I created the business startup spreadsheet template package for myself as everything I found elsewhere didn't fit my business model or was just not nice to use at all.
You must keep records of your business income and expenses for your tax return if you’re self-employed. You’ll also need to keep records of your personal income.
Because of the level of my income since I started hasn’t gone over the UK ceiling of £150,000 I haven’t had to change my book keeping system. I just use the Cash Basis Accounting system and the same business startup spreadsheet template package that I put together in the beginning as part of my business plan and running systems.
Do Not under estimate this worksheet as it will become the most important and most used when you are up and running.
Every penny that comes into and goes out of your business should be in this 12 month income and expenditure worksheet. The end figure should tell you your gross net income on which you will pay tax.
If like me, coffee is an essential to keep your work at home business office running smoothly then it should be included in your expenditure. Everything you purchase for your business should be in here.
Another tip, I know this is valid in the UK, if you purchase things out of your own business, purchase it at full retail cost. For example, if you have a laptop, you can purchase it off yourself through the company. That will make it a company asset and therefore it’s cost as a claimable expense. On top of that, you’ll get money straight from the company personally tax-free.
I have polished and updated these spreadsheets so they are easier to use and view with coloured segments in some of them so you can quickly identify columns and rows, sub-totals and totals.
On most of them I have also included instruction sections marked with a small red triangle and you just hover over these to display them.
I have been using this business startup spreadsheet template package since 2004 and find them perfect for my business then, and now. They have been updated, polished and adapted for all round use and acceptable for UK authorities and others around the world.
There are different rules on keeping records for sole traders, partnerships, limited companies and incorporated companies in the United Kingdom. So you will have to make sure of what you need to do in your country of origin. You’ll need to choose an accounting method.
Many businesses use traditional accounting where you record income and expenses by the date you invoiced or were billed.
Example: You invoiced a customer on 28 March 2018. You record that invoice for the 2017 to 2018 tax year - even if you did not receive the money until the next tax year.
Most small businesses with an income of £150,000 or less can use cash basis reporting.
With this method, you only record income or expenses when you receive money or pay a bill. This means you will not need to pay Income Tax on money you have not yet received in your accounting period.
Example: You invoiced someone on 15 March 2018 but did not receive the money until 30 April 2018. Record this income for the 2018 to 2019 tax year.
you need to keep them so you can:
You must make sure your records are accurate and keep proof
Types of proof include:
If you’re using traditional accounting as well as the standard records, you’ll also need to keep further records so that your tax return includes:
In the UK you must keep your records for at least 5 years after the 31 January submission deadline of the relevant tax year. HM Revenue and Customs (HMRC) may check your records (www.gov.uk/tax-compliance-checks) to make sure you’re paying the right amount of tax.
Example: If you sent your 2017 to 2018 tax return online by 31 January 2019, you must keep your records until at least the end of January 2024.