OCTIS vs FreeAgent vs Xero for UK sole traders and companies

Prices, the free FreeAgent offer, and how Making Tax Digital for Income Tax and VAT affects the choice.

Last checked 9 November 2026 · 8 sources

Otty's short answer

Both are set up for Making Tax Digital for Income Tax and VAT, so MTD does not separate them. Price does. FreeAgent is £19 per month for a sole trader and £33 for a limited company, and free with a NatWest, RBS or Ulster Bank business account. Xero starts at £18 and adds payroll for one person from Grow at £39 and multi-currency from £55. Pick FreeAgent for simple books and the free route, Xero for add-ons.

Side by side

Swipe to see every column

What matters	OCTISHong Kong company + OCTIS global plan	FreeAgent	Xero
Sole trader, per month	Not published: 10–30% below your current bill	£19	£18 (Ignite)
Limited company, per month	Hong Kong company, run on the OCTIS global plan	£33	£18 to £70 by plan
Partnership or LLP, per month	10–30% below your current bill	£27	£18 to £70 by plan
Landlord plan, per month	10–30% below your current bill	£10	No separate plan
Introductory offer	Lowest Price Guarantee, terms apply	50% off first 6 months	90% off first 6 months
Free with a business bank account	Accounting built in with your OCTIS plan	NatWest, RBS, Ulster, Mettle	No
Free trial	30-day money-back guarantee, terms apply	30 days	1 month
MTD for Income Tax	Not needed for the Hong Kong company; local rules apply if you trade there	Quarterly updates, final declaration	All plans
MTD for VAT	Not needed for the Hong Kong company; local rules apply if you trade there	Files VAT returns	Any plan with VAT
Payroll	Handled by OCTIS accountants	Not published	From Grow, 1 person
Multi-currency	International multi-currency business account via licensed partners	Not published	Comprehensive and Ultimate
Company accounts and tax add-on	Audited statements, profits tax return and annual return, coordinated by OCTIS	Not published	£120 per year

If you have staff, premises or local sales in this country, its own registration and tax rules still apply. OCTIS can help you arrange them.

Data sources & disclaimer: Comparison data was compiled from publicly available sources — including the competitors' own published pricing and feature pages — captured on 9 November 2026. Figures reflect the typical or advertised pricing at that time and may have changed since; plans, inclusions and prices vary by provider, region and promotion. OCTIS is independent and not affiliated with the named companies; all trademarks belong to their respective owners. This comparison is provided in good faith for general information only and is not professional, legal or financial advice — please verify current details with each provider before deciding.

Which one fits you

OCTIS · Hong Kong company + OCTIS global plan
Choose OCTIS if your company is not a UK company, or you sell in several countries and want accounts, banking and CRM in one place.
FreeAgent
Choose FreeAgent if you are a sole trader, landlord or small company with simple books, or you bank with NatWest, RBS, Ulster Bank or Mettle and want it free.
Xero
Choose Xero if you need payroll for a first hire, multi-currency, many accountant connections, or the larger 90% introductory discount.

What the table does not show

Making Tax Digital for Income Tax: who is in and when

GOV.UK says you must use Making Tax Digital for Income Tax from 6 April 2026 if your self-employment and property income is over £50,000, measured before expenses. A GOV.UK policy paper of 24 March 2026 sets the next steps: over £30,000 from April 2027 and over £20,000 from April 2028. You send quarterly updates, then a final declaration. HMRC will not apply late quarterly update points in 2026 to 2027. The pages cover sole traders and landlords, and do not mention limited companies.

MTD for VAT is already the rule

GOV.UK says all VAT-registered businesses should be signed up for Making Tax Digital for VAT. Your software must keep records and send returns to HMRC. FreeAgent files MTD-compatible VAT returns. Xero says any plan that supports VAT works with MTD. If you are VAT-registered and also over the income threshold, you need software that does both.

The free FreeAgent offer

FreeAgent is free for as long as you keep a business current account with NatWest, Royal Bank of Scotland or Ulster Bank. Mettle account holders qualify with at least one transaction a month. Optional add-ons such as Smart Capture Unlimited (£5 per month) and Amazon (£6 per month) still cost extra, excluding VAT. FreeAgent's own page compares itself with Xero at higher Xero plans, so check the plan you would actually buy.

Where OCTIS fits

OCTIS does not file UK tax or run UK software. If your Malaysian or Hong Kong company has a UK subsidiary or sells to UK customers, a UK-based accountant and one of these tools handle the UK side. OCTIS bookkeeping keeps the home company's books and can consolidate the subsidiary's statements. Moving your accounting and company secretary work to OCTIS can take 10–30% off your current bill.

See OCTIS pricing

Frequently asked questions

Is FreeAgent or Xero better for Making Tax Digital?

Both say they support Making Tax Digital for Income Tax and VAT. FreeAgent is HMRC recognised and fills quarterly updates automatically. Xero says all plans are MTD ready. Choose on price and features, not on MTD.

Is FreeAgent really free?

Yes with a NatWest, Royal Bank of Scotland or Ulster Bank business current account, for as long as you keep it. Mettle holders qualify with one transaction a month. Optional add-ons may cost extra.

Do I need Making Tax Digital for Income Tax in 2026?

Only if your self-employment and property income was over £50,000 on your earlier tax return, from 6 April 2026. The threshold falls to £30,000 in April 2027 and £20,000 in April 2028. You can sign up early.

Does Making Tax Digital for Income Tax apply to limited companies?

The GOV.UK pages describe sole traders and landlords only, and do not mention limited companies. Check HMRC or ask your accountant for your own case.

How much does Xero cost for a sole trader?

Xero's Ignite plan is £18 per month, excluding VAT, with 90% off for six months for new customers. Grow is £39, Comprehensive £55 and Ultimate £70. Payroll for one person starts at Grow.

Sources

Checked on the date above. Links open the provider's or regulator's own page.