How to Use Xero Project Management feature?

Xero Projects is a job-costing and time-tracking feature that helps you manage project profitability. It allows you to track expenses, record time, invoice clients, and monitor performance against budget—all directly within Xero.

Xero Projects helps businesses track the time and money spent on individual jobs or clients. You can record project-related costs, assign staff time, generate project-based invoices, and see profit margins in real time.

Xero Projects is available as an add-on in most regions. Pricing may vary depending on your Xero plan and country. Typically, it costs around USD $7–10 per month for the first user, with an additional fee for each active team member using the feature. Check your local Xero pricing page for exact rates.

Only users with Adviser or Manage Users access can activate and manage the Projects feature. Standard users can view or enter project data only if permission is granted by an administrator.

Step 1: From the dashboard, go to Projects, choose All Projects.

Step 2: Click New Project, choose either Draft or In Progress.

Step 3: Enter the Contact Name, Project Name, Deadline, Estimate and choose who can view the project.

Step 4: Click Create.

Your project will now be available for assigning costs, time, and generating invoices.

Step 1: From the dashboard, go to Projects, choose All Projects.

Step 2: Click reports and choose the specific report you want to view:

Project Summary Report – shows total income, expenses, and profit per project.

Project Financials – Displays detailed financial data including costs, invoiced amounts, and profit margins.

Project Details Report – lists all time entries, materials, and expenses logged for each project.

Unbilled Items Report – displays all costs that have not yet been invoiced to the client.

Step 3: Adjust the filters (e.g., project name, date range, or project status) as needed to refine the report.

Xero Projects lets team members record hours spent on each project either manually or using the built-in timer. These time entries can be assigned a billable or non-billable rate. Once approved, billable hours can be added directly to an invoice, ensuring all time is accurately recovered.

Step 1: From the dashboard, go to Projects, then select Time Entries.

Step 2: Click New Time Entry.

Step 3: then enter the Project, Task, Description, Hours worked, and Date. Click Save to record the entry.

Alternatively, you can use the Timer feature for real-time tracking.

Step 1: From the dashboard, go to Projects, then select Time Entries.

Step 2: Click Timer.

Step 3: Press Start to begin tracking, and Stop when finished. Then, click Save.

Step 4: Fill in the details, then click Save — the total time will be filled in automatically.

Project managers can review recorded time under each project. To get a detailed breakdown:

Step 1: From the dashboard, go to Projects, choose All Projects.

Step 2: Go to Reports and select Detailed Time Report

Step 3: You can edit entries before they’re added to invoices.Use filters to view entries by date, staff, or project.

Once all billable time and expenses are recorded in Xero Projects, you can easily create an invoice to recover those costs from your client. This ensures all project-related work is accurately billed and reflected in your financial records.

Step 1: When you’re ready to bill, open the project and click Create Invoice. Choose Tasks & expenses.

Step 2: Select the billable tasks and expenses you want to include. Then, click Save and open draft invoices.

Step 3: The draft invoice will show the billable expenses in the lines.

After reviewing, you can approve and send the invoice to your customer — ensuring you get paid promptly for your project work.

Q: Can I use Xero Projects on any pricing plan?

A: Xero Projects is included in some premium plans but must be added as a paid add-on for standard plans. Check your subscription details to confirm.

Q: Can I restrict who sees or edits projects?

A: Yes. Administrators can control user access by enabling or disabling the “Projects” permission in user settings.

Q: Can I link expenses and bills directly to a project?

A: Absolutely. When entering a bill or spend money transaction, use the Assign to Project option to tag it to the relevant project.

Q: How do I invoice project work?

A: Once time and expenses are recorded, go to the project and click Create Invoice. You can choose which items to include and send it directly to the client.

Q: What happens when a project is completed?

A: You can mark it as Closed once all invoices and payments are finalised. The data remains in Xero for reporting and audit purposes.

Q: Can I export project data?

A: Yes. Project reports can be exported to PDF or Excel for analysis or sharing with stakeholders.

Q: How often is project data updated?

A: Project data updates automatically in real time as you post bills, timesheets, or invoices related to that project.

The Xero Projects feature streamlines project management by integrating job costing, expense tracking, and billing into one system. With proper setup and permissions, you can easily track performance, recover costs, and analyse profitability—helping your business make data-driven decisions.