Ad · Partner offers: Tide £200 + Capital on Tap 7,500 points
Updated May 2026 · MTD for Income Tax edition

UK accounting software, compared in depth

We've run our own books on six of these seven tools across the last four tax years. This is the side-by-side we wish existed when we were choosing — pricing tiers, MTD readiness, who they're really for, and where each one falls down.

Feature & pricing matrix

All prices ex-VAT, monthly billing, May 2026
FeatureXeroFreeAgentQuickBooksCrunchSageANNAFreshBooks
Cheapest paid plan / mo£16£19 (free w/ NatWest/Mettle)£12£0 (free) / £29.50 Pro£15£0 (Free) / £24 Pro£15
Mid-tier / mo£33£29 Universal£24£71.50 Premium£30£36 Business£25
Top-tier / mo£59£39 Landlord+£36£159.50 Enterprise£39£100 Big Business£40
Free trial30 days30 days30 days + 90 % off 6 moFree plan1 monthFree plan30 days
Sole trader friendly✓✓✓✓—✓✓
Limited company friendly✓✓✓✓✓✓—
Self Assessment filing—✓✓✓———
Corporation Tax filing—✓—✓———
Confirmation statement filing———✓———
MTD for VAT✓✓✓✓✓✓✓
MTD for Income Tax ready✓✓✓✓✓✓—
Bank feeds21,000+Most UK banksAll majorAll majorAll majorAll major + own accountMost major
Built-in invoicing✓✓✓✓✓✓✓
Recurring invoices✓✓✓✓✓✓✓
Payment links (Stripe/GoCardless)✓✓✓✓✓✓✓
Quotes / estimates✓✓✓✓✓✓✓
CIS support✓✓✓✓✓——
Multi-currencyTop tier onlyIncludedTop tier onlyPremium+✓Pro+Plus+
Inventory / stock✓—✓—✓——
Project tracking✓✓Plus+—✓—✓
Payroll add-on£6/mo + £1/employeeIncluded£4/mo + £1/employeeIncluded£10/mo——
Mobile appExcellentGoodExcellentOKGoodExcellentGood
Real human accountant———✓Add-on——
Open Banking business account—————✓—
Best forGrowing Ltds, agenciesSole traders & contractorsMulti-client freelancersFounders who hate adminConstruction & inventoryNewly self-employedSolo service businesses

Full pricing ladder by provider

FeatureXeroFreeAgentQuickBooksCrunchSageANNAFreshBooks
Plan 1Ignite — £16Universal — £19Sole Trader — £12Free — £0Accounting Start — £15Free — £0Lite — £15
Plan 2Grow — £33Landlord — £29Simple Start — £14Pro — £29.50Accounting Standard — £30Pro — £24Plus — £25
Plan 3Comprehensive — £47Landlord+ — £39Essentials — £24Premium — £71.50Accounting Plus — £39Business — £36Premium — £40
Plan 4Ultimate — £59—Plus — £36Enterprise — £159.50—Big Business — £100Select (custom)

Headline prices only. Most providers run 50-90 % off promos for new customers for 3-6 months — budget for the list price at renewal.

Provider deep dives

Xero

The default for growing UK Ltds

Best for: Limited companies, agencies and any business with an external accountant

Pricing
£16 Ignite · £33 Grow · £47 Comprehensive · £59 Ultimate. Payroll £6/mo + £1/employee.

Pros
  • Best-in-class ecosystem — 1,000+ app integrations including Stripe, GoCardless, Dext and HubSpot.
  • Almost every UK accountant is Xero-certified, so handing over books is friction-free.
  • Reporting and multi-user permissions scale into multi-employee Ltds without changing tools.
Cons
  • No Self Assessment or Corporation Tax filing — you (or your accountant) still file separately.
  • Ignite plan is genuinely thin: 20 invoices and 5 bills per month is easy to outgrow.
  • Most useful features (multi-currency, projects, expenses) live on the top tier.
Our verdict

If you're going to hire an accountant or already have one, Xero is the safe long-term bet — every UK accountant knows it cold.

Worth it? Yes — once you're issuing 20+ invoices a month or running a Ltd with payroll.

FreeAgent

The sole trader and contractor favourite

Best for: Sole traders, contractors and small Ltds who want to file Self Assessment in-app

Pricing
Free with a NatWest, RBS, Mettle or Ulster business account. Otherwise £19 Universal · £29 Landlord · £39 Landlord+. Payroll is included for up to 5 employees.

Pros
  • Genuinely free for the lifetime of your NatWest/Mettle business account — biggest single saving in this comparison.
  • Files Self Assessment SA100/SA103 and Corporation Tax CT600 directly to HMRC.
  • Payroll for up to 5 employees included on every paid plan.
Cons
  • Reporting is weaker than Xero or QuickBooks when you scale past ~10 employees.
  • App ecosystem is much smaller than Xero's.
  • UI is starting to feel dated next to QuickBooks and ANNA.
Our verdict

The best value in UK accounting if you bank with NatWest, RBS, Mettle or Ulster. For solo contractors there is almost no reason to pick anything else.

Worth it? Yes, especially if you can get it free via a NatWest-group account.

QuickBooks

The MTD workhorse for multi-client freelancers

Best for: Freelancers juggling multiple clients, and small businesses who like a slick mobile app

Pricing
Sole Trader £12 · Simple Start £14 · Essentials £24 · Plus £36. Payroll add-on from £4/mo + £1/employee. Frequent 90 % off 6-month offers.

Pros
  • Files Self Assessment from the Sole Trader plan — the cheapest fully MTD-for-IT route.
  • Best mobile app in this comparison: receipt capture and on-the-go invoicing are genuinely usable.
  • Constant new-customer discounts make the first 6-12 months very cheap.
Cons
  • Price jumps a lot at renewal — budget for the full list price after the intro period.
  • Sole Trader plan is a walled garden: you can't upgrade in place to Simple Start without re-entering data.
  • Customer support has a reputation for being hit-and-miss.
Our verdict

Pick QuickBooks if you want MTD for Income Tax sorted on the cheapest possible plan and you live in the mobile app.

Worth it? Yes for sole traders close to the MTD-IT threshold. Watch the renewal price.

Crunch

Software + a real accountant in one bill

Best for: Founders who genuinely don't want to touch the books or speak to HMRC

Pricing
Free (DIY) · Pro £29.50/mo · Premium £71.50/mo · Enterprise £159.50/mo. Paid tiers include a named accountant, payroll, VAT and year-end filing.

Pros
  • Pro and above include a named, ICAEW-qualified accountant — not just chat support.
  • Year-end accounts, Corporation Tax, Self Assessment and confirmation statements all included on Premium.
  • Free plan is a legitimate way to keep books tidy before you can justify the spend.
Cons
  • More expensive than Xero + an independent accountant once you're past a few employees.
  • Less flexible — you're inside Crunch's workflow, not industry-standard software.
  • Migrating away later means re-keying or paying for an export project.
Our verdict

Crunch is essentially an accountancy firm with software bolted on. If admin paralyses you, that bundling is worth the premium.

Worth it? Yes if you'd otherwise pay £100+/mo for an accountant anyway.

Sage Business Cloud

The legacy choice for trades and inventory

Best for: Construction, trades, retailers and any business with real stock or CIS

Pricing
Accounting Start £15 · Accounting Standard £30 · Accounting Plus £39. Payroll from £10/mo. Often discounted 50 % for 3-6 months.

Pros
  • Strong CIS, stock and project costing — the bits Xero charges extra for.
  • Long-established UK brand, well-supported by traditional accountants.
  • Solid VAT and MTD compliance with a clear audit trail.
Cons
  • UI is the most dated of any tool here — feels like 2018 desktop software in a browser.
  • Smaller third-party app ecosystem than Xero or QuickBooks.
  • Sole trader experience is an afterthought; really designed around Ltds.
Our verdict

Worth considering if you're in a trade, run stock, or your accountant insists on Sage. Otherwise skip.

Worth it? Yes for construction, manufacturing or inventory-heavy businesses.

ANNA Money

A business account that does your bookkeeping

Best for: Newly self-employed and very early-stage Ltds who want one app for everything

Pricing
Free account · Pro £24 · Business £36 · Big Business £100. Business and above include VAT filing and a payroll-style salary tool.

Pros
  • Combines a real business account with bookkeeping, invoicing and VAT in one app.
  • Auto-categorises every transaction the second it hits your account.
  • Generous free tier — invoicing and basic bookkeeping at £0.
Cons
  • Not full double-entry accounting — your accountant may still ask you to export to Xero or FreeAgent.
  • Less powerful reporting than dedicated accounting software.
  • You're tied to ANNA's banking — moving banks means re-doing the setup.
Our verdict

Perfect for year one. Reassess once your turnover passes ~£60k or you take on an accountant.

Worth it? Yes for the first 12-24 months of a new business.

FreshBooks

The cleanest invoicing experience for solo service businesses

Best for: Solo consultants, designers and coaches who live in invoices and time tracking

Pricing
Lite £15 · Plus £25 · Premium £40 · Select (custom). No UK payroll. No Self Assessment filing.

Pros
  • The nicest invoicing, retainer and time-tracking flow of any tool here.
  • Excellent client portal — clients can view, comment and pay in one place.
  • Strong project profitability views for service businesses.
Cons
  • Not designed around UK Ltd accounting — best for sole traders.
  • No Self Assessment or Corporation Tax filing.
  • Lite plan caps you at 5 billable clients — easy to outgrow.
Our verdict

Pick FreshBooks if invoicing and time tracking are 80 % of your finance workload and you have an accountant for the rest.

Worth it? Yes for solo service businesses who already use a separate accountant.

Pick by situation

Brand-new sole trader under £30k turnover

Just registered with HMRC, a handful of clients, no employees, no VAT.

We'd pick
FreeAgent (free with Mettle) or ANNA Free

Zero monthly cost, MTD-ready, and both will see you through to your first Self Assessment without forcing an upgrade.

Contractor or freelancer running a Ltd

One-person Ltd, IR35-aware, paying yourself a small salary and dividends.

We'd pick
FreeAgent (free via NatWest/Mettle) or Xero Grow

FreeAgent files Self Assessment and CT600 directly. Xero is better if you plan to grow past 2-3 employees within 18 months.

Multi-client freelancer who lives on their phone

5-15 invoices a month, lots of receipt capture, frequent travel.

We'd pick
QuickBooks Sole Trader or Simple Start

The mobile app is meaningfully better than anything else here and Sole Trader is the cheapest fully MTD-IT path.

Growing agency or product Ltd

3-15 employees, monthly payroll, foreign suppliers, an external accountant.

We'd pick
Xero Grow or Comprehensive + Gusto/Payroll add-on

Best ecosystem, best reporting, every accountant on Earth speaks it, and the per-seat pricing stays sensible.

Trade, construction or stock-based business

CIS subcontractors, stock movement, on-site jobs.

We'd pick
Sage Accounting Plus or Xero Comprehensive

Sage handles CIS and stock without bolt-ons. Xero matches it once you add the inventory module on the top tier.

Founder who refuses to touch accounting

Wants to forward HMRC emails to a human and never log in.

We'd pick
Crunch Premium

The £71.50/mo includes a named accountant, year-end accounts, CT600 and Self Assessment — replacing a £100-£150/mo independent accountant.

How to actually choose (in five minutes)

  1. 01

    Do you bank (or could you bank) with NatWest, RBS, Mettle or Ulster? If yes, FreeAgent is free for the lifetime of your account — start there.

  2. 02

    Will your gross self-employment income exceed £50k in 2026/27? If yes, you need MTD-for-IT software — exclude FreshBooks.

  3. 03

    Will you have an external accountant? If yes, ask which software they prefer — usually Xero, FreeAgent or QuickBooks.

  4. 04

    Do you have stock, CIS subcontractors, or projects with materials? If yes, lean Sage or Xero Comprehensive.

  5. 05

    Do you want a human to handle year-end and tax filings? If yes, price Crunch Premium against a local accountant + Xero.

  6. 06

    Still undecided? Start on the cheapest plan that ticks your MTD box — the migration cost in 12 months is small.

Frequently asked questions

+What is Making Tax Digital (MTD) and do I need to care in 2026?

MTD for VAT already applies to every VAT-registered business. MTD for Income Tax Self Assessment (MTD-IT) starts in April 2026 for sole traders and landlords with gross income over £50k, and April 2027 for those over £30k. All seven tools above are HMRC-recognised for MTD-IT except FreshBooks at time of writing.

+Can I just use a spreadsheet?

If you're under the VAT threshold and under £50k self-employment income you legally can — but you'll have to switch by April 2026 or 2027 anyway. Starting on accounting software now means you don't have to re-key history later.

+Should I file my own Self Assessment or use the software?

If your finances are simple (one self-employment, no foreign income, no CGT) and you use FreeAgent, QuickBooks or Crunch, filing in-app is fine and saves an accountant's £150-£300 fee. Anything more complicated, pay an accountant.

+What about Wave, Zoho Books or Pandle?

Wave pulled out of the UK in 2023. Zoho Books is solid and cheap (£10/mo) but has tiny UK accountant adoption. Pandle is a free Bristol-based option from accountants Bright — fine for bookkeeping but lighter on reporting than the tools above.

+Can I switch later?

Yes — every tool above exports CSV/Excel and most accountants will migrate you for £100-£300. The pain is real but one-off. Don't let lock-in stop you starting.

+Do I need payroll software too?

If you run a Ltd and pay yourself a salary, yes. FreeAgent and Crunch include it; Xero, QuickBooks and Sage charge a small add-on. ANNA and FreshBooks don't do payroll — use BrightPay (£139/yr) alongside.

Related reading

The tools work better when the structure underneath them is right.

Tool
Sole trader vs Ltd
Tool
VAT calculator
Guide
Tax & HMRC essentials

Pricing and feature parity verified May 2026 against each provider's public UK pricing pages. Startup Edit is independent — we may earn a referral fee from some providers, but it never affects ranking or verdict.