Let’s be honest, most sole traders don’t enjoy bookkeeping.
That means it often gets left until the weekend, the end of the month, or when a tax deadline starts getting close.
The biggest problem is that bookkeeping doesn’t become easier the longer you leave it. It becomes harder and more stressful.
If you’re preparing for Making Tax Digital (MTD), keeping your records up to date each month will make every quarterly update much simpler. If you aren’t thinking about MTD just yet, the problem can snowball as you think you have time before the January deadline.
Bookkeeping isn’t only about tax
Many people think bookkeeping is something you do to keep HMRC happy. It does, by helping you stay compliant, but (and this is the important bit) it also helps you understand your business.
When your records are current, you can see:
- How much money you’ve actually earned
- What you’ve spent
- Whether you’re making a profit
- Which months are stronger than others
- If cash flow could become a problem
Instead of guessing, you have accurate and up-to-date information when you need it.
MTD works best with up-to-date records
Making Tax Digital is based on keeping digital records throughout the year.
Every quarter you’ll need to send an update to HMRC using compatible software.
If your bookkeeping has been kept up to date each month, that quarterly update is largely complete already.
If you’ve left several months of invoices, receipts and bank transactions untouched, you’ll have a much bigger job before every submission.
The longer you leave it, the longer it takes
It’s easy to remember what happened last week. Even though we kid ourselves, it’s much harder to remember what happened four months ago.
As more time passes, it’s easier for receipts to go missing, payments become harder to identify and legitimate business expenses are more likely to be forgotten.
The longer bookkeeping is delayed, the more time it usually takes to finish properly.
Regular bookkeeping helps you spot problems earlier
Keeping your accounts updated every month means you notice changes sooner.
You may spot:
- Costs increasing
- Customers paying more slowly
- Income falling
- Spending that’s higher than expected
Small issues are often much easier to deal with when you see them early.
It also makes your accountant’s job easier
Accurate, organised records help your accountant work more efficiently, giving them more time to provide advice that benefits your business.
Instead of spending time trying to rebuild your records, your accountant can focus on helping your business.
That becomes even more valuable once quarterly MTD updates become part of normal business life.
You don’t need to do everything yourself
Many sole traders worry they’ll have to become bookkeeping experts.
You don’t.
The right software makes recording transactions much easier, and having an accountant review your records gives you confidence that everything is staying on track.
That’s exactly how Brease works.
We help you keep your bookkeeping up to date throughout the year, so you always know where your business stands and you’re prepared for both your MTD updates and your Self Assessment tax return.
Make bookkeeping one less thing to worry about
Keeping your bookkeeping up to date every month helps you understand how your business is performing while making tax deadlines much easier to manage.
With Brease, your records stay organised throughout the year, giving you confidence that you’re ready for your Self Assessment tax return, Making Tax Digital updates and any questions that come up along the way.
Brease combines easy-to-use accounting software with support from real accountants, so you can spend less time worrying about paperwork and more time focusing on your business.
Get your instant quote today and discover how simple bookkeeping can feel.
Looking for more simple business advice?
This guide is part of the Brease Guides collection, created to help sole traders understand bookkeeping, tax and Making Tax Digital without the jargon.
