Xero vs QuickBooks UK: prices, MTD and automation compared (with Sage)
Xero vs QuickBooks for UK small businesses: prices excluding VAT, the 90% off offers, MTD for Income Tax, payroll, CIS, automation and how Sage compares.
Published · Updated · By Edgars Lapins
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Xero and QuickBooks are both online accounting tools for small businesses, with UK plans priced in pounds. Both connect to your bank and are ready for Making Tax Digital, and both offered 90% off for the first 6 months when we checked. Where they differ is in plan limits, payroll and how much routine work each one automates. This guide compares them in pounds, then looks at Sage Accounting in case it’s on your list too.
Prices and features checked on Xero's UK pricing page, QuickBooks' UK pricing page, QuickBooks Online UK page and Sage Accounting's UK pricing page, and MTD dates on GOV.UK's Making Tax Digital for Income Tax guidance, on 27 October 2026. Prices and offers change often, so check before you buy.
The short answer
- Sole trader, not VAT registered: Xero Simple is the cheapest full price we saw, at £7 a month. QuickBooks Sole Trader Plus is £10, but it doesn’t submit VAT returns, so you’d need to upgrade if you register for VAT.
- Small VAT registered business: QuickBooks Simple Start (£16) costs a little less than Xero Ignite (£18). Xero Ignite caps you at 20 invoices and 10 bills, so check how many you handle.
- Growing team with lots of bills and invoices: Xero Grow (£39) adds unlimited invoices, automated bill entry and auto reconcile. Xero says it has no per user licence fees.
- Business with stock, projects or several currencies: compare QuickBooks Plus (£56, inventory and projects) with Xero Comprehensive (£55, multiple currencies) and Ultimate (£70, projects).
- You want payroll included from day one: look at Sage Accounting, which includes payroll for 1 employee on its £20 Start plan.
UK prices compared
All prices are per month, excluding VAT. The offer prices are for new customers and last for the first 6 months only.
| Xero plan | Full price | First 6 months | Who it’s for |
|---|---|---|---|
| Simple | £7 | £0.70 | Not VAT registered, up to 10 invoices |
| Ignite | £18 | £1.80 | VAT returns, up to 20 invoices and 10 bills |
| Grow | £39 | £3.90 | Unlimited invoices, automated bill entry |
| Comprehensive | £55 | £5.50 | Multiple currencies, payroll for 5 people |
| Ultimate | £70 | £7 | Projects, payroll for 10 people |
| QuickBooks plan | Full price | First 6 months | Users |
|---|---|---|---|
| Sole Trader Plus | £10 | £1 | 1 (no VAT submission) |
| Simple Start | £16 | £1.60 | 1 |
| Essentials | £38 | £3.80 | 3 |
| Plus | £56 | £5.60 | 5 |
| Advanced | £123 | £12.30 | 25 |
A few notes on these figures:
- VAT. Xero says “all prices are in GBP per month and exclude VAT”. QuickBooks shows its plan prices as ”+ VAT @20%” on its QuickBooks Online page. If you can’t reclaim VAT, add 20%.
- Xero’s offer is 90% off the base plan for 6 months for UK customers buying their first organisation on xero.com with the code shown on its pricing page. It doesn’t apply to add ons or usage fees.
- QuickBooks’ offer is 90% off for 6 months when you buy straight away. It can’t be combined with the 30 day free trial, so you pick one.
- Free trials. QuickBooks offers a 30 day free trial. Xero’s offer terms describe a 30 day free trial with limited features. Xero’s UK pricing page also shows a “Get one month free” option, but its offer terms say the one month free offer is only for certain customers in the United States and New Zealand, so check what you’re signing up for.
- Billing. Both bill monthly. Xero’s pricing FAQ describes monthly invoicing and plans that auto renew until you cancel.
Automation: bank feeds, bills and apps
Most of the time you save with accounting software comes from not typing things in. Here’s what each one lists:
- Bank feeds. QuickBooks lists automated bank feeds and automated bookkeeping on every plan. Xero says its direct bank feeds cost nothing extra for most customers, but some UK banks charge fees that Xero passes on.
- Reconciling. Xero includes auto reconcile from Grow. On Ignite it’s an optional add on at £3.50 a month.
- Receipts and bills. Xero includes smart document capture on every plan (receipts only on Simple), automated bill entry from Grow, and Hubdoc on all plans. QuickBooks includes receipt capture on every plan and adds bills and bill payments from Essentials. QuickBooks Advanced adds workflow automation.
- Connecting other tools. QuickBooks says every plan can integrate with hundreds of apps, and Xero has its own app store. Both have connectors on automation platforms: Zapier (Zapier's Xero integrations, Zapier's QuickBooks integrations), Make (Make's Xero app documentation, Make's QuickBooks app documentation) and n8n (n8n's Xero integration, n8n's QuickBooks Online integration). Our n8n vs Make vs Zapier guide can help you pick between them.
If you want orders or jobs to turn into invoices automatically, see how to send invoices to Xero with Make, with UK VAT and our guide to automating invoices and bookkeeping with AI. Have a person check the VAT codes before anything is sent.
Making Tax Digital for Income Tax
MTD for Income Tax means sole traders and landlords keep digital records and send quarterly updates to HMRC using recognised software. According to GOV.UK's Making Tax Digital for Income Tax guidance, you need to use it from 6 April 2026 if your qualifying income was over £50,000 in the 2024 to 2025 tax year, from 6 April 2027 if it was over £30,000 in 2025 to 2026, and from 6 April 2028 if it was over £20,000 in 2026 to 2027. GOV.UK says partnerships will also need to use it in the future, with a timeline to follow.
Every Xero plan and every QuickBooks plan is listed as MTD for Income Tax ready, so either will do. The difference is VAT: QuickBooks Sole Trader Plus doesn’t submit VAT returns, while Xero Ignite and QuickBooks Simple Start and above do. For details, see Xero's Making Tax Digital page and QuickBooks' Making Tax Digital page.
Payroll, CIS, multiple currencies and stock
| Feature | Xero | QuickBooks |
|---|---|---|
| Payroll | £1.50 a person on Ignite. Included for 1 person on Grow, 5 on Comprehensive and 10 on Ultimate | Paid add on from Simple Start: Core £5 plus £1.50 an employee, Premium £10 plus £2, Elite £15 plus £3 |
| CIS | Xero’s pages disagree: Xero's Simple plan page lists automated CIS calculations, but Xero's CIS returns page says CIS is available from Ignite. Filing CIS returns costs an extra £5 a month. CIS contractors should check with Xero before choosing Simple | Calculate and submit CIS on every plan |
| Multiple currencies | From Comprehensive | From Essentials |
| Stock | Up to 4,000 finished items, per Xero’s inventory page. Its pricing page doesn’t say which plans include it, so check | Inventory from Plus |
Xero charges £1.50 for each extra person paid on Ignite to Comprehensive and £1 on Ultimate. Its payroll page says it files Real Time Information (RTI) reports with HMRC after every pay run. QuickBooks also offers 90% off its payroll add on for 6 months, or a 30 day trial. For stock, check Xero's inventory page before you buy to see which Xero plans include it.
How Sage Accounting compares
Sage Accounting is another online option with UK plans priced in pounds. On its UK pricing page, all three plans include payroll and its Sage Copilot assistant:
| Sage plan | Full price | First 6 months | Users | Payroll included |
|---|---|---|---|---|
| Start | £20 | £2 | 1 | 1 employee |
| Standard | £43 | £4.30 | 3 | 1 employee |
| Plus | £59 | £5.90 | Unlimited | 5 employees |
- VAT. Sage shows its prices excluding 20% VAT.
- Payroll. Extra employees cost £1.85 each a month on every plan.
- CIS, stock and currencies. Sage describes Standard as the plan for businesses working with suppliers, CIS or accrual accounting, and Plus as the plan for inventory or multiple currencies.
- Receipts. Snap and scan isn’t included on Start. Standard includes 30 captures and Plus 100, then £0.20 each.
- Trial. You can skip the 90% offer and get 1 month free on any plan instead.
Sage makes sense if you’d pay for payroll anyway. If you don’t run payroll, Xero and QuickBooks have cheaper entry plans.
Switching from one to the other
Switching takes some planning, and timing matters:
- Pick a clean start date, such as the start of a VAT quarter or your financial year. That way each return sits in one system.
- Move the basics first. QuickBooks lets you import customers, suppliers, items and your chart of accounts from Excel. Then reconnect your bank feeds and check your opening balances with your accountant.
- Keep your old records. QuickBooks says cancelling takes effect at the end of the monthly billing period, with no pro rata refund. Export what you need before you go.
- Reconnect your apps and automations, as anything built on the old system will stop working.
When to get help
You can set up either system for a small business yourself. Help is worth paying for if you want to move years of records, connect your accounts to your shop, CRM or job system, or automate invoices and bill capture without errors.
In our directory, Xero is mentioned by 28 agencies. In the UK, workflow automation is mentioned by 231 agencies and document processing, which covers reading invoices and receipts, by 45 agencies. Browse workflow automation agencies or document processing agencies, or use Get matched and we’ll suggest suitable agencies at no cost.
Good for
- Xero: growing teams that want unlimited invoices and automated bill entry from Grow, with no per user fees
- QuickBooks: sole traders and small VAT registered businesses watching the monthly price
- Sage Accounting: small businesses that want payroll included from the first plan
Not for
- Xero Ignite: businesses sending more than 20 invoices a month
- QuickBooks Sole Trader Plus: anyone who needs to submit VAT returns
- Any of them: anyone expecting the 90% off price to last beyond 6 months
