Xero is best overall for integrations. FreeAgent is best for CIS subcontractors. QuickBooks Self-Employed (£10/mo) is best budget option.
Getting accounting right isn't optional. Making Tax Digital (MTD) for VAT is here, and MTD for Income Tax starts April 2026. You need digital records and compliant software.
Quick Comparison
| Software | Best For | Price | CIS | MTD |
|---|---|---|---|---|
| Xero | Integrations | £14-38/mo | ✓ | ✓ |
| FreeAgent | CIS Subcontractors | £19-29/mo | ✓✓ | ✓ |
| QuickBooks | Budget | £10-25/mo | ✓ | ✓ |
Xero: Best Overall
Xero
Xero integrates with virtually every job management app. Bank feeds work flawlessly. Most accountants know it well. MTD compliant for VAT and Income Tax.
✓ Pros
- Best app integrations
- Excellent bank automation
- Accountant-friendly
- Strong mobile app
✗ Cons
- More expensive
- CIS not as good as FreeAgent
FreeAgent: Best for CIS
FreeAgent
Built for UK self-employed. CIS handling is the best in class - tracks deductions, generates statements, calculates your actual liability. Free with some business bank accounts.
✓ Pros
- Best CIS handling
- Built for UK self-employed
- Free with some banks
- Excellent Self Assessment
✗ Cons
- Fewer integrations
- Less suitable for Ltd companies
QuickBooks: Best Budget
QuickBooks
QuickBooks Self-Employed at £10/month is the most affordable MTD-compliant option. Good mileage tracking. Many accountants prefer it.
Making Tax Digital
MTD for VAT — Already in effect. Must use compatible software for VAT returns.
MTD for Income Tax — April 2026 for self-employed over £30,000. Quarterly digital updates required.
CIS Tax Explained
Construction Industry Scheme affects builders, plumbers, electricians working on construction sites. Contractors deduct 20% (or 30% if unregistered) and send to HMRC. Accounting software tracks this automatically.