A trade business does not buy accounting software. It buys a place to put progress claims, retention, materials that are still on a pallet, wages that belong on a job, and a BAS that has to match the ledger. Xero and MYOB will both take the subscription. They will not both suit the same yard.

This is not a brochure. The original Bookkeeping Centre sat with builders, sparkies, cleaners and shopfitters in Sydney and Perth and watched both products lie when the setup was lazy. The question is not “which brand is winning”. The question is which file you can close on a Wednesday without inventing profit.

If you already run Xero, read a setup that survives the first BAS. If you already run MYOB, most of that discipline still applies. If you are choosing, stay here.

What a trade file actually has to hold

Before features, list the objects the business already has:

  • quotes that become variations that become claims
  • jobs that last longer than a BAS quarter
  • materials bought in bulk and used across jobs
  • subcontractors who may be TPAR and may be SG-liable — see contractors versus employees
  • employees on awards, casual loading, overtime, and from 1 July 2026 payday super
  • retentions held by the client, and retentions you hold
  • plant that is an asset, not a job expense
  • a GST registration at 10 per cent, often on an accrual basis because claims are issued before cash arrives
  • a bank that receives progress payments net of retention and sometimes net of a head-contractor portal fee

If your “trade” is a one-person maintenance run with no stock and invoices paid on the day, you do not have that list. You have a service file. Xero is usually enough, and cheaper in attention. If you have that list, the product that cannot hold jobs and stock without a forest of add-ons will cost you a second system.

Jobs and progress claims

MYOB’s traditional strength in the trades is the job card that can carry income, materials, labour and overhead without pretending a tracking category is a contract. Progress claims, variations and retentions are first-class ideas in the older MYOB shapes and in the current trade-oriented MYOB products. You can raise a claim that is not the whole job, leave retention on the balance sheet, and still see whether the job is drowning.

Xero’s native “projects” (and the tracking-category habit that preceded them) will give a small renovator a profit-by-job view if every bill and every timesheet is coded. They are weaker when a job has staged claims, retention, a variation register, and materials issued from a store. The Xero ecosystem then sells you a job-costing add-on. That can work. It is also a second subscription, a second login, and a second place for GST to go missing.

Practical test: take last year’s messiest job — the one with three variations and a retention release — and ask each vendor to show you, in a demo file, the claim, the variation, the retention liability, and the job P&L. If the salesperson shows you a dashboard instead, you have your answer.

Do not let either product expense materials on purchase and then call the job report “actuals”. That is the lying P&L problem, and it is product-agnostic.

Inventory and the ute

If you hold stock — pipe, board, fittings, a warehouse of whitegoods — you need inventory, not a materials expense account. MYOB has historically been the less apologetic inventory product for a trade: items, locations, bills that receipt into stock, and issues onto jobs. Xero inventory will cover a simple finished-goods list. It is not a warehouse system, and the marketplace will again offer to become one.

A ute is not a location in software unless you will stocktake it. Most trades should treat the ute as a job-issue point or as a small consignment they count monthly, not as a third warehouse they never open. Either product will let you be silly. Neither will stop you.

If you are mostly install-to-order with supplier drop-ships, you may not need inventory at all. Buy to the job, receipt the bill to that job, and skip the stock module. Buying a product because it “does inventory” when you do not hold inventory is how a file gets 400 items called “misc”.

Bank feeds, rules and the week you actually live in

Xero’s bank feeds and reconciliation screen are, for most Australian files, the better everyday tool. Rules, suggested matches, and the speed of a feed are why bookkeepers reach for Xero on a Tuesday morning. MYOB’s feeds have improved; they are still not the reason people switch to MYOB.

That advantage becomes a vice if you treat the feed as the books. Bank feeds, rules and a false close is written from Xero scars, but MYOB will hide a drawing just as happily if you teach it to.

For a trade, the feed must cope with:

  • progress payments that do not match the claim (retention, portal fees)
  • supplier bills paid by the owner’s personal card
  • transfers to a materials account or a project-specific bank
  • merchant or head-contractor deductions

Ask the demo to match a $47,300 claim paid as $45,000. If the product wants you to write off $2,300 as a discount, it does not understand retention.

Payroll, STP and super

Both products can run Australian payroll with Single Touch Payroll Phase 2, which is mandatory. Both can calculate Super Guarantee at 12 per cent of ordinary time earnings from 1 July 2025 and, if you keep them current, pay it on payday from 1 July 2026. Neither will save you from a wrong OTE tick. That is the OTE essay, not a vendor feature.

Xero payroll is familiar to a large slice of the bookkeeping market. Finding a replacement when your bookkeeper leaves is easier. MYOB payroll is capable and sometimes closer to award interpretation in particular products. “Capable” is not “set and forget”. Assign the award, check casual loading against the award (do not invent a percentage), and preview the STP event in both systems the same way.

If payroll is the only thing you do in accounting software and jobs live in a builder’s package, pick the product your adviser already lives in. Integration with a trade-specific job system may matter more than which general ledger logo is on the invoice.

BAS, advisers and the person who inherits the login

Xero’s adviser ecosystem in Australia is deep. A new tax agent can usually find their way around a Xero file in an afternoon. MYOB files, especially older desktop conversions sitting in a hosted company file, can be slower to hand over and easier to lock inside one operator’s head.

That is not a reason to avoid MYOB if the job ledger needs it. It is a reason to keep books a tax agent can use: conversion balances, GST control reconciled to each BAS, a chart that uses Australian words, and a lock date.

GST is 10 per cent in both. Simpler BAS is a registration choice, not a software choice. Accrual GST is often the honest basis for a trade that issues claims before it is paid. Do not pick cash GST because the feed is easier if your claims are large and unpaid at quarter-end. The ATO basis you registered is the basis you code to.

Lock dates exist in both. Use them. A trade file without a lock is a file whose March job profit will move in July when a late bill is dated back.

Cost, add-ons and the honest total

Compare subscriptions inclusive of payroll, inventory, and the job add-on you will actually need. Xero looks cheaper until you add a job-costing app, a timesheet app, and an inventory app. MYOB looks dearer until you notice those objects were already in the box you bought.

Also cost the people. A bookkeeper who already runs twenty Xero trades will be faster in Xero even if MYOB is “better” on a feature grid. A bookkeeper who grew up on MYOB jobs will code retentions correctly on day one. Software that nobody in your suburb can support is not a strategy.

Implementation is a cost. Budget days, not an evening, for conversion balances, job opening WIP, stock, payroll YTD and a chart that matches how you claim. A cheap subscription with a sloppy conversion is the most expensive option we see.

A decision that fits on one page

Choose Xero when most of this is true:

  • few concurrent jobs, or jobs that are really invoices with a label
  • little or no stock
  • you want the bookkeeper and the tax agent in the same live file
  • bank rec is the daily pain, not variations
  • you will not buy three add-ons to recreate a job card

Choose MYOB when most of this is true:

  • jobs last for months, with variations and retention
  • you hold stock or a serious materials store
  • progress claims are how you get paid
  • you already have someone who can run a MYOB job ledger
  • you would rather one product do the job than a constellation of apps

Choose neither as a personality. Plenty of good trades run one general ledger and a proper builder’s package, and only post summaries. That can be the adult answer when claims, forecasts and site diaries have outgrown both brands.

The Rosebery desk did not have a favourite logo. It had a favourite close: cash that matches statements, jobs that do not invent profit, GST at 10 per cent that reprints onto the BAS, and super that leaves on payday. Pick the product that will let you do that for the work you actually take, not for the work the salesperson showed you on a clean demo job called “Kitchen reno 1”.