Xero is where the accountant sees your costs. EZTime is where labor cost starts. Connecting them is about categories, not hours.
An accounting system wants totals and categories, not clock punches. What the accountant uses is wages by period, split the way you want to see profit: by location, by department or by project. Hours in EZTime become cost only once they are multiplied by pay rates and loaded with taxes and benefits, and those figures often come from payroll rather than from time tracking.
To record clock-ins, breaks and overtime automatically, see EZTime time and attendance software.
The data points, direction and timing for your account are confirmed with the EZTime team during setup, so use this page to prepare your questions rather than as a technical specification.
Xero lets you tag transactions with tracking categories, commonly used for locations, departments or projects. If you want profit by location, set the categories up before the first month, and keep names the same in EZTime. A location called Main St in one system and Downtown in the other costs your accountant an hour each month.
A landscaping company has made-up wages for one month:
| Department | Hours | Wages | Share of revenue |
|---|---|---|---|
| Maintenance | 1,240 | $24,800 | 31% |
| Installations | 760 | $17,480 | 38% |
| Office | 320 | $7,200 | 11% |
Seen this way, installations carry a heavier labor share than maintenance. Without categories, the whole $49,480 sits in one wages line and the question is not even visible.
If payroll is run in another system, the wages usually reach Xero as a journal at the end of each pay run. Time tracking is upstream of both. Keep the order clear: approved hours, then payroll, then the books. Reconcile each month by comparing total hours times average rate to the wages posted.
Most small businesses using Xero with a separate payroll provider post one journal per pay run. The journal moves gross wages and employer costs into expense accounts and the amounts owed into liability accounts. Here is a simplified, fictional journal for a two-week run at the landscaping company above, split with a tracking category for department:
| Account | Tracking category | Debit | Credit |
|---|---|---|---|
| Wages expense | Maintenance | $11,400 | |
| Wages expense | Installations | $8,040 | |
| Wages expense | Office | $3,310 | |
| Employer payroll taxes expense | Split by the same shares | $1,740 | |
| Wages payable (net pay) | $18,220 | ||
| Payroll tax and withholding liabilities | $6,270 | ||
| Totals | $24,490 | $24,490 |
The department split comes from approved hours in EZTime multiplied by each employee’s rate. Your accountant may prefer a different chart of accounts, so treat the layout as an illustration, not a template to copy.
Pay periods rarely end on the last day of the month. If the last pay run of March covers work up to March 24, the hours worked from March 25 to 31 are an expense of March, even though they are paid in April. Accountants usually record those as accrued wages.
Approved time is what makes that accrual accurate. Run a report of hours from the day after the last pay period through month end, multiply by rates, and give the figure to whoever closes the books. A fictional example: 1,060 unpaid hours at an average of $21.50 gives an accrual of $22,790, posted on March 31 and reversed on April 1.
| Mistake | Effect |
|---|---|
| All wages in one account with no tracking | Profit by location or department cannot be seen |
| Tracking categories renamed mid-year | Year-to-date comparisons break |
| Shared staff charged entirely to one location | One location looks unprofitable and another looks cheap |
| No accrual at month end | Labor cost swings from month to month with the pay calendar, not with the work |
Each of these is fixed by deciding the rule once and recording hours with the right tag at the time they are worked. EZTime lets you tag time with jobs, clients and roles, so the split exists before anyone builds a journal.
Contractors who log time for billing do not go through payroll. Their hours support a bill in Xero, not a wage journal, and their cost should land in a contractor or subcontractor expense account. Keep them in a separate group in EZTime so their hours never mix with employee wages, and so the year-end forms your accountant prepares for contractors match what was paid.
It can, through the EZTime API (Premium plan) or a custom integration built by EZTime’s development team. The EZTime team can tell you how it works for your organization.
Not by itself. It needs cost by category. Hours help you check that the cost makes sense.
Yes. Record the hours under each job or location and let the cost follow.
If you report on an accrual basis, usually yes, because work done before month end but paid later is an expense of that month. Ask your accountant.
The split comes from how hours are tagged. If every shift has a location, the share of wages per location can be calculated for the journal.
Many businesses do that because it is simple and close enough. Your accountant may prefer a different method.
Wages as a share of revenue
Convert pay between formats
Weekly overtime math
Book a demo and bring one pay period or one week of sales. We will go through what you want to see and which data is needed.
Xero is a trademark of its owner. EZTime is not affiliated with or endorsed by Xero. This page is general information, not legal, payroll or tax advice. Rules differ by state, city and contract, and they change. Check with a qualified professional before you act. Numbers in examples are made up.