Attorney analysis of Xero's subscription agreements and liability terms
Xero offers solid cloud accounting with a strong integration ecosystem, but complex tiered pricing and severely limited liability are concerns.
Xero is a New Zealand-based cloud accounting platform popular with accountants and small businesses worldwide. The service offers strong bank integrations and a large app marketplace. Terms are standard for the industry, though the tiered pricing can be confusing.
Xero integrates with over 1,000 third-party apps, making it highly extensible for specialized business needs without vendor lock-in to proprietary add-ons.
Each tier has specific limits on invoices, bills, and bank reconciliations. The Starter plan limits you to 20 invoices/quotes and 5 bills per month - very restrictive for active businesses.
Xero's liability is capped at 12 months of subscription fees. For a $50/month plan, that's just $600 maximum recovery regardless of actual damages.
Unlike client-based limits, Xero limits by transaction volume. This can be harder to predict and may require mid-cycle upgrades.
Like all accounting software, Xero disclaims liability for calculation errors, tax filings, and financial decisions made based on reports.
Xero allows comprehensive data export in standard formats, making migration to other platforms relatively straightforward.
A full 30-day trial with all features lets you evaluate the platform thoroughly before committing.
Xero's pricing tiers restrict functionality in ways that may not be obvious when signing up. Understanding these limits is crucial for budgeting.
The Starter plan ($13/month) allows only 20 invoices/quotes and 5 bills per month. Most small businesses exceed these limits quickly, requiring an upgrade to Standard ($37/month) or Premium ($70/month).
If you're facing billing disputes or tier upgrade issues with Xero, schedule a consultation.
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