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How To Organise Your Accounts When Self Employed

surviving your first sales tax audit - woman at desk with calculator and laptop
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Life as a self employed single mum can be a bit of a juggle at times, so I am always looking for ways to save time. With that in mind, today I am sharing some tips which will show you how to organise your accounts when self employed. It is worth noting I am based in the UK, so this relates to UK guidelines and practices.

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How To Organise Your Accounts When Self Employed

The first thing you should do when you become self employed is to register with HM Revenue and Customs. This is where you have to file your tax returns every year. Honestly, I promise it’s not as daunting as you’d expect. I use just 3 really easy to follow spreadsheets to organise mine.

This Annual Income Spreadsheet allows me to keep track of all of my income throughout the tax year. I fill it in when I complete a job and then add the payment info when I receive a payment. It works really well. Additionally, because its on google notes, I can fill it in from my laptop or smartphone, so it’s super convenient.

This annual expenses spreadsheet¬†allows me to keep track of all of my expenses. I fill it in each time I make a business purchase or pay a bill. Finally, on the 1st of each month, I deduct the previous month’s expenses from the earnings of the same month to get the monthly NET earnings. Personally, I get a cup of tea and spend half an hour going over my expenses on the first working day of the month to make sure they are up to date.

organise your accounts when self employed

Image credit: Freestocks.org

Storing Digital Information Safely

I have a file on my laptop to store digital invoices and another for expenses receipts. These are saved to iCloud so that I can access them even if I were to lose my laptop. Some people choose to print them off and store paper copies, but I’m all for saving the trees. If you want more information on data management, gartner mdm are really insightful.

Storing Paper Information Safely

If you still receive paper invoices and bank statements, it is best to have a decent system in place to store them. Personally, I do everything digitally as I don’t have enough space at home to securely store paper receipts, invoices and statements. It is a good idea to have a receipt system in place if you make a lot of business purchases or payments in person.

Start by numbering all of your receipts and then inputting them onto a digital spreadsheet. Have a column for the receipt number, item purchased, cost and location purchased. It’s worth spending the time doing this digitally as when you submit your annual tax return, it will already be on your computer for you.

When it comes to storing the paper receipts, I’d opt for a metal, fire safe tin. This way you know they are likely to survive the worst.

Finally, if this post on how to organise your accounts when self employed has been useful, check out this post on becoming an entrepreneur.

 

 

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