I’m pretty sure you didn’t start your business dreaming about collecting receipts and entering data into spreadsheets, but if you’re not quite ready to work with a bookkeeper or don’t have the budget available yet, then you’ll have to be your own Chief Financial Officer for now!

To help you make the best job of it you can, I’ve compiled my guide to the recommended tasks, key deadlines, useful resources and those all-important top tips and timesaving automations.

Armed with this information you’ll stand a better chance of staying on top of the paperwork and setting yourself up in the best way for handing over to a bookkeeper in the future.

 

What’s involved in small business bookkeeping?

Before we dive in, lets cover off the basics of what bookkeeping is and isn’t. Essentially, it’s the financial record keeping that logs all the money that goes in and out of your business. This includes the collection and storage of key financial items like receipts, invoices and bank statements.

Some bookkeeping tasks are required by law, so it’s important to know what these are (see below) and accuracy is vital to ensure you pay the right amount of tax each year. I would also recommend you complete tasks at least monthly to avoid an overwhelming pile of paperwork just before year end, which can be very stressful.

 

Why bookkeeping is important for your small business

Ok, I realise that the manual recording of all your business financial activity probably isn’t getting you all excited…but hear me out! It’s not just about keeping the taxman happy; these financial records will start to paint a picture of your business’s financial health over time, revealing super useful insights on how your business is doing.

You’ll be able to see what’s going well and what isn’t, and any patterns or issues will become more visible, which can feed into future decision making. You’ll be able to make changes at the right time, when they can still have an impact. It will also prevent you racing ahead with your business ideas blind, without considering the relevance of what’s come before, and hopefully save you from making any bad decisions.

 

Recommended tasks for DIY small business bookkeeping

Record everything!

Keep accurate records as you go along (so you don’t forget anything) and know what to keep and for how long. For example, it’s recommended that receipts are kept for up to 6 years.

Reconcile all your transactions

Reconcile your business bank account on a regular basis and make sure every transaction is accounted for in your bookkeeping records. You’ll thank yourself at year end!

NB. reconciling simply means making sure that the balance in your accounting records matches the balance in your bank account.

Monitor your cashflow

Keep a close eye on this because any problems in this area can stop your business in its tracks. Check regularly what money is available to you and also keep tabs on what you owe to ensure your suppliers can be paid on time. Look 3 months ahead as a bare minimum.

Stay on top of your credit control

Think about your policy on this early on rather than waiting until you have an issue. Using online accounting software can help you manage and automate the sending and chasing of invoices in a timely manner.

Watch out for late payments

Chasing late payments as soon as possible is a no-brainer for your business and is more likely to get an immediate response than trying to follow up months later. Getting to know your longer term customers can also help to build stronger relationships and avoid this situation altogether.

Pay your taxes

Know which kinds of tax appy to you as there are various types, and they have different rules and processes associated with them.

Individuals operating as sole traders and landlords, and those in partnerships will pay income tax and usually National Insurance, whereas limited companies pay corporation tax. Directors of limited companies might pay income tax, National Insurance and dividend tax.

If your annual turnover exceeds the VAT threshold in a rolling 12-month period (currently set at £90k) then you’ll need to register for VAT too.

Any business operating a payroll scheme is likely to have regular payments to HMRC for PAYE and NI.

Important deadlines

Always know your deadlines and build the work needed to meet them into your regular schedule. It can be helpful to sign up for HMRC updates so you get email reminders, and they also offer a wide variety of webinars that explain what you need to do and how.

 

Top tips for doing your own bookkeeping

These are my top tips to help you get started on the right track with your DIY bookkeeping journey:

• Choose an accounting method (traditional or cash) and stick to it
• Have a separate business bank account to keep things simple and save time
• Set aside enough time; little and often is good and makes things manageable
• Digitise everything to reduce the physical paper pile, and ensure data is backed up
• Invoice efficiently to maintain your cashflow and chase late payers promptly
• Check what business expenses can be claimed and what can’t
• Set aside 25-30% of your income for your tax and national insurance bills
• Write down your procedures to save having to remember what you did last time
• Create a checklist of tasks and timelines to keep yourself on track

 

Timesaving automations

Keeping digital records from the outset will help you maintain accuracy more easily and save you hunting for that lost post-it note you scribbled some numbers onto! Adding automations in will take things one step further, speeding up some of the ‘boring’ tasks (very satisfying) and making everything feel much easier.

There are lots of fantastic software packages, tools and apps available now and AI is fuelling the growth of more and more tech. You can automate many data entry tasks, from capturing your expenses and receipts to logging your mileage each time you go out.

It’s also worth looking into digital accounting software sooner rather than later, as Making Tax Digital is rolling out over the next few years, and will extend to all small businesses with an annual turnover of more than £20k. Using digital software will become mandatory and submission of your accounting data will move from once a year to quarterly.

I have a handy blog on MTD FAQs here https://purpleorchidbookkeeping.co.uk/mtd-faqs/

And you can find more info on MTD here: https://www.gov.uk/government/publications/making-tax-digital/overview-of-making-tax-digital

Once you’ve got to grips with the software of your choice you can start enjoying how much quicker it is to reconcile your payments and invoices. Most of the main providers also have knowledge hubs full of valuable advice on many aspects of running a small business, so it’s worth taking advantage of this type of free resource.

It’s important to stress that using automations and software does not guarantee your records will be accurate; you must still understand how to set up and use the software correctly and how to log your records properly. This requires not only understanding how to use the software, but how bookkeeping works too. Remember RIRO – rubbish in, rubbish out!

 

Useful resources for small businesses

I can’t stress enough the importance of being mindful about where you seek out advice for your business. Whilst it can be tempting to rely on friends and family to help, if they don’t have any relevant expertise or experience in what you’re doing, then it could be more harmful than helpful.

There are heaps of amazing online resources but if you do get busy Googling (other search engines are available) what you want to know, try and look for official sources of information like the UK government website or specific small business focused organisations.

Here’s a shortlist to get you started:

UK Government website https://www.gov.uk/browse/business/setting-up

Federation of Small Businesses https://www.fsb.org.uk/knowledge.html

Enterprise Nation https://www.enterprisenation.com/

Chambers of Commerce https://www.britishchambers.org.uk/

 

Signs that you might need a bookkeeper

If you’ve given DIY bookkeeping a good go and you’re still struggling, or you’re feeling fed up with trying to keep on top of everything then it might be time to investigate hiring a bookkeeper.

Here are some of the classic red flags to look out for that signal you’d benefit from a bookkeeper:

• You’re struggling to stay on top of invoicing and payments every month
• Cashflow is a critical factor for your business
• You don’t get time to reconcile spending against your bank account
• Your business generates a lot of transactions every month
• Your record-keeping is now spread across multiple excel spreadsheets
• Your expense receipts don’t make it out of your car (I see you!)
• You’re VAT registered, or will be soon
• You need to start hiring staff and will need to set up a payroll
• Preparation for your year-end tax return starts one day before the deadline
• You’ve tried to do it all yourself, and have got into a bit of a mess

 

Working with Purple Orchid Bookkeeping

Over the years I’ve gathered a lot of valuable insight into what it takes to run a successful business, both from my own point of view and my clients’. This knowledge enables me to not just show you the numbers, but also make recommendations, offer advice and guide you on your business journey.

I take time to explain things in a simple way (no jargon allowed here) and I’m licensed and regulated by the Institute of Certified Bookkeepers, so you know you’re in safe, experienced hands.

When you find the right bookkeeper, they can become an integral part of your business. Leveraging their expertise and getting maximum value from the relationship leads to better financial management and strategic decision-making, which is always going to be a good thing for your business!

If you’d like to find out more about working with a bookkeeper, I’m always happy to have a chat with no obligation!

 

Book a free call today and get some clarity about what might help you move your business forward: https://calendly.com/jq_bookkeeping/clarity-call

 

Updated October 2025