What Records do Self Employed Businesses Need to Keep?

Business Owners must keep records of business income and expenses for your tax return if you’re self-employed as a Sole Trader or Partner in a Business Partnership.

What Records do Self Employed Businesses Need to Keep?

You’ll need to keep records of:

???? All sales and income

???? All business expenses

???? VAT records IF you’re registered for VAT

???? PAYE records if you employ people

???? Records about your personal income            

You don’t need to send your records in when you submit your tax return but you will need to use the information from those records to complete your Personal Tax Return. You will need to work out your profit and enter that on your Tax Return.

You’ll also need to be able to produce your Records and show them to HM Revenue and Customs (HMRC) if asked so make sure you keep all your information safe and to hand.

What else?

Well, you must make sure your records are accurate and you need to keep proof (which means keeping receipts, bank statements, till rolls and invoices). In addition you need to keep a record of what any monies that you are owed, anything you’ve commited to spend but haven’t paid out yet, the value of any stock, how much you’ve invested in your business and any money that you’ve taken out and used for your own use.

Our Advice

Firstly we recommend that you use Accounting Software. It makes keeping the RIGHT documentation and records so much easier, plus if you use good software you won’t need to keep any paper records at all (amazing)! Take a look at Xero here (which we highly recommend), or alternatively QuickBooks.

Secondly, if you aren’t sure about what to keep or how to complete your Personal Tax Return ask an Accountant and/or refer to the HMRC website for guidance.

You have been reading;

What Records do Self Employed Businesses Need to Keep?

If you need help or support to complete your Personal Tax Return just get in touch. We are taking bookings from mid April 2020 ???? Get your Return completed early and you’ll know exactly how much you owe and what you need to pay by 31st January.