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Guide to bookkeeping and tax for start-ups and small businesses

If you’re a start-up or a small business, then bookkeeping and tax are fundamental to how well your enterprise runs.

Bookkeeping might not be at the top of your list or priorities, but it provides the basis for managing your finances properly, and lays the foundations for future growth.

Here are the things about small business bookkeeping and tax you need to know.

What Your Small Business Tax Accountant Should Tell You

You need to keep up to date and accurate details of your income and expenses. This isn’t just a legal requirement, it’s also vital for managing your business effectively.

The bookkeeping records you keep will be the basis of the statutory financial statements you must submit as records:

  • If you operate as a limited company, you will need to submit your record to Companies House
  • If you are self-employed, you will need your accounts to calculate your self assessment tax return.

Is bookkeeping complicated? It might seem daunting at first, but if you take systematic, step-by-step approach, it is much easier to manage.

What Does Basic Bookkeeping Involve?

You can breakdown small business bookkeeping into daily, weekly, monthly, quarterly and annual tasks. These categories make it more manageable, and provide a systematic approach to your accounting.


Check your business’s cash position, and that you have enough cash to cover your outgoings.

Cashflow is the lifeblood of your enterprise, enabling you to pay for the things that make your business run, such as stock, rent and employee salaries.

It can come from a variety of sources, such as payments from customers, loans, and money from investors.


Weekly tasks are something you should have built-in to your bookkeeping system, and include:

  • Prepare and send invoices – doing this regularly helps ensure you have regular cash-flow for your business
  • Pay suppliers – review payment due dates on invoices you have yet to pay and make payments so that you do not incur any late payment penalties
  • File receipts and documents – make sure you have copies of all invoices you send, and receipts for any payments you make
  • Record your transactions – keep a record of every transaction you make, using specialist software or spreadsheets, including receipts and invoices
  • Review cash-flow.


Monthly bookkeeping tasks should cover:

  • Run payroll and make payments to HMRC – these will apply if you have staff, where you must report your employees’ payments and deductions, and pay HMRC accordingly
  • Make VAT payments – if you are VAT registered, you make these advance payments each month
  • Check your bank statements – make sure there are no omissions or inaccuracies, and check for signs of fraud
  • Review incoming payments – keep on top of any late payments you will need to collect
  • Review outgoing payments – make sure you are up to date with your payments due
  • Review monthly turnover and profit – check how your performance compares with preceding months, to see if you have business growth.


Make your advance VAT payments if you have arranged to do this on a quarterly basis.


You must do your annual accounts if you are a limited company. You must file these each year with Companies House, within nine months of your accounting reference date. This date either the day after your previous accounting year has ended, or your incorporation date, if you are a new company.

For a turnover less than £6.5 million, you can file abbreviated accounts, which just include a balance sheet and notes.

But for HMRC and shareholders, you will need make sure you have full statutory accounts.

For filing your company tax return and paying corporation tax, your accounting period determines your deadline.

If you’re a sole trader then you do not need to file annual accounts, but you will need to complete your self-assessment tax return at the end of your financial year.

Your bookkeeping records should supply the necessary information for this return. What you must then pay in income tax and national insurance will then be based on the information in your return.

Small Business Bookkeeping Advice

There are key aspects of bookkeeping for start-ups and small businesses that can help you stay on track, and give your business the best possible basis from which to grow.

  • Claim all your legitimate expenses – keep receipts for everything you spend on your business, even small items, because in the end it all adds up
  • Budget for your tax – this might seem obvious, but plenty of people leave it late and find themselves scrambling to raise the necessary money, so put aside 25% to 30% of your income to pay for your tax bills
  • Get FREE advice from HMRC – there’s plenty of guidance and support for you to access, including free videos and webinars, plus email alerts.
  • Take advantage of accounting software – there is a range of specialist packages that can make bookkeeping and managing your accounts simpler and more streamlined.

DIY or Outsource Your Bookkeeping?

You might feel that early on, if your accounts are relatively simple, then a DIY approach to bookkeeping will work for you.

But you should weigh up the time it will take you to stay on top of this against the cost of getting specialist help and support.

Plus, using a small business accountant offers plenty of added value, as they will have a huge depth of knowledge and insight that can provide you with long-term strategic benefits.

To enquire about our online bookkeeping services for small businesses and start-ups, give the team at Venn Accounts a call on 020 8088 2590, email enquiries@venn.dawncreativehosting.co.uk or fill in our contact form, and we’ll be in touch as soon as possible.

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Operating from our London head office, Venn Accounts a traditional accounting firm. We are committed to ensuring all our clients are completely clear about what we can do for them, while fully supporting them every step of the way.

Contact us and speak to a member of our team about our annual account service.