Xero publishes a UK customer figure: about 1.32 million UK customers at 31 March 2026, up 14% in a year. Sage and Intuit, which makes QuickBooks, report the UK inside wider regions, so any market share split you see for UK accounting software is an estimate. HMRC's research does show that most VAT-registered businesses now use full accounting software and that a large minority use bridging software, with many talking the change through with an accountant or bookkeeper first.
In this article
The short version
- Xero reports about 1.32 million UK customers at 31 March 2026, up 14% in a year.
- Sage and Intuit publish no UK customer count, so UK market share splits are estimates.
- HMRC found 74% of the 2019 MTD for VAT group used full software and 14% bridging software.
- Most businesses discussed MTD with an adviser, so a practice's software choice tends to shape its clients'.
- Your own client list tells you which integrations you need better than any national figure.
What the published figures show
Xero's results for the year to 31 March 2026 put its UK customers at about 1.32 million, up 14% on a year earlier, out of 4.92 million worldwide. Xero said part of the UK growth came from early take-up ahead of MTD for Income Tax. If you quote it, bear in mind that "customers" is Xero's subscription measure, not a count of businesses: one business can hold more than one subscription, and practices like yours hold some on behalf of clients.
Sage and Intuit don't publish a comparable number. Sage reports the UK inside a region that also covers Ireland, Africa and Asia Pacific, and Intuit reports all of its revenue outside the US as a single figure. Neither gives a UK customer count, so a table showing each vendor's UK share has been estimated somewhere along the way.
That doesn't make share figures useless, but it's worth asking four things before you repeat one to a client: who counted, what they counted as a customer, whether the figure is UK-only, and when it was measured. A share built on a vendor survey, or on a global total, can look precise and still not describe the UK.
For scale, the Department for Business and Trade estimates there were 5.7 million private sector businesses in the UK at the start of 2025, and 4.27 million of them, about 75%, had no employees. Set against that, even Xero's figure covers only part of the market, so you can't read any one vendor's number as a picture of your own clients.
How businesses use software for MTD
The best official evidence on how businesses actually use software comes from HMRC's evaluation of Making Tax Digital for VAT, published in February 2025. It looked at two groups of VAT-registered businesses:
- Of businesses brought into MTD from April 2019, 74% were using fully functional software and 14% were using bridging software.
- Of those brought in from 2022, generally smaller businesses, 54% were using fully functional software and 26% bridging software.
Bridging software connects records kept in a spreadsheet or another tool to HMRC, so the business can file without moving onto a full ledger. The jump in bridging use between the two groups suggests smaller businesses are more likely to keep their spreadsheets and add a filing tool, and you may well have seen the same with your own smaller clients.
The same evaluation found that 65% of the 2019 group and 55% of the 2022 group prepared by discussing the changes with a tax agent such as an accountant or bookkeeper. That matters for a practice: many businesses talk their software changes through with an adviser, and that adviser is often you.
MTD for Income Tax brings in sole traders and landlords, many of them smaller than the VAT groups HMRC studied. It's reasonable to expect a fair share of them to start on spreadsheets and bridging software, at least at first, so your MTD client list may span more tools than your VAT clients do.
What it means for your practice
National share figures matter less than your own list. Count which ledger each client is on, including spreadsheets, and you'll know which integrations you need and which software you'll be supporting. If you recommend one ledger to new clients, that choice is likely to shape your book over time, since many businesses take their adviser's lead.
Payment data points the same way as Xero's growth. Of the businesses actively collecting payments through Adfin, mostly small businesses and accountancy practices, 72% are connected to Xero and 18% to QuickBooks. That describes businesses that chose a UK payment platform, not the whole country, but it shows where Adfin's customers keep their books.
For your own fees, the ledger matters because your payments have to land in it against the right invoice. Adfin has a two-way sync with Xero and QuickBooks and is an approved Xero payment partner, so a fee collected by direct debit, card or pay by bank is matched back to the invoice without anyone retyping it. If a client's on other software, you can still invoice them by uploading a PDF or spreadsheet, and AI Customer Agents chase anything unpaid within rules you set.
Common questions
What is the most used accounting software in the UK? There's no reliable UK market share split. Xero publishes about 1.32 million UK customers; Sage and Intuit don't publish a UK customer count.
How many UK customers does Xero have? About 1.32 million at 31 March 2026, up 14% on a year earlier. That's Xero's subscription measure, so it isn't the same as the number of businesses using it.
Do Sage and QuickBooks publish UK customer numbers? No. Sage reports the UK inside a wider region, and Intuit reports all revenue outside the US as one figure.
Do most businesses use full accounting software for MTD? Among VAT-registered businesses, yes: 74% of the 2019 group and 54% of the 2022 group used fully functional software, according to HMRC's evaluation.
What is bridging software? Software that connects records kept in a spreadsheet or another tool to HMRC, so a business can file under MTD without moving onto a full ledger.
Does it matter which ledger my clients use? It matters for integrations. Your payment and chasing tools need to sync with the ledgers your clients and your practice actually use, which for many small practices means Xero or QuickBooks.
Sources
- Xero - FY26 annual results market release (accurate as of October 2026) https://announcements.asx.com.au/asxpdf/20260514/pdf/06zkqzlkq0xnph.pdf
- HMRC - Making Tax Digital for VAT final evaluation (accurate as of October 2026) https://www.gov.uk/government/publications/making-tax-digital-for-vat-final-evaluation/making-tax-digital-for-vat-final-evaluation
- Department for Business and Trade - Business population estimates for the UK and regions 2025 (accurate as of October 2026) https://www.gov.uk/government/statistics/business-population-estimates-2025/business-population-estimates-for-the-uk-and-regions-2025-statistical-release
- HMRC - Find software that's compatible with Making Tax Digital for Income Tax (accurate as of October 2026) https://www.gov.uk/guidance/find-software-thats-compatible-with-making-tax-digital-for-income-tax
- Adfin - Payments and credit control for accountants (accurate as of October 2026) https://www.adfin.com/accountants
