Published on the 05/06/2013 | Written by Newsdesk
Accounting software cloud provider Xero will release the first modules in its tax package later this month that will allow accountants to file tax file number applications and BAS statements online…
A cloud-based tax package which will allow accountants and book-keepers to lodge key documents including their clients’ Business Activity Statements (BAS) directly with the Australian Tax Office will debut as a beta version later this month. Listed NZ-based cloud services business Xero, which was founded in 2006, has grown rapidly on the back of small business users who are being encouraged to adopt the software by their accountants or book-keepers.
Chris Ridd, managing director of the company’s Australian operations, said Australia now represented the company’s fastest growing division worldwide with a 220 percent revenue surge in the last financial year.
The company claims that of 157,000 customers worldwide, 50,000 are Australian (the company claims to be adding 200 new customers each business day). But Ridd acknowledged that as there are about 1.2 million small businesses in Australia, which could benefit from Xero’s software, the company as yet controls only a very small market-share. Incumbents such as Reckon and MYOB still command the lion’s share of the market.
Xero also has yet to turn a profit. Although revenues for the year to the end of March jumped from NZ$19 million in 2011/12 to NZ$39 million in the year to the end of March 2013, the company also reported losses which had blown out from NZ$7.9 million to NZ$14.4 million. Ridd said that reflected the start-up nature of the business, and the fact that it was investing heavily in acquisitions and development – such as the R&D programme for an Australian tax package. Despite the losses it has secured the support of big-four accounting practice Deloitte, which in April started offering its clients the opportunity to move ledgers to Xero.
As a further enticement for accountants Xero last week unveiled Practice Studio, its suite of cloud-based software intended to provide an integrated platform through which they can manage their clients’ accounts. Practice Studio includes a practice management tool, a work papers tool (used for generating annual reports and the like) and will include the tax package once it emerges from beta tests. Ridd said that Xero’s silver partners (those accountants who have successfully introduced 25 or more of their clients to Xero’s software) would be able to access Practice Studio for free.
Additional modules planned for Practice Studio include company returns, trusts and individual tax returns, said Ridd.
