Free Making Tax Digital software does exist in the UK — but it’s not one-size-fits-all.
Some providers offer genuinely free plans for non-VAT sole traders, while others are free only if you meet specific criteria (such as using a partner bank). The table below highlights which MTD-compatible tools are truly free, who they’re suitable for, and the key limitations to be aware of.
Free Making Tax Digital (MTD) software in the UK
The tools below offer either a free plan or free access under specific conditions. Always check eligibility, VAT status, and feature limits before relying on free software for compliance.
| Software | Is it free? | Best for | MTD support | Key limitations | Link |
|---|---|---|---|---|---|
|
Sage Accounting – Individual Free
Official free plan from a major UK accounting provider
|
Yes (free plan) | Non-VAT registered sole traders | MTD-ready (Income Tax focus) | No VAT returns; designed for basic self-assessment | Visit site |
|
Clear Books – Sole Trader Free
UK-built software with HMRC-aligned workflows
|
Yes (free plan) | Sole traders with simple bookkeeping needs | MTD VAT & Income Tax support | Limited features; paid plans needed as complexity grows | Visit site |
|
Zoho Books – Free Plan
Modern accounting software with a free UK tier
|
Yes (free plan) | Small businesses under revenue threshold | MTD VAT support | Only free below turnover limits; user caps apply | Visit site |
|
FreeAgent
Designed for freelancers and contractors
|
Free via bank | Freelancers banking with NatWest, RBS, Ulster or Mettle | Full MTD support | Not free unless you use an eligible bank account | Visit site |
|
QuickFile
Popular low-cost UK bookkeeping platform
|
Yes (free tier) | VAT-registered micro-businesses | MTD VAT filing | Advanced features require paid add-ons | Visit site |
Free MTD Software in the UK (2026 Guide)
Making Tax Digital (MTD) has changed how UK businesses and sole traders keep records and submit tax information to HMRC. While many accounting platforms charge monthly fees, free MTD software does exist in the UK — but it’s often misunderstood.
This guide explains which MTD software is genuinely free, who it’s suitable for, and the limitations you need to be aware of before relying on a free solution.
What does “free MTD software” actually mean?
When people search for free MTD software UK, they’re usually looking for one of the following:
- Software that costs nothing to use long-term (not just a free trial)
- A way to stay HMRC-compliant without monthly fees
- A solution suitable for sole traders, freelancers, or very small businesses
However, “free” can mean different things depending on the provider.
Some tools are:
- Free only for non-VAT registered businesses
- Free below certain turnover thresholds
- Free only if you bank with a specific provider
- Free for record-keeping, but limited for VAT or MTD Income Tax
That’s why it’s important to understand who each free option is designed for.
Is there official free MTD software from HMRC?
No.
HMRC does not provide its own free MTD software.
Instead, HMRC maintains a list of recognised MTD-compatible software providers, which includes both paid and free options. Any free software you use must still be on HMRC’s recognised list to submit returns digitally.
Who is free MTD software best suited for?
Free MTD software is most realistic for:
- Non-VAT registered sole traders
- Side businesses and freelancers
- Micro-businesses with simple finances
- People preparing for MTD for Income Tax who don’t yet need advanced features
If you are:
- VAT-registered with complex returns
- Running payroll
- Managing multiple users or properties
…you’ll usually outgrow free plans fairly quickly.
Free MTD Software in the UK (Verified Options)
Below are UK-relevant tools that offer genuinely free MTD-compatible access, either through a free plan or free eligibility route.
Always check eligibility before signing up — free does not always mean “free for everyone”.
1. Sage Accounting – Individual Free
Sage offers an “Individual Free” plan designed specifically for non-VAT registered sole traders.
Key points:
- Free to use (no billing)
- Focused on income, expenses, and self-assessment
- Positioned as MTD-ready for sole traders
Limitations:
- Not suitable for VAT-registered businesses
- Basic functionality only
Best for:
Sole traders who want a recognised UK brand and simple compliance.
2. Clear Books – Sole Trader Free
Clear Books provides a free sole trader plan built around UK tax workflows.
Key points:
- UK-developed software
- Supports MTD-related record keeping
- Clear upgrade path as businesses grow
Limitations:
- Feature-limited compared to paid plans
- Best suited to simple bookkeeping needs
Best for:
UK sole traders who want HMRC-aligned software with local support.
3. Zoho Books – Free Plan (UK)
Zoho Books offers a free forever plan in the UK, subject to eligibility.
Key points:
- Modern cloud accounting platform
- Free below a defined turnover threshold
- MTD VAT support available on the UK edition
Limitations:
- Only free under revenue limits
- User and feature caps apply
Best for:
Small businesses or freelancers who want a modern interface and may upgrade later.
4. FreeAgent – Free via partner banks
FreeAgent does not offer a public free plan, but many UK businesses can use it completely free through specific banks.
Free if you bank with:
- NatWest
- Royal Bank of Scotland
- Ulster Bank
- Mettle (subject to account activity)
Key points:
- Full MTD support
- Designed for freelancers and contractors
- Strong tax timeline features
Limitations:
- Only free if you use an eligible bank
- Not a free-for-everyone product
Best for:
Freelancers and contractors already using supported UK banks.
5. QuickFile – Free tier with MTD VAT support
QuickFile is a UK bookkeeping platform offering a free tier, including MTD VAT submission.
Key points:
- Free tier available
- Supports MTD VAT filing
- Popular with micro-businesses
Limitations:
- Advanced features require paid add-ons
- Interface is more functional than modern
Best for:
VAT-registered micro-businesses wanting a low-cost or free MTD VAT option.
Summary: How many free MTD software options are there?
In practical terms:
- 3–4 providers offer true free plans (Sage, Clear Books, Zoho Books, QuickFile)
- 1 provider is free via eligibility (FreeAgent via partner banks)
Most large platforms (Xero, QuickBooks, FreshBooks, IRIS, Odoo) do not offer permanent free MTD software — only free trials.
Free vs paid MTD software: what’s the trade-off?
| Free MTD software | Paid MTD software |
|---|---|
| £0 ongoing cost | Monthly subscription |
| Basic features | Advanced reporting & automation |
| Limited support | Priority support |
| Suitable for micro-businesses | Better for VAT, payroll & growth |
Free MTD software is ideal for getting compliant cheaply, but many businesses upgrade once their needs become more complex.
Final thoughts
If you’re searching for free MTD software in the UK, the good news is that real options do exist — especially for sole traders and very small businesses.
The key is choosing software that:
- Is recognised by HMRC
- Matches your VAT status
- Won’t force an unexpected upgrade at the wrong time
For businesses planning to grow, free MTD software is often best seen as a starting point, not a permanent solution.