Best Accounting Software UK 2026: Complete Comparison Guide
Choosing accounting software is one of the most important decisions for your UK business. The right choice saves hours each month, makes tax filing painless, and keeps you MTD-compliant. We have tested all the major options so you do not have to.
Quick Answer: For most UK small businesses, Xero (best overall), QuickBooks (best for self-employed), or FreeAgent (best for freelancers) are the top picks. See detailed comparison below.
UK Accounting Software Comparison Table 2026
| Software | Price/mo (ex VAT) | Free Trial | MTD VAT | MTD ITSA | Payroll | Rating |
|---|---|---|---|---|---|---|
| Xero | £15-55 | 30 days | Yes | Yes | Add-on £5/mo | 4.7/5 |
| QuickBooks | £14-38 | 30 days | Yes | Yes | Included (Adv.) | 4.5/5 |
| FreeAgent | £19 | 30 days | Yes | Yes | Included | 4.4/5 |
| Sage Accounting | £12-36 | 30 days | Yes | Yes | Add-on | 4.2/5 |
| Zoho Books | £10-20 | 14 days | Yes | Yes | Add-on | 4.1/5 |
| Bokio | Free – £6 | Free plan | Yes | Yes | No | 3.9/5 |
Prices as of April 2026 excluding VAT. Verify current pricing on provider websites before purchasing.
How to Choose Accounting Software
Check MTD Compliance
All VAT-registered UK businesses must use MTD-compatible software for VAT submissions. All software in this guide is fully MTD for VAT compliant. MTD for Income Tax (MTD ITSA) applies from April 2026 for those with income above 50,000 per year.
Match to Your Business Type
| Business Type | Best Pick | Why |
|---|---|---|
| Sole trader or freelancer | QuickBooks or FreeAgent | Affordable, self-assessment ready, easy to use |
| Small limited company (1-10 staff) | Xero | Bank feeds, invoicing, multi-user access, scalable |
| Contractor via limited company | FreeAgent | Built for contractors with dividends and IR35 tools |
| Budget-conscious small business | Bokio or Zoho Books | Low cost, MTD-ready, covers the basics |
Detailed Reviews
- Xero UK Review 2026 – our most detailed review, rated 4.7/5
- QuickBooks UK Review – best for self-employed and sole traders
- FreeAgent UK Review – built for freelancers and contractors
Frequently Asked Questions
Does accounting software have to be MTD compatible?
If your business is VAT-registered, yes. MTD for VAT has been mandatory since April 2022 for all VAT-registered businesses. All software reviewed on this page is fully MTD compliant.
What is the cheapest MTD-compliant accounting software?
Bokio offers a completely free plan with full MTD compliance. Zoho Books starts from 10 per month. Both are functional for small businesses with basic needs.
Can I switch accounting software mid-year?
Yes. Most software supports importing opening balances. The best time to switch is the start of your financial year, but mid-year switches are possible with most providers offering migration tools or support.