Xero price increase 2026: what changed on 1 September, and what to do
On this page
- 1.Accounting software for non-accountants: the best UK options in 2026
- 2.How to switch from Xero to Ledgers (without losing your history)
- 3.QuickBooks UK prices in 2026: what each plan costs, and what to check
- 4.Xero price increase 2026: what changed on 1 September, and what to do
Xero's UK prices rose on 1 September 2026: Ignite £18, Grow £39, Comprehensive £55, Ultimate £70. Simple stays £7. What it costs you, and what to do.
Prices checked on 13 October 2026 against Xero's UK pricing page, its UK pricing update notice and its Simple plan page. All Xero and Ledgers prices in this post exclude VAT.
What changed on 1 September 2026
Xero raised the monthly price of four of its five UK plans from 1 September 2026. The change applies to new and existing UK subscribers, and Xero's notice says its figures don't include optional add-ons. The reason it gives is continued investment in the product.
| Plan | Old price a month | New price a month | Difference a month | Difference a year | What the plan includes or limits |
|---|---|---|---|---|---|
| Simple | £7 | £7 | £0 | £0 | Only for businesses not registered for VAT. Up to 10 invoices and quotes a month, MTD for Income Tax, receipt capture. No VAT returns or payroll |
| Ignite | £16 | £18 | +£2 | +£24 | 20 invoices and 10 bills a month, VAT returns, payroll at £1.50 per person, auto-reconciliation £3.50 a month extra. No expenses or multi-currency |
| Grow | £37 | £39 | +£2 | +£24 | Unlimited invoices and bills, auto-reconciliation, payroll for 1 person, expenses for 1 user |
| Comprehensive | £50 | £55 | +£5 | +£60 | Adds multi-currency, payroll for 5 people, expenses for 5 users |
| Ultimate | £65 | £70 | +£5 | +£60 | Adds projects, payroll for 10 people, KPI analysis and benchmarking |
In percentage terms, Ignite rose 12.5%, Grow about 5%, Comprehensive 10% and Ultimate about 8%.
Two other points in Xero's notice matter as much as the table:
- The multi-organisation discount has gone. In Xero's words, from 1 September 2026 "the multi-organisation discount will no longer be applied to subscriptions". If you run several organisations, your bill may have risen by more than the headline figures.
- Existing discounts and promo codes still apply to the new prices until they expire. If you joined on an introductory offer, you'll see the full new price when that offer ends.
Add-ons sit on top of the plan price. From Xero's pricing page: submitting CIS contractor returns is £5 a month on any plan, extra payroll people are £1.50 each (£1 on Ultimate), extra Expenses users are £2.50 each from Grow, and the optional company accounts and tax add-on is £120 a year.
What it means for your business
A sole trader who isn't VAT registered
If Simple is enough for you, the rise passes you by. It stayed at £7 a month, and it's built for this case: a sole trader or landlord who needs MTD for Income Tax and sends no more than 10 invoices a month. Its document capture covers receipts only. At the time of writing, Xero's MTD campaign page describes MTD for Income Tax filing as in beta, subject to registration and eligibility.
Send more than 10 invoices a month and you need Ignite, now £18. That's £216 a year, against £84 for Simple. If you're not VAT registered you can't reclaim the VAT on the subscription, so the real monthly cost is £8.40 for Simple and £21.60 for Ignite.
A VAT-registered small company
Simple can't file VAT returns, so Ignite at £18 is the starting point. Before you settle on it, check its two limits: 20 invoices and 10 bills a month. A company that receives more than ten supplier bills a month needs Grow, now £39 a month, or £468 a year.
For most small companies on Grow, the rise is £2 a month: £24 a year. That's real money, but on its own it's rarely a reason to move your books.
A business with payroll
Payroll is priced per person, and your plan decides how many people are included:
- Ignite: none included, £1.50 per person
- Grow: 1 included, then £1.50 each
- Comprehensive: 5 included, then £1.50 each
- Ultimate: 10 included, then £1 each
An illustration at today's prices: a company with four people on payroll pays £18 + (4 × £1.50) = £24 a month on Ignite, if it stays within Ignite's invoice and bill limits, or £39 + (3 × £1.50) = £43.50 a month on Grow. If it also needs multi-currency, Comprehensive covers all four people for £55.
With per-person charges, the cheapest plan depends on your headcount. Do the sum for your own team rather than reading the headline price.
Groups with several companies
Each Xero organisation is its own subscription, so a group pays the rise once per company, and from 1 September it also lost the multi-organisation discount. Xero's notice doesn't say how big that discount was, so the clearest check is to compare an invoice from before September with one from after.
An illustration using headline prices only: a group with a holding company and a property company on Ignite and a trading company on Grow went from £16 + £16 + £37 = £69 a month to £18 + £18 + £39 = £75 a month. That's £6 a month, or £72 a year, before any lost discount.
What to do now
1. Check you're on the right plan
A price rise is a good moment to look at what you actually use. Common mismatches:
- On Ignite, not VAT registered, and sending 10 or fewer invoices a month. Simple at £7 may cover you.
- On Grow mainly for automatic reconciliation. Ignite plus the £3.50 auto-reconcile add-on is £21.50 a month against £39 for Grow, if you stay within Ignite's 20 invoices and 10 bills.
- On Comprehensive mainly for payroll. If you have fewer than five people and don't need multi-currency, price Grow plus per-person charges instead.
- Paying for an add-on you no longer use, such as CIS returns after you've stopped working in construction.
2. Monthly or annual billing
Xero bills its UK plans monthly. Its pricing page doesn't offer an annual plan at a discount; the only yearly charge is the optional company accounts and tax add-on. So there's no saving to be had there.
At the time of writing (13 October 2026), new UK customers buying their first organisation can get 90% off for six months with a promo code, or try a month free. That helps if you're setting up a new organisation, but the regular price applies afterwards and the discount doesn't cover add-ons.
3. Count what you'd lose by switching
A £2 or £5 rise is rarely, by itself, a good enough reason to move. Before you look elsewhere, weigh up:
- Your accountant's familiarity. Xero is widely used by UK accountants. If yours works in it, moving could cost you more in their time than you save on the subscription.
- The app ecosystem. Xero connects to a large marketplace of apps. If you rely on one, check the alternative supports it.
- Filing from the same software. Xero submits VAT returns from Ignite, lists MTD for Income Tax on every plan, runs payroll and files RTI, and sells CIS returns and company accounts as add-ons. An alternative that doesn't file means a second tool, or your accountant, for that part.
- Your history. You can take it with you, but it needs planning. Our guide on how to switch from Xero without losing your history walks through exports and opening balances.
4. Look at the alternatives
FreeAgent is free for as long as you hold a NatWest, Royal Bank of Scotland or Ulster Bank business current account, or a Mettle account with at least one transaction a month (Mettle doesn't qualify for the partnership plan). It files VAT, MTD for Income Tax and payroll. Without a qualifying account it's £19 a month for sole traders and £33 for limited companies, excluding VAT. If you already bank with one of those, it's hard to beat on price. Our FreeAgent comparison covers it in more detail.
QuickBooks starts at £10 a month. We've set out what each QuickBooks UK plan costs in 2026.
For the three-way view on price and filing, see Xero vs FreeAgent vs Ledgers pricing.
Where Ledgers fits, stated plainly
We make Ledgers, so read this section with that in mind. Ledgers is UK accounting software in which AI agents categorise your bank transactions and reconcile your books for you, and you approve anything they're unsure about. It's priced mainly by how many transactions it processes each month, not by headcount. Prices exclude VAT:
| Ledgers plan | Per month | Transactions a month | What it adds |
|---|---|---|---|
| Free | £0 | 15 | Categorising and reconciling, daily briefing, accountant access |
| Solo | £4.99 | 50 | Receipt capture, more than one bank account. No invoicing |
| Starter | £29 | 100 | Invoicing, bills, VAT returns prepared for sign-off, year-end pack |
| Growth | £79 | 400 | CIS returns prepared for sign-off, FP&A pack |
Paying annually gives two months free (Solo is £3.99 a month billed annually), and moving your data across is free on every plan. The full detail is on the Ledgers pricing page.
What Ledgers doesn't do yet matters just as much. It doesn't file anything to HMRC or Companies House. It prepares your VAT return for you to sign off, but for now it is submitted from other MTD-compatible software that takes your records digitally, usually your accountant's (retyping the figures doesn't count). Direct VAT submission is coming. It doesn't file MTD for Income Tax updates, payroll RTI, the CT600 or annual accounts.
So, honestly:
- Stay on Xero if your accountant or bookkeeper works in it, if you need VAT, payroll and MTD for Income Tax filed from one product today, or if you depend on apps in its marketplace.
- Choose Xero Simple or FreeAgent if you're a sole trader or landlord who isn't VAT registered and your main need is MTD for Income Tax filing.
- Look at Ledgers if the cost that hurts isn't the subscription but the hours, yours or a bookkeeper's, spent categorising and reconciling. On software price alone, Xero Grow at £39 sits between Ledgers Starter at £29 and Growth at £79, so the case for switching rests on the work it takes off your desk, not on the rise.
The Ledgers vs Xero comparison goes through it feature by feature, and the switching page explains how a move works. If you'd like to see it on your own transactions first, you can try Ledgers free alongside Xero on up to 15 transactions a month.
Frequently asked questions
When did Xero's UK prices go up?
On 1 September 2026, for new and existing UK subscribers on the Ignite, Grow, Comprehensive and Ultimate plans. Simple was not part of the change.
How much did Xero go up by?
Ignite went from £16 to £18 a month, Grow from £37 to £39, Comprehensive from £50 to £55 and Ultimate from £65 to £70, all excluding VAT. That is £24 a year more on Ignite and Grow, and £60 a year more on Comprehensive and Ultimate. Xero says the figures don't include optional add-ons.
Did the price of Xero Simple change?
No. Simple stayed at £7 a month excluding VAT. It is only for businesses that are not registered for VAT, and allows up to 10 invoices and quotes a month.
Do Xero's prices include VAT?
No. Xero's UK prices exclude VAT. If you can't reclaim VAT, add 20%: Ignite costs £21.60 a month and Grow £46.80.
Does my existing Xero discount still apply?
Xero says existing discounts and promo codes continue to apply to the new prices until they expire. The exception is the multi-organisation discount, which Xero stopped applying from 1 September 2026.
Can I pay for Xero annually to save money?
Not on the standard plans. Xero's UK pricing page bills plans monthly and doesn't show an annual plan. The optional company accounts and tax add-on is the one item billed yearly, at £120.
Is Ledgers a cheaper alternative to Xero?
Sometimes. Ledgers is free for up to 15 transactions a month, Solo is £4.99 and Starter £29, all excluding VAT, and it categorises and reconciles for you. But it doesn't file anything to HMRC or Companies House yet. It prepares your VAT return for sign-off, and direct VAT submission is coming. If you need filing from one product today, Xero is the better fit.
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