FreeAgent Online Accountants
FreeAgent Accounting Software & FreeAgent Accountants
A practical UK guide to FreeAgent accounting software and how working with a FreeAgent accountant can help you manage bookkeeping, accounts, tax and Making Tax Digital.
FreeAgent is cloud accounting software designed primarily for UK small businesses, sole traders, freelancers, landlords and limited companies. It brings everyday bookkeeping, bank transactions, invoicing, expenses, VAT, tax calculations and financial reporting together in one online system.
Working with FreeAgent accountants can add another layer of support. Your accountant can access the same accounting records, review bookkeeping, correct errors, prepare accounts and tax returns and help you use the information in FreeAgent to make better financial decisions.
For many owner-managed businesses, this combination of easy-to-use accounting software and professional accounting support can provide a practical alternative to spreadsheets, paper records and sending bookkeeping information to an accountant once a year.
What is FreeAgent Accounting Software?
FreeAgent is online accounting and bookkeeping software that allows a business owner and their accountant to work from the same financial records. Because the software is cloud based, there is no traditional accounting program to install on a single office computer.
Transactions can be imported through bank feeds, sales invoices can be raised inside the software, expenses can be recorded and financial reports update as the underlying bookkeeping changes.
For UK businesses, one of FreeAgent's main attractions is its focus on UK accounting and tax. Depending on the business type and circumstances, FreeAgent can assist with areas including VAT, Self Assessment, Corporation Tax information and Making Tax Digital.
Bookkeeping
Record business income and expenditure and explain imported bank transactions so your accounting records remain up to date.
Invoicing
Create invoices, monitor amounts outstanding and use invoice reminders to help manage customer payments.
Financial Reports
View accounting information such as profit and loss and balance sheet reports without waiting until the end of the year.
VAT
Maintain digital VAT records and prepare VAT information from the transactions recorded within your FreeAgent account.
Bank Feeds
Connect supported bank accounts so transactions can flow into FreeAgent rather than being entered manually.
Accountant Access
Give your accountant access to review your records, correct bookkeeping and use the data when preparing accounts and tax work.
What Can You Do With FreeAgent?
| FreeAgent feature | What it does | Why it can matter |
|---|---|---|
| Bank feeds | Imports transactions from supported connected bank accounts. | Reduces manual transaction entry and makes regular bookkeeping easier. |
| Invoicing | Creates and sends customer invoices and tracks payment status. | Helps businesses monitor outstanding amounts and cash collection. |
| Expenses | Records business costs and supporting information. | Helps maintain more complete records for accounts and tax. |
| Bank reconciliation | Allows transactions to be explained and matched to accounting entries. | Helps ensure the bookkeeping agrees with actual bank activity. |
| VAT | Uses bookkeeping data to help calculate and prepare VAT returns. | Reduces duplication between bookkeeping and VAT compliance. |
| Tax information | Uses accounting data to provide relevant tax calculations and information. | Provides greater visibility over potential tax liabilities. |
| Accounting reports | Produces reports based on the transactions entered. | Allows owners and accountants to review performance throughout the year. |
| Accountant collaboration | Allows accountant access to the client's FreeAgent records. | Both parties can work from the same underlying accounting data. |
What Do FreeAgent Accountants Do?
A FreeAgent accountant does more than simply log in to your bookkeeping software. The software records and organises financial information, while an accountant can review what that information means for your accounts, tax position and statutory obligations.
FreeAgent Software vs a FreeAgent Accountant
Accounting software and an accountant perform different roles. FreeAgent can automate and organise a significant amount of financial administration, but the accuracy of the resulting accounts still depends on how transactions are recorded and on any accounting or tax adjustments that are required.
FreeAgent Accounting Software
- Records day-to-day bookkeeping
- Imports bank transactions
- Creates sales invoices
- Records expenses
- Produces accounting reports
- Supports relevant digital tax processes
- Provides visibility over business finances
FreeAgent Accountant
- Reviews whether records are correctly maintained
- Corrects bookkeeping and accounting errors
- Makes year-end accounting adjustments
- Prepares statutory accounts where required
- Deals with relevant tax returns and calculations
- Provides tax and accounting advice
- Helps interpret the figures rather than simply recording them
The key distinction: FreeAgent is the accounting system. Your accountant provides professional review, judgement, compliance support and advice.
Using FreeAgent With an Online Accountant
Cloud accounting is particularly well suited to online accountancy because the business owner and accountant do not need to be in the same location. Both can work from the same accounting records.
Connect
Set up FreeAgent and connect the appropriate business bank accounts and accounting information.
Record
Record invoices, expenses and other transactions and regularly explain imported bank entries.
Review
Your accountant can access the records remotely and review the bookkeeping and accounting information.
File & Advise
The records can then form the starting point for accounts, tax compliance and ongoing accounting advice.
This removes much of the traditional process of delivering bookkeeping records to an accountant after the financial year has already finished.
FreeAgent and Making Tax Digital for Income Tax
Making Tax Digital for Income Tax has made compatible digital accounting software increasingly important for affected sole traders and landlords.
The first mandatory phase began on 6 April 2026 for people with qualifying self-employment and property income above £50,000, based on the relevant earlier tax return. Further phases are scheduled to extend the regime to more taxpayers.
FreeAgent supports MTD for Income Tax functionality, allowing relevant digital records and submissions to be managed within the accounting system.
Thresholds and MTD rules can change. Your obligations depend on your individual circumstances and the legislation applying at the relevant time.
Who is FreeAgent Suitable For?
FreeAgent is particularly focused on smaller UK businesses. Whether it is appropriate for you depends on the size and complexity of the business, the features you need and how you prefer to manage your bookkeeping.
Sole Traders
FreeAgent can bring invoicing, expenses, banking, bookkeeping and relevant Income Tax information into one system.
Limited Companies
Owner-managed companies can use FreeAgent for day-to-day bookkeeping while giving their accountant access for year-end accounts and Corporation Tax work.
Freelancers
Businesses with relatively straightforward income and expenditure may benefit from having invoicing and bookkeeping in the same platform.
Contractors
FreeAgent has traditionally been popular with contractors who want straightforward bookkeeping, invoicing and visibility over business finances.
Landlords
Property income is particularly relevant as Making Tax Digital for Income Tax expands to more qualifying landlords.
Small Businesses
Businesses wanting a cloud-based accounting system that can be shared with their accountant may find FreeAgent a practical option.
Advantages and Potential Limitations of FreeAgent
| Potential advantages | Points to consider |
|---|---|
| Designed with UK small businesses in mind. | Very complex businesses may require functionality outside FreeAgent's core small-business focus. |
| Combines bookkeeping, invoicing and accounting information. | Automation does not remove the need to check that transactions have been treated correctly. |
| Bank feeds can reduce manual data entry. | Imported transactions still need appropriate accounting treatment. |
| Accountant and client can work from the same records. | Professional advice may still be needed for tax and accounting decisions. |
| Supports relevant UK digital tax requirements. | Your exact filing obligations depend on business type and individual circumstances. |
| Cloud access allows records to be maintained from different locations. | Businesses should still maintain appropriate controls over user access and records. |
Can You Get FreeAgent for Free?
Some UK business banking customers may be able to obtain a FreeAgent subscription without paying FreeAgent's normal subscription charge.
FreeAgent currently provides eligible customers of certain NatWest Group business banking services, including NatWest, Royal Bank of Scotland, Ulster Bank and Mettle, with access subject to the applicable eligibility conditions.
If you already have one of these business accounts, it is therefore worth checking whether FreeAgent is included before purchasing a separate accounting software subscription.
Banking and software offers can change and optional FreeAgent add-ons may carry separate charges. Always check the current terms applying to your account.
What Should You Look for in a FreeAgent Accountant?
If you already use FreeAgent, choosing an accountant who understands the platform can reduce unnecessary duplication and make it easier for your accountant to work directly with your existing records.
They should be comfortable reviewing and working with FreeAgent records.
Check the professional standing and experience of the accountant providing your service.
The accountant should understand the tax obligations relevant to your business structure.
Establish whether statutory accounts and tax returns are included in the service you are purchasing.
Understand what is included and whether additional work creates extra charges.
Good accounting support should help you understand the numbers, not simply produce them.
Using FreeAgent as Part of Your Accounting System
FreeAgent can take care of much of the bookkeeping process, while professional accounting support can deal with the wider compliance and tax requirements surrounding your business.
If you operate through a company, see our company accounts filing service. Sole traders can read about our self-employed accounts service, while businesses comparing professional fees can review our accountants fees guide.
You can also compare the wider benefits of working with online accountants rather than relying solely on accounting software.
FreeAgent Accounting Software FAQs
What is FreeAgent accounting software?
FreeAgent is cloud-based accounting software aimed primarily at UK small businesses. It can be used for bookkeeping, invoicing, expenses, bank transactions, accounting reports and relevant UK tax and digital filing processes.
What is a FreeAgent accountant?
A FreeAgent accountant is an accountant who works with accounting records held in FreeAgent. They may review bookkeeping, make accounting adjustments, prepare accounts and tax returns and provide advice based on the financial information recorded in the system.
Is FreeAgent suitable for a limited company?
FreeAgent can be suitable for many small owner-managed limited companies. It can be used for bookkeeping, invoices, expenses, bank transactions and financial reporting, while an accountant can use the records when preparing statutory accounts and Corporation Tax work.
Is FreeAgent suitable for sole traders?
Yes. FreeAgent is designed to support sole traders as well as limited companies and other small businesses. Its Income Tax and Making Tax Digital functionality may be particularly useful to qualifying sole traders.
Does FreeAgent work with Making Tax Digital?
FreeAgent supports Making Tax Digital functionality, including MTD for VAT and MTD for Income Tax. The exact requirements that apply to you depend on your tax position and qualifying income.
Can my accountant access my FreeAgent account?
Yes. FreeAgent is designed to allow collaboration between businesses and accountants, enabling an accountant with appropriate access to review the accounting records without needing the business owner to send separate copies of the bookkeeping data.
Can FreeAgent replace an accountant?
FreeAgent can automate and simplify many bookkeeping and accounting tasks, but software and professional accounting advice perform different roles. An accountant can review accounting treatments, make adjustments, prepare statutory information and advise on tax and business decisions.
Can I get FreeAgent free with a business bank account?
Eligible customers of certain NatWest Group business banking services may currently receive access to FreeAgent subject to the relevant terms. Check the current conditions applying to your particular bank account.
Is FreeAgent good for landlords?
FreeAgent can be relevant to landlords who need to maintain digital records, particularly as Making Tax Digital for Income Tax is phased in. Suitability depends on the nature and complexity of the property business.
Do I need an accountant if I use FreeAgent?
There is no universal requirement to appoint an accountant simply because you use FreeAgent. However, many businesses choose professional support for statutory accounts, tax returns, accounting adjustments, tax advice and checking that their bookkeeping records are accurate.
Looking for a FreeAgent Accountant?
If you already use FreeAgent, you don't need to start your bookkeeping again. Our online accountants can work with your existing accounting records and help with your year-end accounts, tax returns and ongoing accounting requirements.