MTD Software Comparison 2026: Free vs Paid Options

There are dozens of MTD-compatible software options, but most sole traders and landlords only need the basics. Here's an honest comparison of what's available, what it costs, and what you actually need.

Two types of MTD software

Before comparing, understand the distinction:

• Full accounting software — replaces your existing records. You do everything inside the platform: invoicing, expenses, bank feeds, and MTD submissions. Examples: Xero, QuickBooks, FreeAgent.
• Bridging software — works alongside your existing records. You keep your spreadsheet and use the tool only to submit figures to HMRC. Examples: Flonancial, 123 Sheets.

If you already have a system that works (even if it's just a spreadsheet), bridging software is all you need.

Pricing comparison

Software	Type	Price	Best for
Flonancial	Bridging	Free	Spreadsheet users, sole traders, landlords
Xero	Full accounting	From £17/month	Businesses wanting full bookkeeping
QuickBooks	Full accounting	From £12/month	Similar to Xero, cheaper entry point
FreeAgent	Full accounting	From £14.50/month	Freelancers (free with some banks)
Sage	Full accounting	From £14/month	Established businesses with complex needs
Hammock	Full accounting	From £8/month	Landlords specifically
GoSimpleTax	Full accounting	From £50/year	Self Assessment + MTD combined

What do you actually need?

HMRC requires two things: digital records and quarterly digital submissions. If your spreadsheet is your digital record, you only need software for the submission part.

Paying £15/month for Xero to submit four numbers per quarter is like hiring a removal van to deliver a letter. It works, but it's overkill.

When full accounting software makes sense

Consider Xero, QuickBooks, or FreeAgent if:

• You send invoices and want to track who's paid
• You want automatic bank feed categorisation
• You have employees or do payroll
• Your accountant prefers a specific platform
• You don't keep a spreadsheet and need something from scratch

When bridging software makes sense

Use bridging software like Flonancial if:

• You already track everything in a spreadsheet
• You don't want to learn new software
• Your finances are straightforward
• You want to keep costs at zero
• You want to keep control of your own records

The bottom line

If you already keep decent records in a spreadsheet, you don't need to pay for MTD. Free bridging software does the job. If you want a full accounting platform for other reasons, that's a separate decision — don't let MTD force you into one.