What records do I have to keep?
By law, everyone must keep records of their income, and of any â€˜capital gainsâ€™, for at least 22 months after the end of the tax year – and if you are self-employed as a sole trader, youâ€™ll need to keep these records for at least five years and ten months after the end of the tax year.
Weâ€™d always recommend that you manage your finances in an organised fashion from Day One – in fact, as a self employed person itâ€™s a legal requirement. That doesnâ€™t necessarily mean investing in expensive accounting software, unless you feel you really need it – but instead, at a most basic level, keeping a record of every payment you receive from a customer and every business expense you have. If you enter everything into a simple spreadsheet in Microsoft Excel, youâ€™ll always know where you stand.
Youâ€™ll need to keep copies of every invoice or sales receipt and every expense receipt. Keep these somewhere safe, filed either by month or by customer â€“ whichever works best for you â€“ and make sure that you can find any individual piece of paper whenever you need it.
DownoadÂ ourÂ free Bookkeeping Spreadsheet
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