As a result of expansion into Australia, the firm says it expects to create over 50 new jobs in the next five years.

"Victoria gives Xero important advantages such as having a convenient headquarters to reach our expanding banking, finance and small business customer base as well as access to world-leading players," said Xero CEO Rod Drury.

Victorian ICT Minister John Lenders welcomed the move.

"With cloud computing continuing to boom in Victoria and globally, we will start to see more innovative companies like Xero taking advantage of our growing capability in developing and offering cloud services and infrastructure."

Last month San Francisco-based investor Peter Thiel dropped NZ$4 million to support Xero’s expansion into the US market.