What FreeAgent Is and Who Uses It
FreeAgent is a UK-based cloud accounting software developed specifically for freelancers, contractors, and small businesses. It was acquired by NatWest Group in 2018 and is now bundled free with NatWest Business Banking, RBS Business Banking, and Mettle accounts — which has made it the de facto accounting software for a large share of UK self-employed people and micro-businesses.
FreeAgent's core strengths are its simplicity and its focus on the compliance tasks that matter most to sole traders and simple limited companies:
- Bank feed with automatic transaction import from NatWest, RBS, Mettle, and most major UK banks via open banking
- Invoice creation and management with automatic payment matching
- Expense categorisation with HMRC-aligned category codes
- VAT return preparation and MTD-compliant submission direct to HMRC
- Self Assessment tax return preparation and filing (SA100, SA103F)
- Simple payroll for directors and employees (RTI-compliant)
- Corporation Tax return preparation (CT600) for limited companies
- A real-time tax timeline showing upcoming payment deadlines
FreeAgent is particularly well-suited to sole traders and single-director limited companies with straightforward finances — contractors billing through a personal service company, consultants, freelancers, and tradespeople. For businesses with more complex needs (multi-currency, departmental reporting, high transaction volumes, or 10+ employees), Xero or QuickBooks Online typically offers more capability.
How FreeAgent Accountant Access Works
FreeAgent has a built-in mechanism for giving an accountant or bookkeeper access to your account. The process is straightforward:
- You invite the Indian CA team via Settings → Your Accountant in FreeAgent. You enter the accountant's email address and send the invitation.
- The Indian CA team accepts the invitation and gains accountant-level access to your FreeAgent account.
- From this point, the Indian CA team can view and edit all transactions, bank feeds, invoices, expenses, VAT returns, payroll, and reports — exactly the same access a UK-based accountant would have.
- You retain owner-level access and can see everything the Indian CA team does in the audit log.
FreeAgent accountant access is remote by design — there is no local software to install and no VPN required. The Indian CA team logs in via a web browser or the FreeAgent mobile app. This makes FreeAgent particularly straightforward to outsource compared to desktop software like Sage 50, which requires a more complex remote access setup.
What the Indian CA Team Handles in FreeAgent
The scope of work for a typical FreeAgent client is the full monthly bookkeeping cycle, plus the annual compliance filings:
| Task | Frequency | What the Indian CA Does in FreeAgent |
|---|---|---|
| Bank reconciliation | Monthly | Reviews and categorises all bank transactions imported via the feed. Matches payments to outstanding invoices. Investigates and resolves unmatched items. Confirms reconciled balance matches bank statement. |
| Invoice and sales recording | Ongoing | Ensures all raised invoices are recorded and matched to payments received. Flags any invoices outstanding beyond payment terms for the client's attention. |
| Expense categorisation | Monthly | Reviews expenses entered by the client or imported via bank feed, applies correct HMRC expense categories, flags any items requiring a receipt or further information. |
| VAT return preparation | Quarterly (or monthly) | Reviews the VAT figures in FreeAgent, checks for any miscoded transactions, prepares the return, and submits directly to HMRC via the MTD API within FreeAgent. |
| Payroll (if applicable) | Monthly | Runs payroll within FreeAgent, processes director salary and any employee pay, submits RTI Full Payment Submission to HMRC, journals the payroll entries. |
| Self Assessment (sole traders) | Annual | Reviews the Self Assessment figures generated by FreeAgent, makes any necessary adjustments, prepares the SA100 and SA103F, discusses with the client, and submits to HMRC via FreeAgent's direct filing. |
| Year-end accounts (limited companies) | Annual | Prepares statutory accounts from the FreeAgent records, files at Companies House, prepares CT600 and submits to HMRC. Note: FreeAgent generates draft accounts — the Indian CA reviews, adjusts for accruals and year-end items, and handles the filing. |
FreeAgent vs Xero vs QuickBooks — Which Is Right for Your Business
Many UK businesses using FreeAgent wonder whether they should switch to Xero or QuickBooks as they grow. The Indian CA team works in all three — so this is not a switching barrier. Here is how the three platforms compare for the businesses that typically outsource to India:
| Feature | FreeAgent | Xero | QuickBooks Online |
|---|---|---|---|
| Best for | Sole traders, freelancers, single-director limited companies | Small and medium businesses, businesses with employees or stock | Small businesses, businesses wanting strong reporting and US-linked operations |
| UK MTD VAT | Yes | Yes | Yes |
| Self Assessment filing | Yes — built in | Via third-party integrations only | Via third-party integrations only |
| Corporation Tax CT600 | Yes — built in | Via third-party integrations only | Via third-party integrations only |
| Multi-currency | Limited (invoice currency only) | Yes — full multi-currency with revaluation | Yes — multi-currency |
| Payroll (UK) | Basic — suited to 1–5 employees | Xero Payroll — up to 10 employees included; more at cost | QuickBooks Payroll — separate add-on |
| Stock/inventory | No | Yes — basic stock tracking | Yes — including purchase orders |
| Departmental reporting | Limited | Yes — tracking categories | Yes — classes and locations |
| NatWest/RBS direct feed | Yes — automatic | Via open banking | Via open banking |
| Price (own subscription) | £19–£29/month + VAT (free with NatWest/RBS/Mettle) | £15–£55/month + VAT | £12–£65/month + VAT |
The recommendation is straightforward: if FreeAgent meets your needs and you bank with NatWest or RBS (so it is free), stay in FreeAgent. If you have outgrown it — more employees, multi-currency, complex project reporting — migrating to Xero is the typical next step, and the Indian CA team handles that migration. Our outsourced bookkeeping service covers all three platforms.
Self Assessment for FreeAgent Users — What the Indian CA Handles
For sole traders and freelancers, Self Assessment is typically the most important annual tax filing. FreeAgent's Self Assessment module is one of its strongest features — it generates the tax return directly from the bookkeeping records, eliminating the need to manually re-enter income and expense figures. The Indian CA team's role in Self Assessment for a FreeAgent user:
- Review the bookkeeping year: Before preparing the Self Assessment, the Indian CA team confirms that all income and expenses are correctly categorised for the tax year (6 April to 5 April). Any items that affect the tax return but are not in FreeAgent — pension contributions, Gift Aid donations, rental income, savings interest — are gathered separately.
- Apply any adjustments: FreeAgent generates a draft Self Assessment, but some adjustments need to be applied manually — capital allowances for equipment purchased in the year, use-of-home-as-office claims, mileage claims, and any prior-year adjustments. The Indian CA team handles these.
- Calculate the tax liability: The Indian CA team reviews the computed tax liability — Income Tax, Class 2 and Class 4 National Insurance — and discusses the figures with the client before submission. Payments on account (advance tax payments due in January and July) are also explained.
- Submit to HMRC: The return is submitted directly from FreeAgent to HMRC. HMRC issues a submission acknowledgement within minutes, which the Indian CA team sends to the client as confirmation.
Cost — Indian CA Firm vs UK Accountant for FreeAgent Users
FreeAgent users are often sole traders or single-director limited companies who currently use a local UK accountant for Self Assessment or year-end accounts only. The cost comparison for this typical profile:
| Service | UK High Street Accountant | Indian CA Firm |
|---|---|---|
| Monthly bookkeeping review (FreeAgent) | £100–£200/month | £50–£100/month |
| Quarterly VAT return (MTD) | £75–£150 per return | Included in monthly fee or £30–£60 per return |
| Self Assessment (sole trader, simple) | £250–£600 | £100–£200 |
| Self Assessment (complex — multiple sources, capital gains) | £600–£1,500 | £200–£500 |
| Year-end accounts + CT600 (limited company) | £1,000–£2,500 | £300–£600 |
| Total annual cost (sole trader, VAT-registered, monthly bookkeeping) | £1,800–£3,600 | £750–£1,400 |
For FreeAgent users who are currently doing their own bookkeeping and using a UK accountant only for Self Assessment, switching both tasks to an Indian CA firm typically saves £500–£1,500 per year while also improving the quality and timeliness of monthly records. Our UK services page has more detail on what we cover for UK sole traders and limited companies, and our cost comparison guide gives a broader picture of pricing across different business sizes. If you are considering switching from your current accountant, our switching guide covers the handover process step by step.
Written by Sharma Jyoti, CA (ICAI) — Founder, Sharma Jyoti and Co. We are an ICAI-registered Chartered Accountant firm providing outsourced bookkeeping and accounting services to Australian, US, UK and Canadian businesses. Our team includes Xero Advisor Certified professionals (Certificate #17207818). Learn more about our firm →
Outsource QuickBooks Bookkeeping to India — UK Guide
Read → Switching GuideHow to Switch from Your UK Bookkeeper to an Indian CA Firm
Read → Sole TradersSole Trader Bookkeeping — Outsourcing to India from the UK
Read → PricingHow Much Does It Cost to Hire an Indian Bookkeeper from the UK?
Read →Frequently Asked Questions
Yes. An Indian CA firm can be added to your FreeAgent account as an accountant user and access your books remotely. The accountant user role gives read and write access to transactions, bank feeds, invoices, expenses, VAT returns, and reports. FreeAgent is cloud-based, so remote access from India works identically to access from the UK. The Indian CA team handles bank reconciliation, expense categorisation, VAT return preparation, and Self Assessment filing, all within FreeAgent.
Yes. FreeAgent is included free with NatWest Business Banking, RBS Business Banking, and Mettle (NatWest's app-based business account). The free access continues for as long as you hold the business account. If you close the account or switch banks, FreeAgent reverts to a paid subscription (currently £19/month + VAT for sole traders, £29/month + VAT for limited companies, after a 30-day free trial). This bank-bundled arrangement makes FreeAgent the default accounting software for a large number of UK sole traders and freelancers.
Yes. FreeAgent is HMRC-recognised Making Tax Digital (MTD) compatible software. VAT returns prepared in FreeAgent can be submitted directly to HMRC via the MTD API — the Indian CA team prepares and submits the return within FreeAgent without any manual re-entry of figures into the HMRC portal. FreeAgent also supports the MTD for Income Tax Self Assessment (MTD ITSA) pilot, which will become mandatory for sole traders and landlords with income over £50,000 from April 2026 and over £30,000 from April 2027.
FreeAgent works well for sole traders, freelancers, and simple limited companies. Its main limitations for growing businesses are: no multi-currency support beyond basic invoice currency conversion, limited stock and inventory tracking, no departmental or project-level profit and loss reporting (compared to Xero's tracking categories), limited payroll capability for businesses with more than a handful of employees, and a smaller ecosystem of third-party integrations compared to Xero or QuickBooks Online. Businesses that outgrow FreeAgent typically migrate to Xero, which the Indian CA team also supports.
Yes. FreeAgent includes a Self Assessment module that pulls income and expense figures from the bookkeeping records and generates the SA100 and supplementary pages (SA103F for self-employment, SA105 for property income). The Indian CA team reviews the figures, makes any necessary adjustments, and submits the return to HMRC directly from FreeAgent. For more complex Self Assessment returns — multiple income sources, capital gains, foreign income, or High Income Child Benefit Charge — the Indian CA team prepares the return and discusses it with you before submission.