AI accounting for UK sole traders — do less bookkeeping, bill more hours

Sole traders aren't accountants. You're a designer, builder, consultant, plumber, freelancer. Every hour you spend on bookkeeping is an hour you don't bill. Luca does the bookkeeping for you for £20/month.

Start — £20/month Free on GitHub

The sole trader bookkeeping reality

If you're a UK sole trader earning over £1,000 in self-employment income, HMRC needs Self Assessment from you. From April 2026, if your turnover is over £50,000, you're also required to do Making Tax Digital for Income Tax (MTD ITSA) — quarterly digital submissions instead of one annual return.

That means you need real bookkeeping: every transaction categorised, receipts stored, mileage tracked, allowable expenses identified. Most sole traders try to do this in a spreadsheet, fall behind, then panic in January.

How Luca handles sole trader books

Bank feed reconciliation

Connect your business bank account (Starling, Tide, Wise, Revolut, Monzo Business, NatWest, Barclays, etc.) via Open Banking. Luca pulls transactions live and categorises them automatically — you check the categorisations weekly rather than entering them yourself.

Receipt and expense capture

Email receipts to your Luca address. Photograph paper receipts via the mobile workflow. Luca extracts the supplier, amount, VAT and category, matches to the bank transaction, and files the image as the audit trail.

Mileage

Log business miles and Luca calculates the HMRC-allowable mileage expense (45p first 10,000 miles, 25p thereafter) and posts it to your books.

Income tracking

Issue invoices from Luca, or import them from your invoicing tool (FreeAgent, FreshBooks, Wave). Track paid vs unpaid. Chase late payers.

MTD ITSA quarterly submissions

Luca prepares your quarterly MTD for Income Tax submissions automatically. You review and approve; Luca submits to HMRC.

Self Assessment preparation

At year end, Luca produces the SA103 (self-employment) figures ready for your SA100 main return. Currently you'll file via your own SA tool or accountant; full SA filing inside Luca is on the roadmap.

What it costs

£20/month for the fully managed Luca hosted plan. Plus a Claude Co-Work Pro subscription (currently $20/month from Anthropic). Total around £40/month all-in.

If your bookkeeping currently takes you four hours a month and your billable rate is £40/hr, that's £160/month of your time. Luca pays for itself four times over.

What about FreeAgent?

FreeAgent is genuinely good for sole traders, especially if you bank with NatWest/RBS/Mettle (free with those). The trade-off is FreeAgent makes bookkeeping easier — Luca makes it autonomous. Full Luca vs FreeAgent comparison →

Open source — you can self-host free

If you have technical chops or know a friend who does, Luca is open source. Self-host on your own server for £0 software cost. You'll still need Claude Co-Work Pro.