Setting up custom expense categories in OFX allows you to organise your business spending, improve reporting accuracy, and ensure compliance with your accounting processes. If your account is connected to Xero, your expense categories (including account codes, tracking categories, and tax options) will sync automatically from Xero. If your account is not connected to Xero, you can create and manage your own custom expense categories directly in OFX.

Prerequisites:
Before you set up custom expense categories, ensure the following:

• You have permission to access the Expenses section.

• If your account is connected to Xero, your expense categories will sync automatically from Xero.

• If your account is not connected to Xero, you can set up custom categories directly in OFX.

Next Steps:

To set up custom expense categories (for non-Xero users), follow these steps:

1. Log into your OFX account.

2. Navigate to the Expenses tab in the left sidebar menu.

3. Click on the Tax rates & categories button.

4. A window will appear on the right-hand side to set up your mandatory expense categories.

5. Select the Expense categories tab.

6. Click on New expense category.

7. Enter the expense category Name (e.g., Office Supplies), the Code, and the Default tax rate.

8. Click Save changes.

9. Repeat steps 6, 7 and 8 for each expense category needed.

10. Click Confirm to save.

To create optional custom categories (such as tax codes or tracking categories):

1. In the same window, scroll to the section below Mandatory expense categories.

2. Click Custom categories tab.

3. Click on the Edit button at the bottom.

4. Scroll to the bottom. Click on + Create another one.

5. Enter the Category group name (e.g., Tax type).

6. Enter the category name (e.g., GST on Expenses).

7. Click Save changes.

8. Repeat steps 2 to 7 for each additional category.

What happens next:
Your custom expense categories will be available for selection when creating expenses, assigning categories to cards, or setting up budgets. You can return at any time to update or add new categories as your business needs change.

Why is this important:

Setting up custom expense categories ensures your business expenses are accurately tracked and reported. This supports better financial oversight, simplifies tax preparation, and helps you comply with internal policies and external accounting requirements. Custom categories also allow you to tailor expense tracking to your unique business structure, projects, or departments.

Related FAQ Articles:

• How do I categorize Expenses?

• How to set up custom Tax rates and categories?

• How do I create a new employee card? [Merged]

• How can a user add expense categories to the card?

• How do i create a budget with expense categories ?