From 12 September 2024, Xero is making changes to their Xero plans by launching three new Business Plans, enhancing the Ultimate Plan and reducing their Partner Plans down from three to two. These plans will replace the current plans and subscribers who sign on from this date as well as subscribers wishing to upgrade or downgrade their plans will only be able to choose one of the new plans.
The new Business Plans are:
- Xero Ignite plan: Accounting basics made for businesses starting out
- Xero Grow plan: Accounting tools for self-employed and growing businesses
- Xero Comprehensive plan: Streamlined accounting and payroll for businesses with employees
- Xero Ultimate plan (enhanced): Accounting, payroll and forecasting tools to help businesses scale for future growth
In addition, Xero are changing what they call their ‘partner plans’ which are the plans with minimal functionality accountants tend to use inhouse, and clients who are GST registered but don’t do any invoicing through Xero tend to use the GST Cashbook plan for doing their GST returns.
The new Partner Plans are:
- Xero Ledger: Annual tax basics to help prepare and submit annual tax returns for non-trading clients
- Xero Cashbook: Bookkeeping essentials for non-GST-registered clients
What else is changing?
The biggest changes are
- Pricing of most plans are changing from 12 September 2024
- Addons – for people who use add-ons (Expenses, Payroll, Projects, Analytics Plus) which were previously able to be added separately to a base subscription. These are now being bundled with different levels of subscriptions which may result in the need to upgrade to a higher plan.
For example: The Starter Plan at $35 + GST per month previously offered the ability to add Xero Payroll for 1 person for $10 + GST per month, and $1 + GST per month for additional people.
The comparibly priced new plan called ‘Ignite’ no longer offers this as an addon. Instead subscriptions will need to be upgraded to the new Grow plan at $75 + GST per month.
3. The other big change is the removal of the GST Cashbook plan which will no longer be sold by Xero. This will mean that GST registered entities who have been on the GST Cashbook plan and still wish to prepare and file their GST returns through Xero will needing to upgrade to the new Xero Ignite plan.
New plans overview – see an overview of the new plans here.
New plans comparison – Xero have also published a useful old vs new plan comparison document which you can access here.
Phased move to new plans
From 12 September 2024:
- New pricing will apply for any plans not impacted by the need to migrate to a different plan
- For those who do need to move to a different plan:
- Xero will begin moving subscribers to the new plans in phases, taking into account their current plan (and any add-ons).
- Xero will provide a minimum of 60 days’ notice before your plan is moved, including any information about the plan they intend to move you to.
- Xero intend to move subscribers to new plans by March 2025. Alternatively, you can choose to move to a new plan now.
- If you want to upgrade or downgrade a plan, or remove an add-on, you’ll need to choose one of the new plans. If you transfer a subscription, the new subscriber will need to choose one of the new plans.
- You can still add employees to Xero Projects and Payroll on current plans until either you choose to move plans, or Xero moves the subscription to a new plan. Any additional usage charges (including in relation to Xero Expenses) will continue to apply.
- Once you’ve moved to a new plan, your previous plan will no longer be available and if you move to a new plan that does not contain your current add-on functionality, you will no longer have access to that functionality
- Xero have said they will provide more details on their migration plan and approach in September 2024.
We can help you with any questions related to the new subscriptons.
Get in touch – we’re here to help.
About Pathfinder Solutions
Pathfinder Solutions advisory team members have either owned or managed businesses, or are investors themselves, so we know first-hand the challenges you face in your world.
Sure we’re Accountants, but the best solutions in business come from focusing on more than just the numbers. Our real-world business experience delivers just that.
