Xero Setup for UK Restaurant Delivery: Configuration Guide

Setting up Xero correctly for a UK restaurant on delivery platforms takes more than the default new-organisation setup. The standard Xero configuration works for a business with simple income streams. A restaurant with Deliveroo, Uber Eats, and Just Eat payout revenue needs additional account codes, a delivery-specific chart of accounts, and a weekly journal workflow that handles gross sales, commission, VAT on commission, and refunds correctly.

This guide walks through the setup steps, from chart of accounts to weekly journal template, with the specific codes and configuration decisions that make delivery-platform bookkeeping accurate rather than approximate.

Before you start: what Xero does and does not handle

Xero handles the bookkeeping and VAT return side of delivery accounting well — once the data is in. What Xero does not do:

• Import Deliveroo, Uber Eats, or Just Eat reports automatically
• Calculate the gross/commission/VAT split from a platform payout
• Match a weekly lump deposit to its component transactions automatically

Everything downstream of "upload the right numbers in the right accounts" works well in Xero. Everything upstream — getting the right numbers from the platform reports — requires a manual process or a dedicated reconciliation tool. This setup guide covers the Xero configuration; for the weekly reconciliation process itself, see our step-by-step guide to reconciling delivery payouts in Xero.

Step 1: Set up your chart of accounts

The chart of accounts is the foundation. For delivery-platform revenue, you need dedicated accounts that separate:

Revenue accounts:

• Delivery income — Deliveroo (standard-rated) — e.g. account code 200
• Delivery income — Uber Eats (standard-rated) — e.g. account code 201
• Delivery income — Just Eat (standard-rated) — e.g. account code 202
• (If you sell cold/zero-rated food through platforms) Delivery income — [Platform] zero-rated — codes 205-207

If you sell only hot food through delivery platforms, you only need the standard-rated accounts. If you sell a mix, you need separate accounts per rate per platform. Expense accounts:

• Platform commission — Deliveroo — e.g. account code 470
• Platform commission — Uber Eats — e.g. account code 471
• Platform commission — Just Eat — e.g. account code 472
• Platform refunds — Deliveroo — account code 480
• Platform refunds — Uber Eats — account code 481
• Platform refunds — Just Eat — account code 482
• Platform service fees — account code 485 (can be combined across platforms if low volume)

The exact codes are flexible — what matters is the structure: one revenue account and one expense account per platform, with refunds as a separate expense rather than netting against revenue.

For a fuller set of codes and Xero-specific setup notes, see our delivery-aware chart of accounts guide.

Step 2: Configure VAT on commission accounts

In Xero, the commission accounts (470-472) need to be set up to record the VAT on commission as input tax. There are two approaches:

Option A: Single commission account, journal entry handles the VAT split

Record the gross commission (excluding VAT) in the commission account. In the weekly journal, add a separate line for the VAT on commission, coded to your input VAT account. Xero will include this in your VAT return as reclaimable input tax.

Option B: Two commission accounts per platform (commission ex-VAT and VAT on commission)

Some operators prefer separate accounts for commission and commission VAT. This makes the weekly journal cleaner but creates more accounts to manage.

Either option works. Option A is simpler for single-brand operators; Option B is clearer for multi-platform operations where the VAT amounts are significant and you want them visually separated in your P&L.

Important: code the full commission VAT as reclaimable input tax (T1), even if you sell zero-rated cold food alongside hot. Zero-rated supplies are taxable supplies taxed at 0%, not exempt supplies, so they do not restrict recovery — VAT Notice 700 allows recovery of input tax relating to supplies "liable at the standard rate, reduced rate or the zero rate." What the hot/cold split does govern is your sales coding in Step 1. See our VAT on delivery commissions guide for the worked example.

Step 3: Set up tracking categories

Xero's tracking categories let you tag transactions with additional dimensions — useful if you want to report by delivery channel, brand, or location within a single Xero organisation.

For a single-brand restaurant on three platforms, the chart of accounts structure may be sufficient without tracking categories. For a restaurant with dine-in and delivery channels that you want to report separately, add a tracking category "Channel" with options: Dine-in, Deliveroo, Uber Eats, Just Eat, Takeaway Phone.

For a multi-brand dark kitchen, tracking categories by brand (Brand A, Brand B, Brand C) combined with platform-level account codes lets you report both dimensions without creating an unmanageable account structure. See our dark kitchen accounting guide for the multi-brand variant.

Step 4: Create journal templates

Xero does not have a built-in "journal template" feature, but you can save a manual journal as a recurring journal — useful for the weekly payout entries. Create a template journal with:

Deliveroo weekly payout journal:

• Dr 200 (Delivery income — Deliveroo) — gross food sales [amount varies]
• Cr 470 (Platform commission — Deliveroo) — commission ex-VAT [varies]
• Cr Input VAT — VAT on commission [varies]
• Cr 480 (Platform refunds — Deliveroo) — refunds [varies]
• Cr Bank — Net deposit [varies, should reconcile to the bank]

The amounts vary each week; the structure does not. Having the template pre-built means you are not rebuilding the journal from scratch every week — you update the amounts from the platform report.

Set up equivalent templates for Uber Eats and Just Eat.

Step 5: Set up bank rules for delivery deposits

Xero's bank rules can automatically categorise bank transactions that match certain criteria. For delivery platform deposits:

• Create a rule for transactions from "DELIVEROO" (the bank reference text) → suggest as "awaiting manual journal reconciliation"
• Similarly for Uber Eats and Just Eat deposit references

The rule does not replace the journal — but it stops the deposit being auto-coded to a catch-all account before you have had the chance to run the weekly reconciliation. The bank reconciliation step matches your weekly journal's net line to the deposit.

Step 6: Set up bank feeds

Connect your business bank account via Xero's bank feed. Most UK business banks (HSBC, NatWest, Barclays, Lloyds, Starling, Monzo Business) support direct bank feeds in Xero. Once connected, transactions appear automatically for reconciliation.

For delivery platform deposits, the bank feed shows the lump-sum deposit. Your weekly journal provides the component breakdown. Bank reconciliation matches the journal net to the deposit.

The weekly workflow once configured

With the setup complete, your weekly delivery bookkeeping workflow is:

1. Monday or Tuesday: Download reports from all three platforms for the prior week
2. Calculate gross sales, commission, VAT on commission, refunds per platform from each report
3. Enter journal entries using your templates — update amounts from the calculated figures
4. Bank reconciliation — match each journal's net line to the corresponding bank deposit
5. VAT check — confirm the commission VAT is coded in full as reclaimable input tax, and that the sales lines are split by rate

Total time: 2-3 hours per week for a three-platform restaurant at moderate volume. For a multi-platform, multi-brand operation, see our multi-platform delivery reconciliation guide.

Key takeaways

• Chart of accounts structure — separate revenue and expense accounts per platform, with refunds as their own expense line, is the foundation that makes all downstream reporting work.
• VAT on commission must be captured as a separate line in each weekly journal — not buried in the commission expense figure — to appear correctly in your VAT return.
• Commission VAT is reclaimable in full — selling zero-rated cold food does not restrict it. Partial exemption needs exempt supplies, which restaurants do not make. Apportion your sales by rate instead.
• Bank rules help prevent deposits being auto-coded before you run reconciliation; the weekly journal matches to the deposit after you process the platform report.
• Xero handles everything downstream of correct data entry — the payout splitting step upstream remains manual without a dedicated tool.

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This guide covers Xero setup for UK restaurants on delivery platforms and is for general guidance only. Xero account codes and configuration options may change. It is not accounting or tax advice. For your specific Xero organisation setup, particularly VAT configuration, consult a qualified accountant.