There is no single best accounting software, and HMRC recommends none. On 19 October 2026, paid sole trader plans from the seven apps compared here started at £5 a month plus VAT, and five had a free route.
Accounting software does the day-to-day jobs: invoices and quotes, a bank feed, photos of receipts, sorting costs, and, for some trades, CIS and job costing. Under Making Tax Digital (MTD), it may also have to send HMRC an update every quarter. Unless you are exempt, MTD has applied since 6 April 2026 if your qualifying income, which is self-employment and property income before expenses, was over £50,000 in 2024-25. It starts on 6 April 2027 if it was over £30,000 in 2025-26, and on 6 April 2028 if over £20,000 in 2026-27.
Want your books sorted?
We sort your books and prepare your quarterly figures. You send them to HMRC yourself with free Making Tax Digital software.
Founding offer on Trades Tax (coming later), first 500 trades clients: £5 a month for your first 3 months, then £35 a month. Cancel any time. We’ll remind you before it changes. Prices include VAT. No payment is taken while you wait.
Are you ready for Making Tax Digital? Check your start date and what to sort first. It’s free and takes a minute.
Seven apps compared on price
Prices are each provider's entry plan for sole traders, as listed on its own UK pricing page on 19 October 2026.
| App and plan | Price as listed | Including VAT at 20% | Offers and limits |
|---|---|---|---|
| Xero Simple / Ignite | £7 / £18 a month + VAT | £8.40 / £21.60 a month | Simple is for non-VAT registered businesses: quotes, 10 invoices, receipt capture. Ignite adds 20 invoices, 10 bills and VAT returns. 90% off for 6 months for new UK customers; contractor CIS returns £5 a month + VAT extra on Ignite |
| QuickBooks sole trader plans | From £10 a month + VAT | From £12 a month | 90% off for 6 months for new customers who buy without the free trial; Sole Trader Plus has 1 user |
| FreeAgent sole trader | £19 a month + VAT, or £190 a year + VAT | £22.80 a month, or £228 a year | 50% off the first 6 months or first year; free with a NatWest, RBS or Ulster Bank business current account, or a Mettle account if you make at least one transaction a month; Smart Capture reads 10 receipts a month, unlimited for £5 a month + VAT |
| Pandle Pro | £5 a month + VAT | £6 a month | 14-day free trial; Pandle Free sends MTD and VAT returns but has no bank feeds |
| Clear Books Sole Trader | £5 a month + VAT; Sole Trader Plus £15 a month + VAT | £6 a month; £18 a month | Sole Trader Free sends MTD updates, no bank feed |
| Zoho Books Standard | £12 a month, or £10 a month billed yearly, excluding local taxes | £14.40 a month, or £12 a month | Free plan with 1,000 invoices a year, 1 user plus an accountant, 50 receipt scans a month; bank feeds on Standard |
| Coconut MTD filing | £129.99 a year | VAT not stated | Free trial, no card needed; free for 2 years with a Zempler account opened and connected in Coconut, with a deposit within 7 days |
What each app's page says it does
All seven pages say they handle MTD for Income Tax. A dash means the pricing page did not mention it, not that the app lacks it. The last column is from our MTD software census of HMRC's finder on 18 October 2026.
| App | Invoices and quotes | Bank feed and receipts | Jobs or projects | CIS on the pricing page | VAT on the pricing page | CIS on HMRC's finder |
|---|---|---|---|---|---|---|
| Xero Ignite | Quotes, 20 invoices | Yes, smart document capture | Ultimate plan | Subcontractor CIS calculations | VAT returns | Ready now |
| QuickBooks Sole Trader Plus | Invoices and estimates | Yes, receipt capture | Plus plan, not Sole Trader Plus | Subcontractor CIS; contractor returns from Simple Start | From Simple Start | Ready now |
| FreeAgent | Invoices and estimates | Yes, Smart Capture | Projects and time tracking | - | MTD VAT returns | Ready now |
| Pandle Pro | Quotes and invoices | Yes, receipt uploads | Projects | - | VAT returns | In development |
| Clear Books Sole Trader | Invoices | Yes, receipt scanning | - | Works for CIS subcontractors | Sole Trader Plus, with the domestic reverse charge | Ready now |
| Zoho Books | Invoices and quotes | Standard plan; receipt autoscans | Up to 3 on Free | Tracks CIS contractors | MTD VAT returns | In development |
| Coconut MTD filing | Unlimited invoices | Yes, snap receipts | - | - | - | In development |
On HMRC's finder, "in development" means the provider has committed to building the feature in time for the 2026 to 2027 tax return.
What this means for you
Start with what your work needs. A sole trader with a few customers, no VAT and turnover under £90,000 can record each item simply as income or expense under MTD, so a free or £5 plan may do.
Then check the extras:
- CIS. Contractors take 20% from a registered subcontractor's pay, or 30% if not registered, and nothing if you have gross payment status. HMRC adds those deductions to your MTD tax return and you must check them. If you also pay subcontractors, you file contractor returns too.
- VAT. You must register once taxable turnover for the last 12 months goes over £90,000, or if you expect it to in the next 30 days alone. Standard or reduced rate building work for VAT and CIS registered customers within CIS usually uses the domestic reverse charge, unless the customer is a private household or tells you in writing it is an end user or intermediary supplier. Only Clear Books' pricing page named it.
- Price after the offer. Several introductory deals end after 6 to 12 months, and most prices exclude VAT.
We're not software you run yourself. Our Trades Tax plan will keep your books from your bank feed. Coming later. Not available yet: starts once our HMRC registrations are complete. Once our registrations are complete, we'll send your quarterly updates and tax return to HMRC for you, after you confirm the figures. Our Trades Tax plan is £35 a month or £350 a year including VAT, and VAT returns add £10 a month including VAT on the monthly plan. We don't do CIS contractor returns, so if you pay subcontractors, software that files them is the better fit.
Steps to choose your software
- Use the free MTD check to see when MTD starts for you.
- List what you need: quotes, invoices, CIS, VAT, jobs, and any rent or other income.
- Shortlist two or three apps whose own pages list those features. If a contractor pays you under CIS, check CIS is ready now on HMRC's finder.
- Work out the full price including VAT after any offer ends.
- Try a free trial with one month of real jobs, receipts and bank transactions.
- Compare that with what a person would charge: see what bookkeeping costs a sole trader.
For the MTD side alone, see the best MTD software for sole traders. The trades section has more on CIS, VAT and MTD.
Hold your place on the trades waitlist
We’ll email you when Trades Tax opens, with the founding offer while places last. No payment is taken.
Questions people ask
Does HMRC recommend any accounting software?
No. GOV.UK says all software on its finder has been through HMRC's recognition process, and that HMRC does not recommend any product or software provider.
Is there free accounting software for sole traders?
Yes. On 19 October 2026 Pandle, Clear Books and Zoho Books listed free plans that send MTD updates, though Pandle's and Clear Books' free plans had no bank feed. FreeAgent was free with some business bank accounts, and Coconut for 2 years if you open a Zempler account through Coconut, connect it and pay money in within 7 days.
Do I need software that handles CIS?
If you are a CIS subcontractor, it helps. HMRC adds your CIS deductions to your MTD tax return and you must check them before you submit. On 18 October 2026, 47 products on HMRC's finder were ready now for sole traders and CIS.
Do I need full accounting software if my turnover is small?
Not always. GOV.UK says a sole trader with turnover under £90,000 can record each transaction simply as income or expense under MTD, so a simple app may be enough.
What if I pay subcontractors myself?
Then you are a CIS contractor too, with a monthly return to HMRC. Xero listed contractor CIS returns as a £5 a month add-on plus VAT on Ignite and above, and Zoho Books listed CIS returns on its Professional plan.
Sources
- Choose the right software for Making Tax Digital for Income Tax (GOV.UK, checked 19 October 2026)
- Find software for Making Tax Digital for Income Tax (GOV.UK software finder, our census read 18 October 2026, checked 19 October 2026)
- Use Making Tax Digital for Income Tax: Create digital records (GOV.UK, checked 19 October 2026)
- Find out if and when you need to use Making Tax Digital for Income Tax (GOV.UK, checked 19 October 2026)
- Use Making Tax Digital for Income Tax: Submit your tax return (GOV.UK, checked 19 October 2026)
- What you must do as a Construction Industry Scheme (CIS) subcontractor (GOV.UK, checked 19 October 2026)
- Register for VAT: When to register (GOV.UK, checked 19 October 2026)
- VAT domestic reverse charge for building and construction services (GOV.UK, checked 19 October 2026)
- Xero UK: Pricing plans (checked 19 October 2026)
- QuickBooks UK: Pricing (checked 19 October 2026)
- QuickBooks UK: Making Tax Digital software (checked 19 October 2026)
- FreeAgent: Pricing (checked 19 October 2026)
- Pandle: Pricing (checked 19 October 2026)
- Clear Books: Pricing (checked 19 October 2026)
- Zoho Books UK: Pricing (checked 19 October 2026)
- Coconut: Pricing (checked 19 October 2026)
This is general information to help you understand the rules. It isn't tailored to your circumstances, so check your own position before acting on it.
Righto Tax is a trading name of NJG Consultancy Ltd, registered in England and Wales, company number 16095900. Registered office: Jubilee House, East Beach, Lytham St Annes, FY8 5FT.
What happens next
- Use the free Making Tax Digital checker to see your own start date and deadlines.
- See what Righto Tax for Trades does for you, and join the waitlist.
- Questions about this page? Email hello@rightotax.co.uk.