Note that to use this integration, your company must have a legal entity based in the UK. 🇬🇧

This article explains how to prepare and set up the integration with Xero Payroll. Xero is a cloud-based accounting software, which includes payroll services. It's recognized by the HMRC. With Xero Payroll, you can administer your payroll processes effectively.

You can sync the following data with the Xero integration:

• Employee data (personal data, employment data, national insurance data)
• Creation of an employee in Xero from Personio via the integration
• Fixed salaries
• Salaries and compensations (one-time and recurring compensations)
• Payment method information
• Personio time off to Xero Leave (paid vacation, unpaid vacation, sick leave)

The integration doesn't support the following:

• The sync of bonus payouts
• The sync of hourly workers
• Termination of employment 
• The sync of hourly time off

Before you start

To make sure your Personio account links to the correct Xero account, you need to authorize the integration. To do this, you need specific permissions.

Personio:

• Edit rights for Payroll
• Edit rights for Payroll configurations

In Xero:

• The person authorizing the integration must be the payroll admin in Xero.

Prepare your account and complete attributes

Prepare your Personio account

Your account requires compatible attributes to successfully transfer data between Personio and Xero. To book the Xero integration directly in Personio via the Marketplace, follow these steps:

1. Go to the Marketplace in the navigation bar.
2. Search for Xero.
3. Click Book integration.

Once you request the integration via our Marketplace, our Customer Operations team helps you check your current attribute set and add all missing fields to your account. The team creates missing attributes for all employee profiles in the section Xero UK.

After completing the attribute setup, the Customer Operations Team enables the integration for your account. 

Complete the attributes

You must complete all attributes before using the integration. You have two options to complete any new attributes added to your account:

• Manually complete all attributes
• Complete all attributes using the import template located at the bottom left of this page. Learn how to import employee data.

When filling in attributes, you need to define which employees to consider in the sync. Pay close attention to the following two attributes. They define whether an employee is considered in the sync and under which identifier:

1. Include in UK Payroll: Set the attribute to Yes for all employees whose data must be transferred with the integration. Set it to No for any employees to exclude from the sync.
2. Email: Serves as a unique identifier between the two systems and ensures the correct matching of employee data during the sync.

Note:
▶ ︎Before syncing data, all employees in Xero must have email addresses. The integration uses email addresses to link employees between Personio and Xero. Email addresses must exist in both systems and must match. 
▶ If you rehire former employees, you can use the rehire feature. This transfers all employee data from the inactive employee profile to the new one. Note that Xero rejects rehired employees if their old employee profile is archived. To ensure a smooth integration, you must either provide a new email or change the email used on the previous records in Personio and Xero. You must change the Payroll ID to one that you haven't used previously for this employee. (The integration uses the Payroll ID to distinguish employments with HMRC.)

Understand validations

To maintain high data quality and ensure seamless compatibility across systems, Personio includes data validations for specific attributes. These validations act as checks to verify if the provided values match the expected format. Should a discrepancy arise, error notifications appear either in the employee profile or within the Payroll Xero integration. 

Understand the Contracts for employment section

Xero recently introduced a new section named Contracts for employment. The integration now supports:

• Employment status: Employee
• Contract types: Full-time, part-time, fixed-term contract

Personio determines the contract type for each employee using existing attributes:

• Full-time: Weekly hours equal 100% (for example, 30/30, 40/40)
• Part-time: Weekly hours less than 100% (for example, 35/40, 30/35)
• Fixed-term contract: A value exists for the Contract ends attribute. If there’s no value, the employee defaults to either full-time or part-time based on weekly hours.

We recommend checking that the information above matches your existing configuration. Make sure the Contract ends attribute is filled in correctly for employees with fixed-term contracts. 

List of attributes for the Xero integration

Authorize the integration with Xero

You need to authorize each legal entity to one Xero tenant. You can authorize multiple legal entities in Personio to different Xero tenants.

To authorize the integration, follow these steps:

1. In Personio go to Payroll > Xero Payroll.
2. Open the Manage tab.
3. In the general settings, choose the legal entity you want to authorize. 
4. Click Connect Xero. The system forwards you to Xero. If you aren't logged in, you must log in and select the correct organization to connect. 
5. Grant permission to the integration. The authorization goes through, and the system returns you to Personio.

The Personio Xero authorization page now shows all details regarding the completed authorization.

Configure Xero integration settings

After the authorization, you must configure pay groups, pay frequencies, and compensations in Payroll > Xero Payroll > Manage for the relevant legal entity.

• Pay groups: Select if you want to create different payroll groups according to salary types (fixed, hourly salary).
• Pay frequencies: Select the pay period calendar relevant to your legal entity. Currently, the integration only supports monthly pay period calendars.

Compensation configuration

The Xero integration syncs fixed salaries, recurring compensations, and one-time compensations. It doesn't sync hourly salaries or bonuses. Learn more about salary components in Personio. 

You can map your existing compensations in Personio to Xero earnings. Your existing Xero earnings appear for a given Personio compensation type based on the Xero earnings category. Currently, you can map “Regular earnings” and “Other earnings” in Personio and sync them to Xero:

• You can map Fixed Salary (Personio) to Xero Earnings with the earnings category “Regular earnings.”
• You can map recurring and one-time compensations to Xero earnings with the earnings category “Other earnings.”

Learn more about how Personio and Xero sync compensations.

Note:
You can only map the Personio fixed salary to a single Xero earning. If multiple Xero earnings for fixed salary exist, we don't recommend the fixed salary sync.

Next steps

To learn how to transfer your monthly payroll data, follow the instructions in our Help Center articles on using the Xero integration and syncing Personio time off to Xero Leave.