🧾 Introduction
As a UK sole trader, staying on top of your accounts is more than just good practice — it’s the key to staying legal, stress-free, and ready for tax season.
Whether you’re full-time self-employed or freelancing part-time, the right accounting software can save hours of admin and help you stay compliant with Making Tax Digital (MTD).
In this guide, we’ll look at the best accounting software for UK sole traders in 2025 — with free, paid, and HMRC-compliant options.
✅ Best Accounting Software for UK Sole Traders (2025)
🔹 1. QuickBooks Self-Employed
- ✅ Designed specifically for sole traders and freelancers
- Tracks income, expenses, and mileage
- HMRC-compatible for MTD
- Mobile app makes bookkeeping easy
- Pricing: From ~£8/month
- 👉 Try QuickBooks
🔹 2. FreeAgent
- 💼 Especially popular with freelancers using NatWest, RBS or Mettle (free with those accounts)
- Handles invoicing, expenses, tax timeline, and even payroll
- Excellent for side-hustlers and creatives
- Pricing: Free (with certain banks) or from ~£14/month
- 👉 Use FreeAgent
🔹 3. Crunch
- 🧑💼 Designed for UK freelancers, sole traders, and contractors
- Includes human accountants (if you choose a higher tier)
- Offers free plan with basic features
- Paid plans include VAT filing, tax returns, and support
- 👉 Try Crunch
🔹 4. Zoho Books (Free for Small Businesses)
- 🧾 Part of the Zoho suite (like Zoho Invoice)
- Free for UK businesses under £35,000 turnover
- MTD-compliant for VAT
- Great for small sole traders and microbusinesses
- 👉 Start with Zoho Books
🔹 5. Xero
- 🧮 More powerful, best for fast-growing or VAT-registered sole traders
- Bank feeds, invoices, payroll, VAT returns
- Heavier learning curve than others
- Pricing: from ~£15/month
- 👉 Try Xero
⚖️ Comparison Table
| Tool | Free Plan | MTD-Compliant | Ideal For |
|---|---|---|---|
| QuickBooks | No | ✅ Yes | Side-hustlers, solo workers |
| FreeAgent | ✅ (with banks) | ✅ Yes | Bank users, creatives |
| Crunch | ✅ Basic | ✅ Yes | Freelancers needing support |
| Zoho Books | ✅ Yes | ✅ Yes | Low-income sole traders |
| Xero | No | ✅ Yes | Growing/complex businesses |
🔄 Related Tools
If you’re just starting out, pair your accounting software with:
❓ FAQs
Q: Do sole traders need accounting software by law?
If you’re VAT registered, yes — HMRC requires MTD-compliant software. If not, it’s still strongly recommended.
Q: What’s the cheapest MTD-compliant option?
QuickBooks, FreeAgent (if you bank with NatWest/RBS/Mettle), or Zoho Books if your income is low.
Q: Can I use spreadsheets instead?
You can, but software automates calculations, reduces errors, and makes tax filing 10x easier.
🧠 Final Thoughts
As a sole trader, you don’t need a big, clunky accounting setup — you just need the right tool for your size and style of business.
If you want something fast and flexible, start with QuickBooks or Zoho Books.
If you want all-in-one support (or a freebie through your bank), go with FreeAgent.