FreeAgent vs Xero
Last updated October 2026
Looking for a European alternative to Xero? Here's how FreeAgent compares, on EU hosting, GDPR and what it does.
Our pick for a European buyer: FreeAgent. We weight data residency, GDPR and EU jurisdiction above everything else — that is the constraint this directory exists to solve.
What it is
UK accounting software for freelancers and small businesses
Cloud accounting software for small businesses and their advisors.
Headquarters
🇬🇧 GB
🇳🇿 NZ · 2006
EU data residency
Yes, for all customers
Not offeredXero has no plans to store data in the EU.
DSGVO / GDPR
Yes
Yes
Certifications
Cyber Essentials Plus
ISO/IEC 27001:2022, SOC 2
Price from
£5/mo
No
Free plan
Yes
No
Open Source
No
No
Ratings
No
Integrations
Tyl by NatWest, Stripe, GoCardless, PayPal, Pleo +7
Payroll, Payment gateways, Inventory management, CRM
Where each one wins
FreeAgent
Strengths
- +Intuitive and user-friendly interface with a well-organized dashboard
- +Automatic bank and PayPal transaction imports for streamlined bookkeeping
- +Built-in tax, National Insurance, and HMRC RTI submission automation
- +Pension auto-enrolment and payslip generation features
- +Quick and straightforward onboarding and setup process
- +Free plan for RBS business users and discounts for annual upfront payments
- +Reliable real-time HMRC compliance and transaction processing
Limitations
- −Higher pricing compared to competitors, perceived as expensive for small businesses
- −Mobile app lacks features like split transactions and has small, hard-to-read text
- −Interface for viewing recent expenses described as clunky and prone to freezing
Xero
Strengths
- +User-friendly interface for non-accountants
- +Strong multi-currency support
- +Real-time collaboration with advisors
Limitations
- −No EU data residency option
- −Limited customization for complex workflows
- −Learning curve for advanced features
Data residency & compliance
FreeAgent
Xero
EU data residency
Yes, for all customers
Not offeredXero has no plans to store data in the EU.
Transfer mechanism
Not required — data stays in the EU
not established
Certifications
Cyber Essentials Plus
ISO/IEC 27001:2022, SOC 2
Pricing
FreeAgent
- UK Limited Companies (monthly) £33/month (introductory £16.50/month for first 6 months) per month, excludes 20% VAT50% off for first 6 months · Includes invoicing, expenses, tax filing · 30-day free trial
- UK Limited Companies (annual) £330/year (introductory £165/year for first year) per year, excludes 20% VAT50% off for first year · Equivalent to £13.75/month · 30-day free trial
- UK Partnerships or LLPs (monthly) £27/month (introductory £13.50/month for first 6 months) per month, excludes 20% VAT50% off for first 6 months · Includes invoicing, expenses, tax filing · 30-day free trial
- UK Partnerships or LLPs (annual) £270/year (introductory £135/year for first year) per year, excludes 20% VAT50% off for first year · Equivalent to £11.25/month · 30-day free trial
- UK Sole Traders (monthly) £19/month (introductory £9.50/month for first 6 months) per month, excludes 20% VAT50% off for first 6 months · Includes invoicing, expenses, tax filing · 30-day free trial
- UK Sole Traders (annual) £190/year (introductory £95/year for first year) per year, excludes 20% VAT50% off for first year · Equivalent to £7.92/month · 30-day free trial
- UK Unincorporated Landlords (monthly) £10/month (introductory £5/month for first 6 months) per month, excludes 20% VAT50% off for first 6 months · Includes property income and expense tracking · 30-day free trial
- UK Unincorporated Landlords (annual) £100/year (introductory £50/year for first year) per year, excludes 20% VAT50% off for first year · Equivalent to £4.17/month · 30-day free trial
- Free plan Free with qualifying NatWest, RBS, Ulster Bank, or Mettle bank account (min. 1 transaction/month)No monthly fee · Full feature access · 30-day free trial not applicable
- Add-ons (monthly) Smart Capture Unlimited: £5/month, Amazon UK Marketplace: £6/month billed monthlyUnlimited receipt and bill captures · Amazon UK Marketplace connection
All prices exclude 20% VAT. Introductory discounts apply for the first 6 months or first year. Free plan requires a qualifying bank account with at least one transaction per month.
Xero
No published pricing we could verify.
Pricing details are not provided in the research.
Features
FreeAgent
- Daily admin
- Dashboard with cashflow, profit and loss, invoices, and tax timelines, Mobile app for expenses, time tracking, and invoice management, Radar for tailored business insights and trend-spotting, Automated invoicing with reminders and online payments
- Tax management
- Generate and file MTD-compatible VAT returns directly to HMRC, Real-time Self Assessment tax view and filing, Generate and file Final Accounts and Corporation Tax returns, Tax Timeline for real-time tax calculations and due dates
- Financial management
- Bank feeds for automatic transaction imports, Smart categorisation of transactions based on history, Cashflow tracking and forecasting, One-click payments via Tyl by NatWest, Stripe, GoCardless, PayPal
- Connectivity
- Sync with bank accounts, Direct connection to HMRC for filings, Integrations with third-party apps for extended functionality
- Payroll
- Run monthly payroll, File PAYE and National Insurance to HMRC
Xero
- Accounting
- Invoicing, Expense tracking, Bank reconciliation, Financial reporting
- Collaboration
- Advisor access, Real-time collaboration, Role-based permissions, Audit trail
- Integrations
- Payroll add-ons, Payment gateways, Inventory management, CRM connectors
- Compliance
- GDPR compliance tools, Data retention controls, Audit logs
- Security
- Two-factor authentication, Data encryption, Regular security audits