2 min read HMRC

How to Use HMRC's Free Software to File Your Tax Return

HMRC offers free tools to file your Self-Assessment and VAT returns — here is what is available, who can use it, and the limitations.
How to Use HMRC's Free Software to File Your Tax Return

HMRC provides free software tools to help individuals and small businesses file tax returns without spending money on commercial accounting software. These tools are suitable for straightforward tax affairs, though they have limitations that may mean commercial software is preferable as your business grows.

HMRC Online Services (Government Gateway)

HMRC's own online portal at gov.uk/file-your-self-assessment-tax-return allows you to file your Self-Assessment tax return directly. This is suitable for individuals with employment income, savings interest, dividends, and relatively simple self-employment. You log in with your Government Gateway credentials, work through a series of questions about your income and reliefs, and submit online. HMRC auto-populates some information from employer FPS submissions and savings interest data from banks.

HMRC's Free Software List

HMRC maintains a list of commercially developed free software approved for MTD for VAT and (from 2026) MTD for Income Tax. Many accounting software providers offer a basic free tier: FreeAgent is free for NatWest, Royal Bank of Scotland, Mettle, and Ulster Bank business customers; HMRC's own Basic PAYE Tools is free for employers running PAYE for up to 10 employees; some small business banking apps include basic tax filing tools.

Self-Assessment via HMRC's Portal: Who It Suits

HMRC's direct Self-Assessment online service is adequate if you have: a single employment plus possibly some self-employment income below £85,000; straightforward rental income; UK-only income sources; no complex capital gains; no need for forecasting or management reports. It does not provide accounting reports, profit and loss statements, or bank reconciliation — it is purely a tax return filing interface.

Limitations of Free Tools

Free tools generally lack: integrated bookkeeping and bank feeds; invoicing capabilities; automated expense categorisation; VAT return preparation (separate from filing); payroll; management accounts; multi-currency support. If you need any of these, a commercial solution (Xero from around £15/month, QuickBooks from £10/month, FreeAgent at similar pricing) is worth the investment — the cost is itself a deductible business expense.

MTD for Income Tax: What Software Will You Need?

From April 2026, self-employed people and landlords with income above £50,000 must use MTD-compatible software for quarterly reporting. HMRC's own portal will not support quarterly submissions under MTD ITSA — you will need commercial software. HMRC publishes a list of compatible software at gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-income-tax. Start evaluating options now rather than waiting until April 2026.

HMRC's App

HMRC has a free mobile app (HMRC: Tax and Benefits) available for iOS and Android. Through the app, you can view your tax code, check your income tax estimate for the current year, view your National Insurance record and State Pension forecast, set up and manage Simple Assessments, and receive notifications. You cannot file a full Self-Assessment return through the app, but it is a useful companion tool for keeping tabs on your tax position throughout the year.

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