FreeAgent

Overview

FreeAgent is an accounting service for small businesses, accountants and bookkeepers. It is best suited to UK firms that want invoicing, bookkeeping and tax workflows in one place. Its broad toolkit is a strong fit for that job, but check the Smart Capture allowance and cash-basis exclusions before committing.

Key features

Accounts and invoicing

FreeAgent builds real-time accounts from bank statements, invoices and expenses, with Profit and Loss, Balance Sheet and Trial Balance reports. Open Banking feeds from most UK banks can reduce manual transaction entry. Recurring invoices, estimates that convert into invoices, late-payment reminders and payments through Stripe or PayPal cover much of the routine billing cycle.

Smart Capture is capped at 10 receipts and bills a month as standard. That may be enough for a low-volume operation, but businesses handling more paperwork need the £5 per month Unlimited add-on; its price excludes 20% VAT.

Tax, payroll and integrations

FreeAgent can prepare MTD-compatible VAT returns and file them directly with HMRC. It also supports Self Assessment and end-of-year filing for relevant business types. Payroll calculates PAYE and National Insurance and can submit Real Time Information to HMRC. The important caveat is that cash-basis accounting excludes both Stock and Payroll, so it is a poor fit for a business that needs either feature while using that accounting basis.

FreeAgent supports partner integrations and connects to HMRC for MTD VAT, but its own support for third-party integrations is limited to general guidance: those integrations are developed and supported externally. The service encrypts data in transit with HTTPS and TLS 1.2 and stored data with 256-bit AES; its data centres hold ISO 27001, 27017 and 27018 certifications, and FreeAgent states it is Cyber Essentials Plus certified.

Mobile apps

The iOS and Android apps handle expense recording, time tracking, invoice management and bank transaction reconciliation. That makes the product useful to owners who need to keep routine records moving away from a desk, rather than reserving all administration for the web.

Pricing

FreeAgent uses a freemium model, with a 30-day trial and plans aimed at different business types. The core monthly prices are £10 per month for Sole trader, £19 per month for Partnership or LLP, and £33 per month for Limited company. These give buyers a clear route from solo operation to a limited company, though the prices alone do not spell out feature differences between the business-type plans.

A £0 Free plan is also offered. Another £0 option is the Bank-account-funded account, which remains free only while eligible conditions are met: the user must retain a NatWest, Royal Bank of Scotland or Ulster Bank business current account, or keep a Mettle account with at least one transaction per month. Optional add-ons may be chargeable, so this is not an unconditional free tier.

Separate promotional prices are shown for monthly and annual subscriptions, excluding 20% VAT. Landlord costs £5 per month for six months, then £10 per month, or £50 for the first year, then £100 per year. Sole trader is £9.50 per month for six months, then £19 per month, or £95 for the first year, then £190 per year. Partnership or LLP is £13.50 per month for six months, then £27 per month. Limited company is £16.50 per month for six months, then £33 per month. Optional add-ons may cost extra on these plans. The lower introductory rates are temporary, so budget for the regular price after the stated period.

The Smart Capture Unlimited add-on costs £5 per month, billed monthly, excluding 20% VAT. It is the relevant extra for businesses that regularly exceed the standard 10-receipt-and-bill monthly allowance. UK-based support accountants can be contacted online or by phone.

Platforms

FreeAgent is available on the web, iOS and Android. Mobile apps support expenses, time tracking, invoices and bank reconciliation.

Who it's for

FreeAgent suits small UK businesses that want accounts, invoicing, expenses and HMRC-related work in a single service, as well as accountants and bookkeepers serving those businesses. It is less suitable for users who depend on cash-basis accounting alongside Stock or Payroll, or who need more than 10 Smart Capture items monthly but do not want an added charge.

Pros and cons

Pros

• Connected accounting and billing: bank feeds, invoices, expenses and core financial reports are brought into one workflow.
• UK tax and payroll support: VAT filing to HMRC, relevant Self Assessment and end-of-year filing, and RTI payroll submission reduce separate administrative steps.
• Practical mobile coverage: the apps cover reconciliation as well as time, invoices and expenses.
• Conditional free routes: a free plan and bank-account-funded access give eligible users ways to avoid a standard subscription price.

Cons

• Smart Capture has a modest standard cap: only 10 receipts and bills per month are included before the paid Unlimited add-on is needed.
• Cash-basis users lose key options: Stock and Payroll are excluded under that accounting choice.
• Introductory pricing rises: promotional subscription rates revert to higher regular prices after six months or one year, depending on term.
• Third-party integration support is external: FreeAgent does not provide detailed support for integrations built by other providers.

Alternatives

Clear Books is worth considering if a sole trader wants a forever-free, MTD-ready bookkeeping plan with no transaction limits. Zoho Books may suit a solopreneur or micro business that can stay below its $50K annual revenue threshold and work within a free plan limited to one user and one account. Wave is another free option for users who want unlimited estimates, invoices, bills and bookkeeping records, with online payments available at a transaction fee.

BUSY, Odoo Accounting, Zoho Inventory, FreshBooks and Patriot Accounting are also alternatives to compare.

Readers exploring categories can also browse Bookkeeping Software, Freelance Invoicing Software, Gym Accounting Software, SaaS Accounting Software and Salon Accounting Software.

Verdict

Choose FreeAgent if you run a small UK business and want accounting, invoicing and HMRC workflows under one roof, with mobile tools for everyday admin. Its strongest reason to buy is that breadth; look elsewhere if cash-basis accounting must include Stock or Payroll, or if your receipt volume makes the standard Smart Capture cap uneconomical.