Moving from Hnry to Xero - and what actually happened next.

Hnry is a brilliant on-ramp. Sign up, get paid through them, and they handle your tax, your GST, your ACC, all of it. For someone who's just gone out on their own and doesn't want to think about any of it, that's a real gift.

But it has a cost. Two costs, actually. There's the obvious one - Hnry takes a percentage of every invoice. And there's the quieter one - the claims you can't make because the system isn't set up to find them, and the visibility into your own business that you don't have because you're not really looking.

The point you realise it's time

Most clients come to me about a year or two into being on Hnry. The trigger is usually one of three things. Either they're earning enough that the Hnry percentage is now a meaningful amount of money. Or they've started buying business equipment and realised they can't claim it properly. Or they've been asked for proper financial reports - by a landlord, a bank, an insurance company - and Hnry doesn't produce them.

The realisation is usually quiet. You're looking at a tax return and thinking, that doesn't feel right. You're missing claims. You're missing the picture.

What the move actually looks like

Migrating from Hnry to Xero is more of a setup than a migration. Hnry doesn't export a transaction history in a useful format - they're not built for that. So the move is really about setting up Xero properly from a starting point, and bringing across the bits of history you need (mostly the current tax year so your return reconciles).

The actual steps:

• Cancel your Hnry account on your next billing cycle. You can run both for a month if you want overlap.
• Sign up to Xero. Pick the plan that fits your transaction volume - most sole traders start on Starter.
• Connect your bank feeds. This is the engine. Xero pulls in every transaction; you (or I) code them properly.
• Set up your GST registration with the IRD if you're over the $60,000 threshold (Hnry handled this for you - now you're doing it directly).
• Configure your chart of accounts. This is the bit that actually matters and the bit most people skip.
• Bring across the current year's income from Hnry. You need this so your IR3 reconciles.

The settling-in period

Once Xero is set up, the next month or two is where you learn how to use it. This is the bit that pays back the most. With Hnry you didn't need to know what a claimable expense was, because their algorithm handled it. With Xero, every transaction is a decision - which means you need to know which decisions to make.

When I work with clients in this phase, I sit alongside them on every expense. We go through each transaction, and I show them what to claim, what to flag, and what to leave alone. Within a couple of months, most clients can do it themselves confidently.

The thing most people don't expect is the claims they find. Tools, training, mileage if you're using a personal vehicle for business, the business portion of phone and internet, working-from-home expenses, professional development. Hnry doesn't find these because they can't - you have to know what counts, and you have to flag it.

It happens more than you'd think. A recent nationwide survey found nearly half of New Zealand sole traders aren't claiming all the expenses they're entitled to. Most of them have no idea, because nothing in their setup is looking for it. That's the money I want to help you stop leaving on the table.

The numbers

The Hnry fee model is 1% of invoices up to a yearly maximum. For someone billing $80,000 a year, that's $800. Xero starts around $40 a month on the Starter plan - $480 a year. So even before any tax savings, you're probably ahead.

The bigger number is usually the missed claims. I have clients who came across from Hnry and, in their first year on Xero, found enough additional claims that the savings covered my fees for the quarter and put real money back. That's not everyone - it depends on what you spend money on and how much structure your business has. But it's common enough that I always mention it.

What you give up

The honest part: you give up convenience. Hnry handles your tax in real time. Move to Xero and you (or your bookkeeper) is now responsible for setting aside tax money, paying provisional tax, filing GST returns on time. That's the trade.

If the convenience is genuinely worth more to you than the claims you're missing and the visibility you don't have, staying on Hnry is a fair call. But for most clients who've been running a year or two, the calculus has quietly shifted.

If you're thinking about it

Book a free 30-minute chat. Tell me what you're running, how long you've been on Hnry, and what triggered you thinking about the move. I'll tell you honestly whether you'd be better off staying or moving across - and what the move would look like for your specific situation.

- Karen

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