Cheap accounting software in the UK starts at around £5 a month, but the headline price is often not what you'll pay. Many providers advertise a big discount for the first three or six months, then the price jumps. Others look cheap until you need payroll, more invoices or a second user.
The fair way to compare is the yearly cost once the offer ends, for the plan that actually covers what you need to file. This guide does that for sole traders, landlords and small limited companies, using prices published in October 2026.
What makes accounting software cheap (or not)
Three things decide what you really pay:
- The ongoing price. Look for the price after the introductory discount. Xero's offer, for example, is 90% off for the first six months, then full price.
- Plan limits. Entry plans often cap invoices, bills or users. Xero's Ignite plan allows 20 invoices and 10 bills a month. Go over, and you need the next plan up.
- Add-ons. Payroll, multi-currency, stock control, receipt scanning and extra users are often extra.
Cheap software that makes you upgrade in month three isn't cheap.
Cheapest accounting software UK: yearly costs compared
Ongoing yearly cost excluding VAT, paying monthly, for the plan a typical business of each type would need. Year 1 is lower for providers with an intro discount.
Sole traders
| Software | Year 1 | Every year after |
|---|---|---|
| Xero Ignite | £118.80 | £216 |
| FreeAgent | £171 | £228 (free with some banks) |
| Zoho Books | Free plan or £120 | Free plan or £120 (Standard, billed yearly) |
| AccLedger | £75 (yearly plan) | £75 |
Landlords
| Software | Year 1 | Every year after |
|---|---|---|
| FreeAgent Landlord | £90 | £120 (free with some banks) |
| AccLedger Landlord | £50 (yearly plan) | £50 |
Small limited companies
| Software | Year 1 | Every year after |
|---|---|---|
| Xero Grow | £257.40 | £468 |
| FreeAgent | £297 | £396 (free with some banks) |
| AccLedger | £100 (yearly plan) | £100, including CT600 and Companies House accounts |
Notes: Xero's Grow plan is shown for companies because Ignite's invoice and bill caps are tight for most trading companies. Other add-ons are not included in the competitor figures.
Add-ons that make cheap software expensive
Before you choose, list what you'll need in the next year, not just today:
- Payroll. Paying yourself as a director or taking on one employee often means an add-on.
- Corporation Tax and year-end accounts. Many products don't file a CT600 or Companies House accounts at all, so companies pay an accountant or separate software for them.
- Multi-currency. If you buy or sell abroad, this is often on a higher plan.
- Stock control. Usually on a higher plan, if available at all.
- Extra users. Adding a business partner or bookkeeper can mean a higher plan.
The cheapest way to stay MTD-compliant
If all you need is to meet Making Tax Digital rules, you may not need full accounting software at all:
- VAT only, records in a spreadsheet? Use bridging software to send your VAT return from the spreadsheet. See bridging vs full MTD VAT software.
- Just one VAT return to file? A pay-per-return service can be cheaper than a monthly plan.
- Very few transactions? A free plan may be enough. See our guide to free accounting software for the options and their limits.
- Limited company with an accountant doing the books? You might only need a way to file the CT600 and Companies House accounts. See how to file a CT600.
Cheap accounting software checklist
- Write down everything you must file this year: VAT, MTD Income Tax quarterly updates, payroll, CT600, Companies House accounts.
- Find the plan that covers all of it, not the cheapest plan on the page.
- Work out the yearly cost after the intro offer, including add-ons.
- Check yearly billing. It's often 15–20% cheaper than paying monthly.
- Check the limits on invoices, bills, users and transactions.
- Use the free trial with your real bank data before you pay.
- Make sure you can export your data if you move later.
Low-cost accounting software with AccLedger
AccLedger has one plan per business type, with no feature tiers and no intro price that doubles later:
| Plan | Monthly | Yearly |
|---|---|---|
| Landlord | £5 | £50 |
| Sole trader | £7.50 | £75 |
| Limited company | £10 | £100 |
Prices exclude VAT. Every plan includes bank feeds, unlimited invoicing and MTD filing. The limited company plan also includes payroll for up to 5 employees, stock control, multi-currency, and your CT600 and Companies House accounts.
Don't need a subscription? File a single VAT return for £4.99 + VAT, a CT600 for £39 + VAT, or Companies House accounts for £19 + VAT. See pricing.
Start a 30-day free trial — no card needed.
FAQs
What is the cheapest accounting software in the UK? Free plans such as Zoho Books, or FreeAgent if you bank with NatWest, RBS or Ulster Bank, cost nothing. Among paid software, plans start at around £5 a month.
Is cheap accounting software HMRC-recognised? Price says nothing about it. Check HMRC's software list for each product, for both VAT and MTD Income Tax if you need them.
Why does my accounting software bill keep going up? Usually because an introductory discount has ended, a provider has raised its prices, or you've gone over a plan limit and been moved up a tier.
Is yearly billing cheaper? Usually, yes. Most providers, including AccLedger, charge less overall if you pay for a year upfront.
Can a limited company use cheap accounting software? Yes, but check it covers payroll, Corporation Tax and Companies House accounts. Those are often where the extra costs are.
Should I pay an accountant or use cheap software? Many small businesses do both: cheap software for day-to-day records, and an accountant for advice and year-end. Good records cut your accountant's bill.
This article is general guidance based on providers' published prices as of October 2026. It is not tax advice. Prices exclude VAT and change often; check each provider's website before you buy.