Step 1: Log into Xero and Access Bank Accounts
- Go to Accounting in the main menu, then select Bank Accounts.
Step 2: Create a New Bank Rule
- Choose the bank account you want to set rules for.
- Click Bank Rules and select Create Rule for Spend or Receive Money.
Step 3: Set Conditions for the Bank Rule
- Define rule criteria, such as contains or equals, and enter keywords (e.g., vendor names).
- Add multiple conditions to refine the rule if needed.
Step 4: Define the Transaction Details
- Set the payee or contact associated with the rule.
- Choose an account (expense or income category) for coding transactions automatically.
Step 5: Specify Tax Rate and Tracking
- Select the applicable tax rate.
- Add any tracking categories if you’re using them in Xero.
Step 6: Save and Apply the Rule
- Click Save to activate the rule. It will now automatically match future transactions meeting the criteria.
Step 7: Test and Adjust the Rule
- Go to Reconcile to see the rule in action.
- If the rule isn’t working as expected, revisit Bank Rules to refine the conditions.
Using bank rules in Xero saves time and simplifies transaction reconciliation by automating repetitive categorization.