How Long Does Xero Keep Data After Cancellation? What They Don't Guarantee About Your Data.


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Closing or selling a business, migrating to a new financial accounting system, or even simply stopping your Xero subscription brings a common question to mind: 'What happens to my financial data?' While Xero aims to provide ways to reactivate your account for data access, it's vital to understand the nuances of long-term data retention and, more importantly, your own responsibility for maintaining copies of your crucial records, especially file attachment such as invoices and receipts.

1. Xero's Approach to Data After Cancellation

Reactivation for Access: Xero retains your data for seven years. This grants you the option to leave your Xero subscription dormant and reactivate it to gain access. This is a helpful feature for businesses that might need occasional access to historical information.

The Practicalities of Long-Term Access: While reactivation is an option, what about years down the line? Who still has the original email account and password, or can easily prove their identity to reactivate an account five years later? For those closing, selling or liquidating a business, reactivating an old account could become a significant hurdle.

2. Terms, Conditions and Disclaimers

The Explicit Data Loss Disclaimer: Xero's terms clearly state that 'data loss is an unavoidable risk when using any technology' and that 'you’re responsible for maintaining copies of your data entered into our services’. Their liability for data loss or corruption is limited to taking reasonable steps to try to recover from their backups.

Xero are a professional organisation and go to great lengths to protect your data and files, but they are not liable, and they make it clear that you are responsible for making copies of the data and files.

There are broad liability exclusions including loss of revenue, goodwill, customers, capital and anticipated savings, as well as potential legal, tax or accounting compliance issues, and more. For data loss/corruption, their liability is strictly limited to recovery attempts from existing backups.

This isn't a criticism of Xero, but a standard SaaS practice that users must be aware of to manage their own risk. Whilst Xero will retain the data for seven years that doesn't guarantee against loss (including accidental), corruption or cyber incidents.

3. Why User Responsibility for Backups is Paramount

No Backup Guarantee from the Platform: With it kindly laid out so clearly it is obvious what responsibilities the customer has and what measures they are directed to take: "users are responsible for backing up their own data."

If financial records and associated files are deleted, whether by accident, due to a system failure, or from a cyberattack, they're generally considered gone forever unless the user has taken their own backup. It is also good practice to keep a series of copies at intervals to be able to go back in time prior to the loss or corruption.

Xero offers reports for key information, but it doesn't provide an easy way, or a specific tool,to export all attached files in one go.

4. What Situations Demand Your Own Backup.

It might not be solely to have your own copy as indicated by Xero themselves!

Business Closure: For those shutting down, a complete, accessible archive is vital for long-term compliance without the need to reactivate an old Xero subscription especially in jurisdictions where the legal requirement is longer than seven years.

Data Migration: If a business is migrating to a new accounting system or merging with another firm, exporting data and files is a key part of the migration.

Insurance: Even for ongoing businesses, having an independent copy offers "digital insurance" against any unforeseen platform issues or accidental data loss within their own systems. Some insurance policies and compliance frameworks insist on it.

5. Numerint: Ensuring Your Xero File Attachments are Always Yours

The Missing Piece for Xero Users: backing up file attachments. Data reports are readily available, but backing up potentially tens of thousands of files is where Numerint steps in to fill that gap. Making it as simple as logging in with your existing Xero credentials and clicking Backup across as many Xero subscriptions as you want. Incidentally this is one of the reasons why accountants use Numerint to back up data on behalf of their clients.

All your file attachments are downloaded, in bulk, in a single ZIP archive. The archive includes an extremely useful CSV file that contains all the transactional information

related to the files. This provides an independent, accessible copy of your accounting files.

Typically, Numerint customers perform a complete backup going back to the very start and then routinely perform small incremental backups to capture all new files.

Customers can also select specific date ranges or accounting types for export, making it adaptable for various scenarios like pre-migration archives or to satisfy specific audit requests.

Peace of Mind, Future-Proofed: the Numerint app provides long-term accessibility to your vital records, regardless of Xero's retention policies or fate. Because backups are ZIP archives of your files there is no future dependency on Xero or Numerint ensuring access to your data is safe and futureproofed.

Conclusion: Secure Your Data, Secure Your Future

While Xero provides a robust platform, understanding the limits of their data retention guarantees and your own responsibility is paramount. Don't risk losing access to crucial financial file attachments when your business needs them most.

Numerint offers the straightforward, secure, and cost-effective solution to ensure your Xero attachments are truly yours, always accessible and compliant. Take control of your financial history today.

Visit numerint.com to get a quick, personalised, on-demand? quote and safeguard your business's vital records, and your peace of mind.

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