Xero vs FreeAgent UK (2026)
A powerful all-rounder vs a freelancer favourite — we compare both platforms for UK sole traders, freelancers, and small businesses.
Our Verdict
Choose FreeAgent if you're a UK freelancer, sole trader, or contractor — especially if you bank with NatWest or RBS (making it free). Choose Xero if you're growing, have employees, need inventory management, or want a larger integration ecosystem.
Xero
Pros
- 1,000+ integrations
- Unlimited users
- Strong inventory management
- Excellent bank feeds
- Best for growing businesses
Cons
- More complex for sole traders
- Payroll is an add-on on Starter
- No phone support
FreeAgent
Pros
- Free with NatWest/RBS business accounts
- Purpose-built for UK freelancers & sole traders
- Excellent Self Assessment support
- Simple, uncluttered interface
- Strong time tracking
Cons
- Limited scalability for larger businesses
- Fewer integrations
- No inventory management
Frequently Asked Questions
Is Xero or FreeAgent better for freelancers?
FreeAgent is specifically designed for UK freelancers and sole traders, with excellent Self Assessment support, time tracking, and a simpler interface. Xero is better if you plan to grow, need more integrations, or have employees.
Is FreeAgent really free?
FreeAgent is free for NatWest, Royal Bank of Scotland, and Ulster Bank business account holders. Otherwise it costs £19/mo. This makes it exceptional value for those who bank with these providers.
Which is better for MTD, Xero or FreeAgent?
Both are fully MTD-compliant for VAT. FreeAgent has excellent MTD Income Tax preparation tools specifically designed for sole traders and freelancers.
Can I switch from FreeAgent to Xero?
Yes — you can export your data from FreeAgent and import it into Xero. It's easiest to switch at the start of a new financial year. Xero's migration guides can help with the process.