SME Accounting
Accounting solutions for UK small businesses.
A free UK VAT calculator below. Then the case for picking proper, MTD-ready accounting software — and the one we'd hand to a friend.
In one paragraph
If you run a UK small business, you'll spend today doing the maths,and tomorrow filing it with HMRC.Calculator below for today. Software recommendation for tomorrow.
Tool 01
UK VAT
calculator
Add VAT to a net price, or extract it from a gross price. Standard rate, reduced rate and zero rate covered.
Mode
Rate
Result
- Net£0.00
- VAT (20%)£0.00
- Gross£0.00
Filing VAT returns? You'll need MTD-compatible software — our pick is below.
Background
VAT in the UK,
briefly
The basics every UK small business should understand before choosing accounting software. None of this is legal advice — speak to your accountant for that.
- № 01
Registration threshold
Mandatory once taxable turnover passes £90,000 in any rolling twelve-month period (raised from £85,000 in April 2024). Many businesses register voluntarily below this when most of their customers are VAT-registered.
- № 02
Making Tax Digital
VAT-registered businesses must keep digital records and submit returns via MTD-compatible software. ITSA MTD rolls out to sole traders and landlords from April 2026. Spreadsheets alone don't qualify — you need software with a digital link to HMRC.
- № 03
Flat Rate Scheme
Businesses with turnover under £150,000 can opt into the Flat Rate Scheme, paying VAT at a single industry-specific percentage of gross turnover. Simpler bookkeeping, but not always cheaper — check the maths against standard accounting first.
The pick
Pick MTD-ready
software
For day-to-day VAT maths the calculator above is plenty. For HMRC-facing work — VAT returns, payroll, Self Assessment — you need MTD-compatible software with a digital link to HMRC.
Recommended — № 01
FreeAgent
Built in Edinburgh. Owned by NatWest. Free for NatWest, RBS and Mettle business banking customers. Designed around UK rules — VAT returns, Self Assessment, CIS, Corporation Tax. The most "UK-native" option in a market dominated by international tools.
If you're a sole trader or freelancer who wants something lighter, Coconut and ANNA Money bundle a business account with bookkeeping and tax in one app.
Why we recommend it
- MTD-compatible VAT and Self Assessment
- Free for NatWest, RBS and Mettle banking customers
- Bank feeds, invoicing, expenses, payroll add-on
- UK-only product, UK-based support
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Last word