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Xero bookkeeping for consultants

When a few large clients bring in much of your income, their payment terms decide when you have cash. We keep your retainer and time-based invoices, rebilled expenses and running costs current in Xero, so you can see what each client is worth to the business.

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  • By Book Keeping Pros
  • Sources checked 15 Oct 2026

Keeping a consultancy's Xero file current

Consulting income tends to come from a few sizeable invoices on each client's own terms, and many costs are run up for a particular client and passed on. We keep both visible, client by client.

  • Retainer invoices tracked through each billing cycle, with each client payment matched to the retainer it covers
  • Time-based invoices recorded against the right client and project, ready to match when the client pays
  • Client expenses you pay first and bill on, such as travel, venue hire or data purchases, tagged to the client and listed until they appear on an invoice
  • Aged receivables each month showing your larger clients' invoices by due date, so you can see when cash should arrive and which payments are late
  • Software subscriptions, from video calls to project tools, coded as they come through on your card, with the receipt attached
  • Travel that is not billed to a client, such as business development trips, kept apart from rebillable travel
  • Client profitability from tracking categories: income and the costs tagged to each client brought together in a profit and loss filtered by that client

Not included

Decisions on pricing or which clients to keep. The reports show what each client brings in and costs, and those calls stay with you.

Businesses in Management Advice and Related Consulting Services (ANZSIC class 6962)

Actively trading businesses across Australia
103,124 businessesAustralian Bureau of Statistics, Counts of Australian Businesses, June 2025, checked 15 October 2026
Of those, classified as non-employing
64,738 businessesAustralian Bureau of Statistics, Counts of Australian Businesses, June 2025, checked 15 October 2026
Of those, with 1 to 4 employees
32,039 businessesAustralian Bureau of Statistics, Counts of Australian Businesses, June 2025, checked 15 October 2026

Businesses by main state or territory

These counts are for the ANZSIC class Management Advice and Related Consulting Services. Consultants in other fields, such as engineering or computer systems, are counted in other ANZSIC classes.

  1. New South Wales38,324 businesses
  2. Victoria26,886 businesses
  3. Queensland19,267 businesses
  4. Western Australia9,433 businesses
  5. South Australia4,979 businesses
  6. Australian Capital Territory2,375 businesses
  7. Tasmania1,270 businesses
  8. Northern Territory525 businesses
Source: Australian Bureau of Statistics, June 2025. Counts of Australian Businesses, data cube 2: Businesses by main state by industry class by employment size ranges (8165DC02.xlsx). Checked 15 Oct 2026.

Businesses by number of employees

  1. Non-employing64,738 businesses
  2. 1 to 4 employees32,039 businesses
  3. 5 to 19 employees4,672 businesses
  4. 20 to 199 employees1,608 businesses
  5. 200 or more employees67 businesses
Source: Australian Bureau of Statistics, June 2025. Counts of Australian Businesses, data cube 2: Businesses by main state by industry class by employment size ranges (8165DC02.xlsx). Checked 15 Oct 2026.

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Consultants' questions about Xero

Can Xero show which clients are actually profitable?
Yes, if income and costs are tagged to the client. We tag invoices, rebilled expenses and direct costs to the client using a tracking category, so a profit and loss filtered by that client shows what it brings in after the costs tagged to it.
What happens to travel I pay for and bill on to clients?
Each rebillable cost is tagged to its client when it comes through the bank or card feed. We list the costs that have not appeared on an invoice yet, so you can add them before you bill.
A big client pays on long terms. Can you help me see my cash flow?
Each invoice keeps its due date in Xero, so the aged receivables report shows what is due from each client and when. Read with your bank balance and the bills due in aged payables, it shows the gaps between paying your costs and being paid.
I work on retainers and hourly rates. Does that change how the books are kept?
Not much. Retainer and hourly invoices are both entered under the client and matched to payments as they arrive. Where a retainer is paid ahead of the work, it is recorded using the treatment your accountant specifies.
My subscriptions are spread across several cards. Can you sort them out?
Yes. We reconcile each card account against its statement, attach the receipts to the transactions and give each subscription an expense account of its own, so your monthly software spend is easy to see in the profit and loss.

Sources

  1. Counts of Australian Businesses, data cube 2: Businesses by main state by industry class by employment size ranges (8165DC02.xlsx)

    Australian Bureau of Statistics. Actively trading businesses at 30 June 2025, released 16 December 2025. Checked 15 October 2026.

    Source: Australian Bureau of Statistics, Counts of Australian Businesses, including Entries and Exits, June 2021 to June 2025, licensed under CC BY 4.0 Licence: CC BY 4.0.

  2. Correspondence, GCCSA 2021 to GCCSA 2026 (CG_GCCSA_2021_GCCSA_2026.csv)

    Australian Bureau of Statistics. ASGS Edition 4, July 2026 to June 2031, released 22 July 2026. Checked 15 October 2026.

    Source: Australian Bureau of Statistics, Australian Statistical Geography Standard (ASGS) Edition 4, licensed under CC BY 4.0 Licence: CC BY 4.0.