Setting up Xero before Processing Payroll

This article covers what you need to set up before integrating Xero Payroll with ClubsHR.

Please note: Xero payroll is only supported in Australia, New Zealand and the United Kingdom. Also, the account signed into on Xero requires payroll permissions.

Also note: This is an essential step in your account setup, and you should set an hour aside to complete this in one sitting to ensure everything is completed.

Ensuring your Xero Setup is correct will save you time and ensure that Xero payroll processing goes smoothly. 

ClubsHR's Xero integration works to push data across without interrupting any of your existing settings.

  

For Help Setting Up Your Accounts

Please do not hesitate to contact us by:

• Email: help@clubshr.com
• Book a free 30-minute video call with our ClubsHR Customer Success Team
• Live Chat: The blue 'question mark support button' to the bottom right of your browser

Pay Calendars

Xero uses a  Pay Calendar feature to determine an organisation's pay cycle. ClubsHR also has a similar feature which is called Payroll Calendar. These settings need to be aligned so Xero can receive timesheets from ClubsHR.

Depending on your situation, the setup will vary. We'll cover the three scenarios we come across for Pay Calendars:

1. If you are an existing* ClubsHR customer and want to create Pay Calendars in a new Xero account to match your existing ClubsHR Pay Cycle settings, click here.

2. If you are an existing Xero customer and want to set up your Pay Cycles in a new* ClubsHR account to match your existing Xero Pay Calendar, click here.

3. If your Xero and ClubsHR accounts are established, click here.

*For this help article, a new ClubsHR account means you haven't processed any payroll in your account yet.

 

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Creating Pay Calendars in Xero (Scenario 1)

The following instructions are done in Xero and are used when you are an existing ClubsHR customer and want to set up Xero to match your existing ClubsHR pay cycle settings.

Before you start, if you don't know your pay cycle settings in ClubsHR, click here and note down the information in the Payroll Calendar.

 

1. Head to Payroll Calendar Settings in Xero by clicking here.

2. Click the Add Pay Calendar button, and a popup box will appear.

3. For the Pay Period field, select the Weekly or Fortnightly option depending on your pay cycle.

4. For the Start Date field, select the date that matches your roster cycle in ClubsHR. E.g. If your roster cycle in ClubsHR is Monday to Sunday, select a Monday date.

5. For the First Payment Date field, select a date that matches the first time you wish to pay your employees

NOTE: UK and NZ customers must enter the name 'clubshr'

6. Now that you've completed this section, skip to Pay Items.

 

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Creating Pay Cycles in ClubsHR (Scenario 2)

The following instructions are done in ClubsHR and are used when you are an existing Xero customer and want to set up ClubsHR to match your existing Xero pay calendar settings.

Before you start, if you don't know your pay calendar settings in Xero, click here and note down the information in the Pay Period and Next Pay Period for your default Pay Calendar. You will need to know whether the pay frequency is weekly or fortnightly, and based on the next pay period, work out the start and end days of the period.

For instance, if the pay period is 29/03/2022 - 04/04/2022, it would be a Tuesday to Monday Weekly pay period.

1. Head to Payroll Settings in ClubsHR by clicking here

2. Update the two fields in Payroll Calendar, as shown in the screenshot below, so they align with your Xero settings.

3. After completing this section, skip to Pay Items.

 

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Both Xero and ClubsHR are Established (Scenario 3)

These instructions check if ClubsHR's Pay Cycle and Xero's Pay Calendar settings match.

1. Head to Payroll Settings in ClubsHR by clicking here

2. Head to Pay Calendars in Xero by clicking here

3. Compare the two to make sure they match:

ClubsHR: Look at the Payroll Calendar settings and note down the two fields shown in the screenshot below.

Xero: Look at the Pay Period and Next Pay Period for your default Pay Calendar. You will need to know whether the pay frequency is weekly or fortnightly, and based on the next pay period, work out the start and end days of the period.

For instance, if the pay period is 29/03/2022 - 04/04/2022, it would be a Tuesday to Monday Weekly pay period.

4. If they match, you can move on to the following process, Pay Items.

5. If they don't match, please get in touch with support on the contact details at the top of this article. 

 

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Pay Items

Before creating a Pay Template, you must ensure that you have Pay Items set up in Xero for ClubsHR to assign Timesheet hours.

This is done from the Payroll Settings in Xero (click for direct link). You can access this area by clicking on your organisation in the top left, then clicking Settings > Payroll Settings > Pay Items. 

Depending on how you have been paying your staff previously, your Pay Items will differ from those shown here.

Here's an example of a simple pay structure:

Monday to Friday / Ordinary Hours: $21.72

Saturday : $32.58

Sunday: $38.01

Public Holiday: $54.30

 

1. To add these types of Pay Items to Xero, click the Add button on the upper left of the Pay Items tab, then select Ordinary Time Earnings

Please note: Monday to Sunday standard hours should ALL be Ordinary Time Earnings.

Here you will need to see the options for Ordinary Time Earnings. 

 

2. Complete the fields in the Pay Item as follows:

Earnings Name: Name that ClubsHR will show in the Pay Template dropdown.

Note: If you have a complex pay structure or many different pay rates, it is essential that you choose naming conventions, as you will need to find these items from the list in ClubsHR.

 

Rate Type: Multipliers are strongly recommended. However, you will need to make sure that your staffs 'Ordinary hours' are set correctly.

Multiple: Calculated from your ordinary hours

NOTE: If you need to use the Rate Per Unit method, Type of Unit should be set to Hours and you must keep ALL unit types the same. If one is 'Hours' and another is 'Hour', Xero will not let ClubsHR process timesheets.

 

Expense Account:  Expense accounts for this Pay Item. By default within Australia, this should be 477: Wages And Salaries; however, if you are unsure, please contact your bookkeeper or accountant regarding this. 

Please note: If you have manually set a staff member's Xero Pay Template (NOT ClubsHR Pay Templates) and adjusted the rate there, this will override the Earnings Rate for that Pay Item. This is not recommended as it stops you from having one central place to update your pay rates and can lead to a confusing setup.

 

Setup staff

The final step in Xero is to ensure all your employees in ClubsHR are also set up in your Xero account.

1. Go to the Payroll tab in the middle of the menu bar.

2. Select Employees from the drop-down menu that appears.

3. You should now see a breakdown of all your current employees. Please ensure all employees in ClubsHR are also listed in your Xero account.

4. For each employee, you must ensure that the first name, last name and email address match ClubsHR. If any do not match, ClubsHR will help you try and match manually at a later stage, but it is best to ensure details match, to begin with. 

5. Next, click on the second tab from the left titled Employment.

6. For the Payroll Calendar field, select your payroll calendar.

7. For the Earnings Rate field, select the pay item that is the staff's default earning rate.