FreeAgent FAQ: Accounting Buyer Questions
FreeAgent is a cloud-based accounting software designed specifically for UK-based small businesses, freelancers, contractors, and their accountants. It simplifies daily financial management by automating invoice creation, expense tracking, bank feeds, Self Assessment tax returns, and Corporation Tax filings.
What is the FreeAgent pricing model?
FreeAgent uses a subscription-based pricing model with monthly or annual payment options for UK businesses, sole traders, partnerships, and limited companies. Pricing varies based on business structure, but many UK business owners can access FreeAgent completely free by opening or linking an eligible business bank account with NatWest, Royal Bank of Scotland, Ulster Bank, or Mettle.
Who is FreeAgent best for?
FreeAgent is ideal for UK freelancers, sole traders, contractors, and small limited companies with straightforward financial needs. It is particularly well-suited for service-based businesses that need integrated invoicing, project tracking, automated bank reconciliation, and direct tax filing to HM Revenue and Customs (HMRC).
Is FreeAgent good for freelancers and contractors?
Yes, FreeAgent is specifically tailored for UK contractors and freelancers operating through sole proprietorships or limited companies. It includes features built for IR35 tracking, mileage claims, automated dividend vouchers, and built-in Self Assessment submission, making contractor admin significantly simpler.
Is FreeAgent good for Making Tax Digital (MTD) and VAT compliance?
Yes, FreeAgent is a Making Tax Digital (MTD) end-to-end compliant accounting platform recognized by HMRC. It allows registered businesses to generate, track, and submit MTD for VAT returns directly to HMRC from within the software without requiring third-party bridging software.
How does FreeAgent compare to Xero?
While both platforms offer robust cloud accounting, FreeAgent includes built-in Self Assessment and Corporation Tax filing features at no extra cost, whereas Xero typically requires add-ons or accountant assistance for full tax filings. However, Xero offers a larger global third-party integration marketplace and scalable features for larger team structures.
How does FreeAgent compare to QuickBooks Online?
FreeAgent is tailored specifically to UK tax legislation and small business compliance out of the box, offering automated tax forecasts and direct tax filing. QuickBooks Online provides broader global multi-currency functionality and advanced inventory management, making it better suited for product-based businesses or companies operating outside the UK.
What integrations does FreeAgent support?
FreeAgent connects directly with major UK banks including NatWest, RBS, HSBC, Barclays, Lloyds, Santander, Revolut, and Starling for automated secure bank feeds. It also integrates with payment gateways like Stripe, PayPal, and GoCardless, e-commerce platforms like Shopify, and time-tracking or CRM tools via Zapier and its open API.
Does FreeAgent support multi-currency invoicing and tracking?
Yes, FreeAgent offers dedicated multi-currency functionality that allows users to create invoices, track expenses, and manage bank accounts in over 80 foreign currencies. The platform automatically converts foreign currency transactions into British Pounds (GBP) using daily exchange rate updates to simplify reporting.
How does FreeAgent support accountants and bookkeepers?
FreeAgent provides a dedicated Practice Dashboard for accountants and bookkeepers, allowing them to manage multiple client accounts from a single workspace. Accountants can access client data in real time, review tax calculations, make adjust journal entries, and collaborate seamlessly on year-end accounts.
How does FreeAgent handle tax calculations and HMRC filings?
FreeAgent simplifies tax management by automatically calculating real-time estimates for Income Tax, National Insurance, Corporation Tax, and VAT as income and expenses are categorized. Users can generate dividend vouchers, calculate tax liabilities on an ongoing basis, and submit tax filings directly to HMRC without exporting data.