Xero allows two active tracking categories, each with up to 100 options. If you need to report by more than two things, such as job, region and department, Xero can't do it directly. Xero said in September 2026 that it is exploring improvements to tracking categories but can't commit to anything yet, so plan around the current limit. The usual workarounds are combining two dimensions into one category, using Xero Projects for jobs, using more detailed account codes, or keeping the extra detail in another system and reporting from both. The right choice depends on how many dimensions you need and who has to use the reports. This guide walks through each option and its trade-offs.
Why two categories run out quickly
Tracking categories let you tag transactions so you can run reports by something other than account code, such as a branch or a job. Two sounds like plenty until a business grows. Common combinations that hit the limit:
- Builders and trades: job, plus region, plus division (residential and commercial).
- Wholesale and distribution: branch, plus sales channel, plus product group.
- Professional services: office, plus service line, plus partner or client group.
- Groups and franchises: location, plus department, plus funding or grant source.
Once the third dimension appears, people start squeezing information into the categories they have, and the reports get harder to trust.
Option 1: Combine two dimensions into one category
For example, instead of "Region" and "Division", use one category with options like "QLD-Residential" and "QLD-Commercial", leaving the second category free for jobs.
Good for: a small number of combinations. Watch for: the option list grows quickly (three regions and three divisions is nine options) and you can't easily report on one dimension alone, such as all residential work across every region, without exporting to Excel.
Option 2: Use Xero Projects for jobs
Xero Projects tracks time, costs and invoicing per job, which can free both tracking categories for other things.
Good for: service businesses and smaller builders whose jobs are simple. Watch for: costs have to be assigned to the project as well as coded, which is easy to miss, and project reporting is separate from the main profit and loss reports.
Option 3: More detailed account codes
Some businesses add accounts such as "Sales – Commercial" and "Sales – Residential" to carry a dimension in the chart of accounts.
Good for: one extra dimension with only a few values. Watch for: the chart of accounts gets long, coding errors increase, and it becomes painful if you later change how you split the business.
Option 4: Keep the detail in another system and report from both
Often the extra detail already exists somewhere else: the job system knows the job, the stock system knows the product group, the payroll system knows the department. Instead of forcing it all into Xero, Xero keeps the accounts with one or two categories, and a reporting layer such as Power BI joins Xero with those systems by a shared code.
Good for: three or more dimensions, several entities, or reports that need operational detail Xero was never meant to hold. Watch for: it needs a consistent code that appears in both systems, such as a job number or branch code, and someone has to set the reporting up properly once.
Which option fits
- Two dimensions plus a simple third: combine categories (option 1) or use Projects for jobs (option 2). No extra cost.
- A third dimension with a few fixed values: account codes (option 3) can work, if you keep them tidy.
- Three or more dimensions, several entities, or reports that mix in job or stock data: keep the detail where it already lives and report across systems (option 4).
If you're unsure, start with the reports you actually need each month and work backwards. The dimensions that appear in those reports are the ones worth tracking properly.
Frequently asked questions
How many tracking categories can you have in Xero?
Two active tracking categories, each with up to 100 options.
Will Xero add more tracking categories?
It's been one of the most requested features on Xero's product ideas forum for years. In September 2026 Xero said it is exploring how to improve tracking categories but can't commit to anything yet, so it's safest to plan around the current limit for now.
Can a reporting app add more dimensions to Xero?
Reporting apps can only report on what is in Xero, so they can't add a dimension that isn't recorded somewhere. If the extra detail lives in another system, such as your job or stock system, a report that joins both systems can show it.
Should I move off Xero to get more reporting dimensions?
Usually not just for this. Larger systems do offer more dimensions, but moving is a big project. If the extra detail already exists in your other systems, reporting across them is usually quicker and cheaper than replacing Xero.
If you're stuck trying to fit three or more ways of slicing the business into Xero, see our Xero and MYOB reporting and dashboards service, or book a free initial chat. If combining categories or using Projects will do the job, we'll tell you that too.