Automate Supplier Invoice Data Entry into Xero with n8n and AI

How it works, step by step

1. 1

   Watch the invoices label in Gmail

   The Gmail trigger polls for new emails with a PDF attachment under a label such as supplier-invoices, and downloads the attachments so the workflow can read them.

2. 2

   Split out each PDF attachment

   A Code node creates one item per PDF and keeps the sender, subject, received date and file name alongside it, so emails with several invoices are handled one invoice at a time.

3. 3

   Read the PDF text

   The Extract from File node pulls the text layer out of each PDF. Most invoices generated by accounting software have one. Scanned images with no text are caught later by the confidence check.

4. 4

   Extract the invoice fields with AI

   The Information Extractor node sends the text to your chat model with a fixed schema: supplier name, ABN, invoice number, invoice and due dates, currency, amount excluding GST, GST, total, line items and a confidence rating.

5. 5

   Check the extraction

   A Code node validates the ABN with the official checksum, confirms the subtotal plus GST equals the total, flags GST that looks too high, foreign currency, credit notes, missing fields and anything the model was not confident about.

6. 6

   Route clean invoices to Xero, others to review

   An If node sends invoices that passed every check to Xero. Everything else goes straight to the review queue with the list of reasons attached.

7. 7

   Find the supplier contact in Xero

   The Xero node searches your contacts by name. If no match is found, the invoice is flagged as a new supplier and sent to review rather than creating a contact automatically.

8. 8

   Create a draft bill in Xero

   For a known supplier, the Xero node creates a bill with status Draft, the supplier invoice number, dates, the amount excluding GST and the GST amount on your default expense account. It stays in Draft until someone approves it.

9. 9

   Log to the invoice register

   Each draft bill is appended to a Google Sheet with the supplier, ABN, amounts, file name and Xero bill ID, giving you a simple register to reconcile against Xero.

10. 10

    Ask a person to review exceptions

    Invoices that failed a check or have a new supplier are written to a Needs review tab, and a Slack message tells the bookkeeper what came in and why it needs a human look.

Set it up in n8n

1. 1

   Import the workflow JSON into n8n and open the Setup Notes sticky note.

2. 2

   In Gmail, create a label such as supplier-invoices and a filter that applies it to invoice emails. Match the label in the trigger's search query and set a polling interval.

3. 3

   Create a Xero OAuth2 credential in n8n, then select your organisation in the Find Supplier in Xero and Create Draft Bill in Xero nodes.

4. 4

   Replace YOUR_EXPENSE_ACCOUNT_CODE with the account code bills should default to, such as your general expenses account. The bookkeeper can recode lines in Xero before approving.

5. 5

   Create the Google Sheet with Invoice register and Needs review tabs, add the column headers used in the two Sheets nodes, and paste the sheet ID.

6. 6

   Add your OpenAI credential to the Chat Model node, or replace it with an Anthropic Chat Model connected to Extract Invoice Fields.

7. 7

   Choose the Slack channel in Ask Bookkeeper to Review.

8. 8

   Send yourself a few real supplier invoices, run the workflow manually and compare every draft bill against the PDF before activating it.

For Australian businesses

Frequently asked questions