As questions about working with Xero in Germany keep coming in, and our time is limited, I will try to give a short outline of the procedure.
Accounting consists - in general terms - of 3 big components:
preparation of the final accounts, and
preparation of all tax declarations for the year in question.
On the other hand, broadly defined, accounting is the translation of tax law into numbers. Do not undervalue the principles of tax law, they are a crucial part of the accounting!
Xero is still not certified for Germany, and this is not just a formality. It means that, at least at present, Xero is unable to apply the German tax law for you, so if you want to use Xero, you would have to perform this task by yourself, outside of Xero.
Essentially, it comes to this: in Xero, you can only display German bookkeeping - for group reporting purposes in international companies, etc. The actual bookkeeping, the final accounts and the annual tax declarations you will have to do somewhere else or to pass on the task to your German CPA. If you try to do the bookkeeping directly in Xero - by the way, do not forget to set up the German standard chart of accounts (SKR03, SKR04, etc.) relevant to your kind of business -, you will have at the end of the year the problem that you cannot export the Xero bookkeeping data to transfer to your German CPA in a file format their system could use (DATEV, for example).
Now, here comes the magic: the truth is that if you know German tax law well and you are really good at maths, you do not need any software to do the bookkeeping for you, that is, to code your bookkeeping data. In other words, if you are able to correctly write down your bookkeeping on a blank sheet of paper, your would be able to code it in a simple spreadsheet or even in a text editor. Xero allows you to upload already coded bookkeeping data (as a CSV file, etc.) to their servers, so you could display, or showcase, your German bookkeeping there. In effect, you do two file format versions of your coded bookkeeping data: one for Xero, one for your CPA (probably DATEV). Do not forget: by German law, you are responsible for the accuracy of your bookkeeping, not the CPA.
Xero, or any other accounting software, in the cloud or local, does not do the bookkeeping, or the accounting, for you. It is a tool, no more and no less than that. You will need the relevant knowledge to use it in the right way.
MBA for Finance and Financial Services (UK), Steuerfachwirt (GER)