FreeAgent vs Xero for Making Tax Digital
Both are recognised by HMRC for Making Tax Digital for Income Tax. Here is what each one supports today, according to HMRC's own software finder, and what each costs on its own pricing page — all checked on 9 October 2026. No opinions, no star ratings: just the differences that matter for your situation.
The short answer
Choose FreeAgent if…
- you need to report a salary (PAYE), dividends, State Pension, private pensions, partnership income and 7 more in your tax return — FreeAgent supports them now; Xero lists them as in development
- you need accessibility features (vision, hearing, motor or physical and cognitive)
- you want a free option — free while you keep a NatWest, RBS or Ulster business account; Mettle requires one transaction a month
- you want the lower listed entry price — FreeAgent from £10/month + VAT (Unincorporated landlord plan) against £18/month + VAT (Ignite plan) for Xero
Choose Xero if…
- you have foreign rental income — Xero handles it today; FreeAgent lists it as not included
Not sure either fits?
Our 2-minute check compares every HMRC-recognised product with your exact income — salary, dividends, foreign property included.
At a glance
| FreeAgent | Xero | |
|---|---|---|
| Free option | Free while you keep a NatWest, RBS or Ulster business account; Mettle requires one transaction a month | No |
| Paid plans from | £10/month + VAT · Unincorporated landlord | £18/month + VAT · Ignite |
| Free trial | 30-day free trial | One month free |
| Keeps digital records | Ready now | Ready now |
| Bridging (spreadsheets) | Not included | Not included |
| Final tax return | Yes | Yes |
| Sole trader income | Ready now | Ready now |
| UK property income | Ready now | Ready now |
| Foreign property income | Not included | Ready now |
| MTD for VAT | Ready now | Ready now |
| Agent software (for your accountant) | Ready now | Ready now |
| Other income items ready now | 16 of 16 | 4 of 16 |
| Other income items in development | 0 of 16 | 12 of 16 |
| Accessibility features | 4 of 4 | 0 of 4 |
Every HMRC-listed feature, side by side
HMRC lists the same features for every recognised product. FreeAgent and Xero differ on 17 of them (highlighted). “In development” means the provider has committed to HMRC to build it in time for the 2026 to 2027 tax return.
| Feature | FreeAgent | Xero |
|---|---|---|
| What it can send to HMRC | ||
| Quarterly updates | Yes | Yes |
| Tax return | Yes | Yes |
| Features provided | ||
| Free version | Not included | Not included |
| Agent software | Ready now | Ready now |
| Individual software | Ready now | Ready now |
| Standard update period (6 April to 5 April) | Ready now | Ready now |
| Calendar update period (1 April to 31 March) | Ready now | Ready now |
| Software that creates digital records | Ready now | Ready now |
| Bridging software that connects to records | Not included | Not included |
| Making Tax Digital for VAT | Ready now | Ready now |
| Blindness or impaired vision | Ready now | Not included |
| Deafness or impaired hearing | Ready now | Not included |
| Motor or physical difficulties | Ready now | Not included |
| Cognitive impairments | Ready now | Not included |
| HMRC Assist (Submission Feedback) | Not included | Not included |
| Business income sources | ||
| Sole trader | Ready now | Ready now |
| UK property | Ready now | Ready now |
| Foreign property | Not included | Ready now |
| Other income sources and items | ||
| UK interest | Ready now | Ready now |
| Employment (PAYE) | Ready now | In development |
| UK dividends | Ready now | In development |
| State Pension income | Ready now | In development |
| Private pension incomes | Ready now | In development |
| Partner income from a partnership | Ready now | In development |
| Foreign dividends | Ready now | In development |
| Foreign interest | Ready now | Ready now |
| Private pension contributions | Ready now | Ready now |
| Construction Industry Scheme | Ready now | In development |
| Charitable giving | Ready now | Ready now |
| Capital Gains | Ready now | In development |
| Student Loan | Ready now | In development |
| Marriage Allowance | Ready now | In development |
| Voluntary Class 2 National Insurance | Ready now | In development |
| High Income Child Benefit Charge | Ready now | In development |
Prices
FreeAgent
| Sole trader (monthly) | £19/month + VATPromo 50% off first 6 months (£9.50) |
|---|---|
| Sole trader (annual) | £15.83/month (billed yearly) + VAT£190/year; promo £95 first year |
| Unincorporated landlord (monthly) | £10/month + VATPromo £5 first 6 months |
| Unincorporated landlord (annual) | £8.33/month (billed yearly) + VAT£100/year; promo £50 first year |
| Free via NatWest/RBS/Ulster/Mettle | FreeFree while you keep a NatWest, RBS or Ulster business account; Mettle requires one transaction a month |
Free option: Free only through partner bank accounts (NatWest, RBS, Ulster Bank, Mettle)
HMRC lists the free version separately: FreeAgent for free with Mettle, NatWest & RBS.
Trial: 30-day free trial
Checked on 9 October 2026 on FreeAgent’s pricing page. Promotions change often.
Xero
| Ignite | £18/month + VATPromo new UK customers: 90% off first 6 months (£1.80) |
|---|---|
| Grow | £39/month + VATPromo £3.90 first 6 months |
| Comprehensive | £55/month + VATPromo £5.50 first 6 months |
| Ultimate | £70/month + VATPromo £7 first 6 months |
Trial: One month free
Checked on 9 October 2026 on Xero’s pricing page. Promotions change often.
Sources: HMRC software finder for Making Tax Digital for Income Tax (Open Government Licence v3.0) — FreeAgent and Xero, checked 9 October 2026; providers' pricing pages as linked above. HMRC does not recommend any product. Clarpilot compares on these data only: commissions never change what we show.