Before You Start

This guide assumes you have active Lightspeed Retail and Xero subscriptions with administrator access. Familiarity with basic accounting principles is also beneficial.

Overview

45 min
Setup Time
Intermediate
Difficulty
Daily
Maintenance

What You’ll Learn

  • How to prepare your Xero chart of accounts for Lightspeed data
  • Connecting Lightspeed Retail (X-Series) directly to Xero
  • Mapping sales, cost of goods sold, and payment types correctly
  • Automating daily sales entries and reconciling payment payouts

1. Preparation Steps

Before connecting anything, you need these accounts in Xero:

Required Accounts

  • Lightspeed Sales (Revenue)
  • Lightspeed Cost of Goods Sold (Expense)
  • Lightspeed Payout Account (Bank/Asset)
  • Sales Tax Payable (Liability)

Optional (but recommended)

  • Lightspeed Refunds (Expense)
  • Lightspeed Discounts (Revenue)
  • Lightspeed Gift Cards (Liability)

2. Choosing Your Sync Method

You have two main options, each with serious pros and cons.

Method A: Lightspeed’s Native Xero Integration

This is the built-in app provided by Lightspeed.

Pros:
  • Built-in, often included with Lightspeed.
  • Direct connection, fewer third parties.
  • Good for basic daily sales summaries.
Cons:
  • Limited customization for complex setups.
  • COGS tracking can be manual or less precise.
  • Reconciliation can be tricky with partial payouts.

Method B: Advanced Third-Party Connectors

These are paid apps that offer far more control or specific features.

Expert Tip: For most retail businesses, Lightspeed’s native Xero integration is powerful enough. However, for highly complex inventory management, multi-location setups, or specific reporting needs, consider advanced third-party connectors or custom API solutions for deeper control and automation.

3. Step-by-Step: Syncing with Lightspeed’s Native Xero Integration

The Lightspeed to Xero integration typically automates the creation of a daily sales summary, including sales, taxes, discounts, and payment methods, posted as a manual journal or a sales invoice. This flow ensures your daily retail activity is accurately reflected in your accounting system.

Here is a sample code block to show how a Lightspeed sales summary might be structured.

{
  "date": "2025-01-01",
  "location": "Main Street Store",
  "total_sales": 1250.75,
  "tax_collected": 100.50,
  "discounts_given": 25.00,
  "payment_breakdown": {
    "cash": 300.00,
    "credit_card": 900.25,
    "gift_card": 50.00
  },
  "cogs": 600.00
}

4. Setting Up Lightspeed’s Native Xero Integration

  1. 1

    Connect Lightspeed to Xero

    In Lightspeed Retail, navigate to the Integrations section and select Xero. Follow the prompts to authorize the connection to your Xero organization.

  2. 2

    Map Account Categories

    Carefully map your Lightspeed sales categories, cost of goods sold (COGS), and various payment types to their corresponding accounts in your Xero chart of accounts. This is crucial for accurate reporting.

  3. 3

    Configure Tax Settings

    Ensure your tax rates defined in Lightspeed align with your Xero tax rates. Map them correctly to your Xero Sales Tax Payable liability account to avoid discrepancies.

Common Error: Mismatching COGS or Inventory Accounts

Ensure your Lightspeed Cost of Goods Sold account is mapped to an Expense account type in Xero, not an Asset. Similarly, confirm inventory asset accounts are correctly configured to reflect stock on hand.

5. Testing Your Setup

Test Import Checklist

  • Process a small test sale in Lightspeed and check Xero for the entry
  • Verify all sales, discounts, and tax amounts match your Lightspeed reports
  • Confirm payment type entries are correctly recorded against their respective accounts
  • Reconcile a test payout from your bank feed in Xero to ensure it clears the Lightspeed Payout Account

Need Help?

Get Support

Struggling with your Lightspeed to Xero integration? Our team specializes in retail accounting automation and can help fine-tune your setup.

Contact Us