monthly allowance with every other approved sales invoice on that organisation, including the income invoice on an agent statement.

• Simple allows 10 sales invoices a month. Ignite allows 20. Grow, Comprehensive, and Ultimate have no monthly invoice cap in Rent Logger.
• Bills are separate. Supplier and expenditure bills, and the deduction bill on an agent statement, share the bill allowance. Simple cannot create bills. Ignite allows 10 bills a month.
• On Ignite, the bill allowance is usually the one that runs out first. One agent statement with fees uses one sales invoice and one bill. Ten statements with fees use the whole bill allowance, even if sales invoices remain.
• When Xero rejects a post because the allowance is used, Rent Logger reports a subscription limit. Further invoices or bills wait until the allowance resets, or until the organisation is upgraded.
• Spend Money, Receive Money, and loan postings are bank transactions. They do not use the invoice or bill allowance. Manual journals, used for some deposits and for personally paid expenditure, are not available on Simple.

3. Agent statements

There are two posting methods. Rent Logger selects one from the organisation’s plan and VAT registration. You do not pick a different method per statement.

Invoice and bill, paid through a clearing account

This is the method on Ignite, Grow, Comprehensive, and Ultimate. It is the one to use.

• Rent Logger creates an approved sales invoice for the income, coded to the income accounts.
• It creates an approved bill for the agent’s fees and other deductions, coded to the expense accounts.
• Both documents are marked paid against the agent statement clearing account, so the gross income and the fees do not sit as money the agent owes or is owed.
• It then creates a Receive Money transaction on the real bank account for the net amount the agent pays you, coded back to that same clearing account. If the agent recovers a net amount, the bank movement is the other way. Leave it unmatched until the bank-feed line arrives.

The clearing account is what makes the three documents agree. The invoice and the bill carry the gross figures and the VAT. The bank shows only the net payment. When the feed arrives, you match one line and the clearing account returns to zero for that statement.

Bank transaction

This is only used on Xero Simple when the organisation is not VAT registered. Rent Logger creates one Receive Money or Spend Money transaction. Income and deductions are lines on that single transaction. There is no sales invoice and no bill.

• A bank transaction is an accounting record. It is not a VAT invoice.
• It does not put output VAT or input VAT onto a Xero VAT return. If you later need to reclaim VAT on an agent’s fees, you still need a valid VAT invoice from the agent.
• Ignite and above do not offer this method. Those plans use invoice and bill.

4. VAT

Rent Logger reads VAT registration from the Xero organisation. It does not turn VAT on for an organisation that Xero says is not registered.

• On invoice and bill, amounts are posted exclusive of VAT. The tax code on each income and deduction line is what Xero uses for the VAT return. That is why a VAT-registered organisation should be on Ignite or above.
• Xero Simple cannot submit a VAT return. If that organisation is VAT registered, Rent Logger will not post the agent statement at all. Upgrade to Ignite or above before you post.
• On the Simple bank-transaction method, every line is posted with no VAT. The statement can still be recorded, but it does not create a VAT invoice in Xero.
• Expenditure bills and supplier credit notes use the same VAT registration. A bill with VAT needs a plan that can create bills. Simple cannot.

5. Plan matrix

Grow and above means Grow, Comprehensive, Ultimate, and an older Standard or Premium organisation. Limits are per Xero organisation, per month, and include documents created in Xero as well as documents Rent Logger posts.

6. What Rent Logger recommends

Count the tenancies in that Xero organisation, not every property on the Rent Logger account. A house let as one tenancy is one invoice. An HMO is one invoice per room. The figures below assume monthly billing, which is the usual setting, and leave a little room for a new tenancy, a deposit invoice, or a bill you raise in Xero yourself.

• Choose Simple only when the organisation is not VAT registered, you do not need bills, and monthly sales invoices stay under 10. That suits a small self-managed or guaranteed-rent portfolio. It does not suit the recommended agent-statement method.
• Choose Ignite when the organisation is VAT registered, or when agent statements should post as an invoice and a bill through the clearing account. The 10-bill allowance is the limit that matters: about 8 monthly statements leaves room for a couple of supplier bills. Twenty sales invoices is enough for about 16 monthly tenancies.
• Choose Grow when a single organisation will post more than that, when agent statements and repair bills share the same month, or when the portfolio is still growing. Comprehensive and Ultimate do not raise these posting limits.
• Weekly rent uses the sales-invoice allowance about four times faster, so Simple fits about 2 tenancies and Ignite about 4. Quarterly billing uses it more slowly, so a larger portfolio can stay on a lower plan.
• Short-let statements are often more than one per property per month. Count the statements you expect to post, not the number of properties. Each one with fees uses a bill.