Xero vs Hnry 2026: Which Is Better for a Small Business?
Xero vs Hnry in 2026: an accountant compares pricing, tax, bank feeds, payroll and ecommerce to show which suits sole traders and which suits small businesses.
Xero and Hnry often show up on the same shortlist, but they are not really the same kind of product. Xero is accounting software you run yourself (or with your accountant). Hnry is a done-for-you tax and accounting service for sole traders, with the software, a business account and accountants bundled in. Choosing well comes down to your business structure, how much you earn and how much admin you’re willing to do.
Quick answer
- Pick Hnry if you’re a sole trader, freelancer or contractor with no staff. You want tax calculated and paid automatically, and your returns filed for you.
- Pick Xero if you run a company, an online store or a team. You need inventory, payroll, ecommerce integrations or full control over your books.
- Overall: most small businesses, and almost every ecommerce store, are better off with Xero. Hnry wins only in one niche, but wins it clearly: solo service providers who want to never think about tax.
Xero vs Hnry at a Glance
| Hnry | Xero | |
|---|---|---|
| What it is | Tax and accounting service with an app | Cloud accounting software |
| Built for | Sole traders, freelancers, contractors | Any small to mid-sized business |
| Pricing model | 1% + GST of income, capped at $1,500 + GST a year | Monthly subscription by plan |
| Entry cost (AU) | $0 when you earn nothing | A$37/month (Ignite) |
| Tax filed for you | Yes, by Hnry’s accountants | No (you or your accountant) |
| Automatic tax payments | Yes, on every payment received | No |
| Bank account | Income must go through your Hnry Account | Bank feeds from your own banks |
| Payroll / employees | Not designed for employers | Included in AU plans (capped by tier) |
| Shopify / ecommerce | No native store integrations | Official Xero and Shopify app, 1,000+ apps |
| Companies / Pty Ltd | Built around sole traders | Yes |
| Countries | New Zealand, Australia, UK | Global |
What Is Hnry?
Hnry started in New Zealand and now runs in Australia and the UK. When a client pays you, the money lands in your Hnry Account. Hnry works out the income tax, GST, Medicare and student loan you owe, pays it straight to the ATO, and sends the rest to your personal bank account. In practice you get a “payslip” for your self-employed income, much like a salaried employee.
The fee covers invoicing, expense tracking, tax lodgement and access to Hnry’s team of sole-trader accountants. You can also pay business costs with the Hnry debit card, and Hnry raises and reviews those expenses for you.
What Is Xero?
Xero is the cloud accounting platform used by millions of small businesses, especially in Australia, New Zealand and the UK. It connects to your existing bank accounts through bank feeds and handles invoicing, bills, reconciliation, GST/BAS reporting, payroll and reporting. It also connects to a large app ecosystem: over 1,000 third-party apps and 300+ bank and financial connections. For a deeper look, see our Xero review.
The trade-off: Xero is a tool you operate, not a service. It won’t calculate and pay your income tax as money comes in, and it won’t file your return. You still need to do that yourself or pay an accountant.
Xero vs Hnry Pricing
Hnry pricing
Hnry charges 1% + GST of every payment into your Hnry Account, capped at $1,500 + GST a year. It has no subscription. The same structure applies in Australia and New Zealand (in local dollars), and Hnry says it has never raised its prices. In Australia the yearly maximum works out to A$1,650 including GST, which Hnry claims as a business expense for you.
Xero pricing (Australia, from 1 July 2026, GST incl.)
| Plan | Monthly | Yearly |
|---|---|---|
| Ignite | A$37 | A$444 |
| Grow | A$78 | A$936 |
| Comprehensive | A$107 | A$1,284 |
| Ultimate (10) | A$143 | A$1,716 |
Drawn from the table above. Lowest price highlighted.
New Zealand (from 1 October 2026, excl. GST): Ignite NZ$37, Grow NZ$89, Comprehensive NZ$117, Ultimate NZ$135. Xero regularly runs big new-customer discounts for the first three months. See the current deals for Australia and New Zealand.
Which is cheaper at your income?
| Yearly self-employed income (AUD) | Hnry fee / year | Xero Ignite / year | Xero Grow / year |
|---|---|---|---|
| A$20,000 | A$220 | A$444 | A$936 |
| A$40,000 | A$440 | A$444 | A$936 |
| A$60,000 | A$660 | A$444 | A$936 |
| A$100,000 | A$1,100 | A$444 | A$936 |
| A$150,000 or more | A$1,650 (cap) | A$444 | A$936 |
On fees alone, Hnry is cheaper than Xero Ignite for anyone earning under roughly A$40,000 a year, and it never costs more than A$1,650. But it isn’t a like-for-like comparison: Xero’s price doesn’t include an accountant or tax lodgement. Once you add an accountant to Xero, Hnry is often cheaper for solo operators at almost every income level.
Feature-by-Feature Comparison
1. Tax: Hnry wins
This is Hnry’s main advantage. Tax is set aside and paid to the ATO (or IRD/HMRC) as you earn, so you don’t get a surprise bill at tax time, and Hnry’s accountants file your returns. Xero tracks GST and prepares BAS reports, but income tax planning and lodgement are left to you or your accountant.
2. Bookkeeping and bank feeds: Xero wins
Xero pulls transactions from whichever banks you use and lets you reconcile them, with full double-entry books (here’s our bank reconciliation guide if you’re new to it). Hnry needs you to route your income and expenses through a Hnry account, which hands over a lot of control. Xero also lets you get paid into any bank account.
3. Invoicing: roughly a tie
Both offer unlimited invoicing. Hnry has added scheduled and recurring invoices. Xero adds custom templates, recurring invoices, online card payments and quotes. Neither one wins clearly here.
4. Expenses: tie, with different styles
Hnry: pay with the Hnry debit card or snap a receipt, and Hnry’s team reviews and claims the expense. Xero: capture receipts (with Hubdoc or the app) and code them yourself, with more control and more work.
5. Payroll and staff: Xero wins
Payroll and automated super come with every Australian Xero business plan, with the number of employees capped by tier. Hnry is built around sole traders working on their own, so once you hire, you’ve outgrown it.
6. Ecommerce and integrations: Xero wins clearly
For store owners this is the deciding factor. Xero has an official Xero and Shopify integration that automatically sends Shopify sales to Xero for reconciliation against bank data. It also connects to Stripe, PayPal, Amazon connectors, inventory tools and over 1,000 other apps. Hnry has no comparable app marketplace. Most of its value assumes client payments land directly in your Hnry Account, which doesn’t fit stores with many marketplace and payment-gateway payouts. Our Xero for ecommerce guide walks through the setup.
7. Reporting and growth: Xero wins
Xero offers P&L, balance sheet, cash flow forecasting, project tracking, multi-currency (higher plans) and analytics. It scales from a solo business to a 50+ person company. Hnry’s reporting covers what a sole trader needs and stops there.
Pros and Cons
Hnry
- Pro: tax calculated and paid automatically
- Pro: returns filed by real accountants
- Pro: pay only when you earn, with a capped fee
- Pro: very little admin
- Con: sole traders only
- Con: income must flow through your Hnry Account
- Con: no payroll, inventory or store integrations
- Con: withholding can tighten short-term cash flow
Xero
- Pro: full accounting for any business structure
- Pro: bank feeds from your own banks
- Pro: payroll included (AU)
- Pro: Shopify and 1,000+ app integrations
- Con: doesn’t file your taxes
- Con: monthly fee even in quiet months
- Con: prices rise most years
- Con: learning curve, and you do the bookkeeping
Who Should Choose Which?
| Your situation | Better choice |
|---|---|
| Freelance designer, writer, developer or consultant (sole trader) | Hnry |
| Contractor or tradie working alone, hates admin | Hnry |
| Side hustle with irregular income | Hnry |
| Shopify, WooCommerce or Amazon store | Xero |
| Business with employees | Xero |
| Company (Pty Ltd / Ltd) or partnership | Xero |
| Holding stock / inventory | Xero |
| Already have an accountant you like | Xero |
My Verdict
For most small businesses, Xero is the better choice. That’s especially true for anyone selling online, hiring staff or running a company. Hnry is the better choice for solo freelancers and contractors who just want tax handled and would rather pay a capped percentage than learn accounting software.
Still comparing? See our Xero alternatives, Xero vs MYOB and best accounting software for ecommerce.
Frequently Asked Questions
Can I use Hnry and Xero together?
There’s little point. Hnry already includes its own books and tax lodgement, so most people pick one. Sole traders who outgrow Hnry (hiring, incorporating, or launching a store) usually move to Xero plus an accountant.
Is Hnry cheaper than Xero?
Below about A$40k of yearly income, yes, even on software fees alone. Above that, Hnry costs more than Xero Ignite, but it includes an accountant and tax filing, which Xero doesn’t.
Does Hnry work for companies?
Hnry is designed around sole traders. If you’ve set up a company, Xero (with an accountant) is the standard choice.
Which is better for an online store?
Xero. Its Shopify integration, payment-gateway connections and inventory apps are built for ecommerce. Hnry isn’t.
Prices and sources
Prices are as listed on Xero’s and Hnry’s pricing pages as of November 2026 and can change, so check the official pages before you sign up. This article is general information, not tax or financial advice. Sources: Hnry pricing, Xero AU price changes, Xero NZ price changes, Xero and Shopify integration, Rounded, Digit, ANNA.
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