Key takeaways
- There is no single best package; the right one depends on your business type, VAT status and Making Tax Digital needs. HMRC itself says it does not recommend any product.
- Entry prices checked on 6 November 2026 range from £0 (Pandle Free, Zoho Books Free) to £18 a month (Xero Ignite), all excluding VAT.
- FreeAgent is free with a NatWest, RBS or Ulster Bank business current account, and for sole traders and companies with a Mettle account; otherwise it costs from £19 a month ex VAT.
- Xero's plans run from £18 to £70 a month ex VAT, and every plan is marked as ready for MTD for Income Tax and VAT returns.
- MTD for Income Tax applies to sole traders and landlords with qualifying income over £50,000 from 6 April 2026, over £30,000 from 6 April 2027 and over £20,000 from 6 April 2028.
- Introductory discounts are common, such as Xero's 90% off for six months, so compare the price you will pay after the offer ends.
There is no single best accounting software for every UK small business. The right choice depends on whether you are a sole trader, landlord or limited company, whether you are VAT registered, and what Making Tax Digital (MTD) requires of you. This page compares six widely used packages on objective measures: entry price, free options and MTD support, using prices from each provider’s own website on 6 November 2026.
How we compared the software
We list packages alphabetically and do not rank, score or pick a winner. Every price comes from the provider’s own pricing page, checked on 6 November 2026, and excludes VAT unless stated. HMRC takes the same neutral line: its MTD for Income Tax software finder (updated 13 July 2026) says “HMRC does not recommend any product or software provider.”
Accounting software prices compared
The table shows each provider’s cheapest paid plan and whether a free option exists.
| Software | Entry paid plan (ex VAT) | Free option |
|---|---|---|
| FreeAgent | £19 a month (sole trader) | Yes, with selected bank accounts |
| Pandle | £5 a month (Pro) | Yes, Pandle Free |
| QuickBooks | £16 a month (Simple Start) | No, 30-day trial |
| Sage Accounting | Not confirmed (see below) | No |
| Xero | £18 a month (Ignite) | No |
| Zoho Books | £12 a month (Standard) | Yes, Zoho Books Free |
Prices change often and sign-up discounts are common. See our accounting software prices page for the full plan-by-plan list.
The six packages in brief
FreeAgent
FreeAgent’s pricing page lists £19 a month for sole traders, £27 for partnerships and LLPs, and £33 for limited companies, with a 50% discount for the first six months. It is free for as long as you keep a NatWest, RBS or Ulster Bank business current account, and for sole traders and companies with a Mettle account used at least once a month. The sole trader plan includes MTD for Income Tax, VAT returns, Self Assessment and payroll.
Pandle
Pandle has a free plan and a Pro plan at £5 a month plus VAT. Pro lists bank feeds, receipt uploads, unlimited users, multiple currencies, MTD for Income Tax submissions and VAT return submissions. The pricing page does not set out what the free plan includes, so check before relying on it for MTD.
QuickBooks
Intuit’s QuickBooks UK Plus page gives Simple Start at £16, Essentials at £33, Plus at £47 and Advanced at £115 a month plus VAT. MTD VAT returns are available on all four; multi-currency is listed from Essentials up, and payroll is a paid add-on. The main pricing page did not display live prices when we checked, so confirm the figure at checkout.
Sage Accounting
Sage sells Start, Standard and Plus plans. Sage’s website blocked our checks on 6 November 2026, so we could not confirm current prices from its pricing page. Check sage.com/en-gb directly for the live price and any offer.
Xero
Xero UK lists Ignite at £18, Grow at £39, Comprehensive at £55 and Ultimate at £70 a month. New customers can get 90% off for six months. Ignite caps you at 20 invoices and 10 bills a month. All plans submit VAT returns and are marked “MTD for Income Tax ready”; multi-currency starts at Comprehensive. Compare it side by side in QuickBooks Online vs Xero.
Zoho Books
Zoho Books UK has a Free plan with up to 1,000 invoices a year, then Standard at £12, Professional at £24 and Premium at £30 a month, with lower rates if billed annually. All plans, including Free, file MTD VAT returns and support MTD for Income Tax. Bank feeds start at Standard and multi-currency at Professional.
Which features do you need?
Work through these questions before you compare prices.
- If you are a sole trader or landlord with qualifying income over £50,000, you must already use MTD-compatible software from 6 April 2026. HMRC’s eligibility guidance lowers the threshold to £30,000 from 6 April 2027 and £20,000 from 6 April 2028. See the £30,000 MTD threshold.
- If you are VAT registered, you need software that files MTD VAT returns.
- If you invoice in foreign currencies, check that multi-currency is on your plan, as it often starts on a mid-tier plan.
- If you employ staff, check whether payroll is included or a paid add-on, and how many employees it covers.
- If you bank with NatWest, RBS, Ulster Bank or Mettle, check whether you qualify for free FreeAgent. Our guide to free business bank accounts covers the banks.
How to choose: a checklist
- List what HMRC requires of you: MTD for VAT, MTD for Income Tax, or neither yet.
- Note your volumes: invoices, bills and users each month.
- Shortlist packages whose entry plan covers those needs, not just the cheapest headline price.
- Compare the price after any introductory offer ends.
- Use the free trial with your real bank feed for a month.
- Ask your accountant which software they support; many firms work mainly in one or two.
Our guide to MTD software requirements explains what “compatible” software must do.
Frequently asked questions
What is the cheapest accounting software in the UK?
Pandle Free and Zoho Books Free cost nothing, and FreeAgent is free with selected bank accounts. Among paid plans we checked, Pandle Pro is the lowest at £5 a month plus VAT.
Does HMRC provide free accounting software?
HMRC’s software finder lists third-party products that have passed its recognition process, some with free versions. It says it does not recommend any of them.
Is Xero or QuickBooks cheaper?
At entry level, QuickBooks Simple Start is £16 a month and Xero Ignite is £18 a month, both excluding VAT. Both run frequent sign-up discounts, so compare the full-price figure.
Do prices include VAT?
No. Every price on this page excludes VAT at 20%. A VAT-registered business can usually reclaim that VAT.
Sources
Rates, thresholds and rules in this guide were checked against HMRC and GOV.UK guidance on 6 November 2026. Tax rules change, so check the current position on GOV.UK or with a qualified adviser before acting. This guide is general information, not personal advice.