Free MTD Software UK: What Is Available and What to Watch Out For

Several HMRC-recognised software providers offer free tiers for Making Tax Digital for Income Tax (MTD ITSA). Not all free options are equally capable, and some have restrictions that mean you may need a paid plan for full compliance. This article explains what is available, what each option actually includes, and what to check before you commit.

Why "Free" Needs Scrutiny

HMRC requires your MTD ITSA software to do three things: keep digital records, submit quarterly updates, and submit your final declaration (the year-end tax return). A product that only handles the first two is not sufficient on its own for full compliance.

Some providers offer digital record-keeping and quarterly updates for free, but charge for the final declaration submission. Others are fully free but limit the number of transactions per year. Before choosing any free software, confirm it supports all three requirements for your income type.

GOV.UK's software finder tool lets you filter for products that meet your specific needs, including income type and accounting period. You can also review the full list of HMRC-recognised options in our MTD software guide.

Clear Books Free

Clear Books offers a free plan specifically for sole traders and landlords. It is HMRC-recognised for MTD ITSA and covers digital record-keeping, quarterly updates, and end-of-year tax return submission at no charge.

The free plan supports self-employment income, UK property income, and the combination of both. Clear Books notes on its website that the free tier has no revenue thresholds or transaction volume qualifiers for access.

The software is built and maintained by a UK company and has been operating in the accountancy software market since 2008. It is accredited by the Institute of Certified Bookkeepers and registered with the Financial Conduct Authority (registration number 843585).

What to check: Clear Books confirmed that the end-of-year tax return function was listed as "coming soon" on their free MTD page as of early 2026. Verify the current status directly with the provider before signing up if you want to use it for the 2026/27 tax year.

SumUp

SumUp offers free MTD-compatible software aimed at sole traders and self-employed people. The product is described by SumUp as designed for non-accountants, with a simpler interface than full accounting packages.

SumUp is HMRC-recognised and designed to handle quarterly updates and digital record-keeping under MTD ITSA. It suits people who want a minimal-overhead tool without the full feature set of packages like Xero or QuickBooks.

SumUp's MTD ITSA offering was developed ahead of the April 2026 deadline. Check directly with SumUp that it supports your specific income type (self-employment, UK property, or both) before registering.

QuickFile

QuickFile has been HMRC-recognised for MTD since the VAT regime and supports MTD ITSA from April 2026. The base accounting software is free for accounts with up to 1,000 ledger entries per year (covering most sole traders and smaller landlords). However, the MTD ITSA quarterly submissions and final declaration require the Power User subscription, which is an additional annual paid fee.

If you are an existing QuickFile user and your account falls into the free tier by size, you will still need to purchase the Power User subscription to file under MTD ITSA. QuickFile's community documentation confirms this.

QuickFile remains worth considering if you already use it for bookkeeping or VAT, since the upgrade adds MTD ITSA capability to a familiar interface.

What Free Software Usually Does Not Include

Even genuinely free MTD software tends to exclude certain features that paid tiers include:

• Bank feeds: Automatic import of bank transactions is typically a paid add-on or linked to having a business account with the same provider.
• Receipt scanning: Automatic capture from photos of receipts is usually a paid feature or limited to a small number per month.
• Multiple income sources: Some free tiers only cover one self-employment business or one property income stream. If you have both, or multiple businesses, check explicitly.
• Foreign property income: This is rarely included in free tiers and requires a more capable paid plan.
• Payroll: Not relevant for most sole traders and landlords, but absent from all free tiers.

Do Free Options Work for Landlords?

Yes, provided the software supports UK property income. Clear Books Free explicitly supports landlords with UK property income and the combination of property and self-employment income. SumUp's MTD product is described as suitable for sole traders and self-employed people; if you are a landlord without a separate trade, confirm property income is supported before signing up.

If you hold foreign property alongside UK property, or you have a more complex income picture, a free tier is unlikely to meet all your needs. A paid plan from a full-service provider is more appropriate.

Is Free Software Right for You?

Free MTD software is a reasonable starting point for sole traders and landlords with a straightforward income picture: one self-employment business or one UK rental property, no bank feed requirement, and basic bookkeeping needs.

If your situation is more complex (multiple businesses, foreign property, or you want bank feeds and receipt capture), the time cost of working around free-tier limitations may outweigh the saving on a modest paid plan. Our comparison of Xero vs QuickBooks for MTD covers two of the leading paid options, and our FreeAgent MTD review covers a product with a dedicated landlord plan.

For a broader look at your compliance obligations before choosing software, the MTD sole trader checklist sets out what you need to have in place.

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DigiTaxHub.co.uk is an independent information resource and is not affiliated with or endorsed by HMRC. This article is for information purposes only and does not constitute tax or financial advice. Always verify current rules at GOV.UK and speak to a qualified accountant if you are unsure.