FreeAgent vs Xero
A head-to-head comparison to help you pick the right tool
Last updated: April 30, 2026
FreeAgent
FreeAgent is a cloud accounting platform designed specifically for freelancers, contractors, and small businesses in the UK. It offers automatic bank feeds, invoicing, expense management, and self-assessment tax return preparation. FreeAgent is particularly popular with UK freelancers and contractors for its excellent handling of UK tax requirements including Self Assessment and VAT returns.
Xero
Xero is a cloud-based accounting platform popular with small businesses and accountants worldwide. It is known for its clean interface, strong bank reconciliation tools, and excellent integration ecosystem. Xero is particularly popular in Australia, New Zealand, and the UK, and is considered the main alternative to QuickBooks for cloud-based accounting.
Pros
- ✓Excellent UK tax compliance including Self Assessment and VAT returns
- ✓Designed specifically for freelancers and contractors
- ✓Clean and easy to use interface
- ✓Automatic bank feeds save significant time
Cons
- ✗Primarily suited for UK market — limited value for non-UK businesses
- ✗Less feature-rich than QuickBooks for complex business needs
- ✗Smaller integration ecosystem than larger competitors
- ✗Not suitable for larger businesses with complex accounting needs
Pros
- ✓Beautiful and intuitive interface — one of the cleanest in accounting software
- ✓Unlimited users on all plans — no per-seat pricing
- ✓Excellent bank reconciliation with smart matching
- ✓Strong ecosystem of 1000+ integrations
Cons
- ✗Payroll requires a separate add-on in most regions
- ✗Inventory management is basic compared to QuickBooks
- ✗Reporting is less comprehensive than QuickBooks on lower tiers
- ✗Customer support is primarily online with no phone support
FreeAgent vs Xero: Side by Side
| Factor | FreeAgent | Xero |
|---|---|---|
| User Rating | N/A | N/A |
| Category | Accounting Software | Accounting Software |
| Pricing Model | Paid | Paid |
| Starting Price | $12/mo | $15/mo |
| Best For | UK freelancers and contractors wanting simple accounting with strong Self Assessment and VAT tools | Small businesses and accountants wanting a clean, modern alternative to QuickBooks |
| Our Pick | — | — |
FreeAgent Features
- ✓Invoicing
- ✓expense management
- ✓bank feeds
- ✓time tracking
- ✓project management
- ✓self-assessment tax returns
- ✓VAT returns
- ✓payroll
- ✓financial reporting
- ✓mobile app
Xero Features
- ✓Bookkeeping
- ✓invoicing
- ✓bank reconciliation
- ✓expense claims
- ✓payroll
- ✓financial reporting
- ✓inventory
- ✓project tracking
- ✓integrations
- ✓mobile app
Pricing Comparison
Our Take
Choose FreeAgent if uk freelancers and contractors wanting simple accounting with strong self assessment and vat tools. Choose Xero if small businesses and accountants wanting a clean, modern alternative to quickbooks.
Best For
UK freelancers and contractors wanting simple accounting with strong Self Assessment and VAT tools
Best For
Small businesses and accountants wanting a clean, modern alternative to QuickBooks
How FreeAgent and Xero Are Similar
- •Both are Accounting Software platforms designed for business teams
- •Both offer web-based access with no software installation required
- •Both provide customer support and onboarding resources
- •Both integrate with popular third-party business tools
- •Both offer a trial or demo to evaluate before purchasing
Also Consider
If neither FreeAgent nor Xero is the right fit, Dext is worth evaluating.
Dext
Bookkeepers, accountants, and businesses with high receipt volumes wanting to eliminate manual data entry
From $15/mo
Frequently Asked Questions
What is the difference between FreeAgent and Xero?
FreeAgent is best for uk freelancers and contractors wanting simple accounting with strong self assessment and vat tools. Xero is best for small businesses and accountants wanting a clean, modern alternative to quickbooks.
Which is better, FreeAgent or Xero?
Choose FreeAgent if uk freelancers and contractors wanting simple accounting with strong self assessment and vat tools. Choose Xero if small businesses and accountants wanting a clean, modern alternative to quickbooks.
How much does FreeAgent cost?
FreeAgent starts at $12/mo. Pricing model: Paid.
How much does Xero cost?
Xero starts at $15/mo. Pricing model: Paid.
Who should use FreeAgent?
UK freelancers and contractors wanting simple accounting with strong Self Assessment and VAT tools
Who should use Xero?
Small businesses and accountants wanting a clean, modern alternative to QuickBooks