Xero
£16/mo est.
- Entry plan
- £16/mo (Ignite)
- Users included
- Unlimited
- UK payroll
- Yes
- VAT/MTD
- Yes
- Bank feeds
- Yes
- Est. monthly cost
- £16/mo
Xero
Cloud accounting popular with UK small businesses and accountants, with unlimited users on every plan and a deep app ecosystem.
- Entry plan
- £16/mo (Ignite)
- Users
- Unlimited
- Payroll
- ~£1.50/emp
- Bank feeds
- Yes
Best for
UK small businesses and their accountants wanting unlimited users and a deep app ecosystem.
How much does Xero cost per month?
Xero plans cost from £16/mo (Ignite) to £65/mo (Ultimate) in 2026. Payroll is included on every plan at no extra per-employee cost.
Pricing breakdown
All prices in GBPLast verified 5 August 2026Every fee we track, grouped by where it applies.
Strengths and trade-offs
Pros
- Unlimited users on every plan
- HMRC-recognised for MTD for VAT
- Hubdoc receipt capture included
- Largest UK app marketplace and accountant network
Cons
- Ignite plan caps invoices at around 20/mo
- Multi-currency only on Comprehensive and above
- Native inventory is basic
About Xero
Xero is a cloud accounting platform widely used by UK small businesses and their accountants. It offers tiered GBP plans from Ignite to Ultimate, with unlimited users on every plan and no per-user charge. It is HMRC-recognised for Making Tax Digital for VAT, includes Hubdoc receipt capture, and has the largest UK app marketplace. The entry Ignite plan caps invoices at around 20 per month, so growing businesses usually move up to Grow.
Xero was founded in 2006 and is headquartered in Wellington, New Zealand.
How Xero compares
Side-by-side with the closest alternatives by estimated cost.
Subscription plus payroll add-on, based on the entry plan with no employees. Processing fees not included.
FreshBooks
£16/mo est.
- Entry plan
- £16/mo (Lite)
- Users included
- 1
- UK payroll
- No
- VAT/MTD
- Yes
- Bank feeds
- Yes
- Est. monthly cost
- £16/mo
FreeAgent
£19/mo est.
- Entry plan
- £19/mo (Sole Trader)
- Users included
- Unlimited
- UK payroll
- Yes (included)
- VAT/MTD
- Yes
- Bank feeds
- Yes
- Est. monthly cost
- £19/mo
Sage
£20/mo est.
- Entry plan
- £20/mo (Accounting Start)
- Users included
- 1 (Start)
- UK payroll
- Yes (add-on)
- VAT/MTD
- Yes
- Bank feeds
- Yes
- Est. monthly cost
- £20/mo
Common questions about Xero
The same questions UK merchants ask before signing up.
Xero starts at £16/mo (Ignite) for the Ignite plan, with the mid-tier Grow plan at £37/mo (Grow) and the top Ultimate plan at £65/mo (Ultimate). Every plan includes Unlimited users, which is unusual: most rivals charge per seat or cap you at one user on the entry plan. Plans are month to month.
Yes. Payroll is built into Xero rather than bolted on, at ~£1.50/emp. It runs PAYE with RTI submissions to HMRC and handles pension auto-enrolment assessments. That makes Xero one of the few options here where you do not need a second subscription to pay staff.
Xero allows Unlimited users on every plan. There is no per-seat charge, so you can invite your bookkeeper, accountant, and as many team members as you need without an increase in your monthly subscription.
Yes. Xero is Making Tax Digital compatible, so a VAT-registered business can calculate and submit its VAT return to HMRC from inside Xero without exporting to a bridging tool. VAT is tracked automatically as you code transactions. Xero also supports MTD for Income Tax Self Assessment, and CIS is available as an add-on for construction businesses.
The Ignite plan includes Unlimited bank feed connection. Grow and higher plans include unlimited bank feeds, which suits businesses with multiple accounts, credit cards, or loan facilities.
They start at the same price and stay within a pound or two through the mid tier, so the headline is a wash. The real difference is what the plan includes: Xero bundles payroll and unlimited users, while QuickBooks charges ~£1.50/emp for payroll on top and starts at one user. QuickBooks answers back with broader compliance coverage, adding Self Assessment and CIS. For an employer, Xero is usually cheaper all-in; for a sole trader who wants Self Assessment in the same tool, QuickBooks is the better buy.
No. Xero is a rolling monthly subscription with no minimum term, so you can upgrade, downgrade or cancel at any time. Note that promotional discounts for new subscribers revert to the standard rate shown here, so budget on the ongoing price rather than the introductory one.
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