Assign Billable Expenses: How to Bill Customers for Expenses in Xero

As a small business owner, you know that keeping track of expenses is essential to maintaining a healthy bottom line. But when you perform services for clients, it can be tricky to pass on expenses related to those services. Luckily, Xero has a solution: the Assign Billable Expense function.

Xero’s Assign Billable Expense function allows you to track expenses that you incur on behalf of a customer or client and then pass those expenses on to the customer by billing them for the expenses. This helps you keep your invoicing process organized and ensures that you are accurately tracking your expenses and revenue.

Here are the simple steps to use the Assign

Billable Expense function in Xero:

1. Create a new bill in Xero for the expenses you want to assign as billable.

2. Click on the “Options” button at the bottom of the bill and select “Assign to a Customer or Project”.

3. Select the customer or project you want to assign the billable expenses to and click ok.

4. Approve the bill, and Xero will track the billable expenses and associate them with the customer or project you assigned them to. You can see the billable expense note right below the description of the item.

5. Create a new invoice in Xero and select the customer or project you assigned the billable expenses to. The billable expenses will automatically appear as line items on the invoice.
(Note: If the billable expense did not show up, you may re-login into Xero to trigger the prompt)

6. Click on the billable expense, then select the item assigned to customer and click on ‘Add as one item’

7. Review and send the invoice to the customer. Xero will automatically apply the payment to the billable expenses when the customer pays the invoice.

Here’s an example with pictures of how to create

Assign Billable Expenses in Xero:

1. Create a new bill in Xero for the expenses you want to assign as billable.

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2. Click on the “Options” button at the bottom of the bill and select “Assign to a Customer or Project”

3. Select the customer or project you want to assign the billable expenses to and click ok.

5. Create a new invoice in Xero and select the customer or project you assigned the billable expenses to. The billable expenses will automatically appear as line items on the invoice.
(Note: If the billable expense did not show up, you may re-login into Xero to trigger the prompt)

6. Click on the billable expense, then select the item assigned to customer and click on ‘Add as one item’

7. Review and send the invoice to the customer. Xero will automatically apply the payment to the billable expenses when the customer pays the invoice.

By using the Assign Billable Expense function in Xero, you can easily track and bill your customers for expenses that you incur on their behalf. It’s a simple and efficient way to manage your invoicing process and accurately track your expenses and revenue.

At MKG Partners, we highly recommend using the Assign Billable Expense function in Xero. It’s a great way to accurately track expenses and revenue while making your invoicing process effortless. If you need help setting up Xero or any other accounting-related tasks, don’t hesitate to contact our team of experts. Give the Assign Billable Expense function a try and see how it can help make your life easier!