I need to do Self Assessment – what records do I need to keep?

A simple guide to common tax problems

Employee and agency workers: keep your payslips and P60s.  If these are electronic, download them from your works portal and store them where you can access them. This could be by printing them and filing them or by storing an electronic copy securely and easily accessible.  If you are claiming tax relief on expenses, keep the records, eg mileage records.

CIS subcontractors: keep the tax certificates from the main contractor.  Also keep a record of any expenses or additional income from work you do on your own account, perhaps at the weekend or in the evenings as this is self-employment income.  

Self-employed workers: keep the business records you need to complete your tax return. If you are self-employed, these are the types of records you need to keep:

  • Business records
    • All sales and income ( eg invoices, till records & bank statements.)
    • All business expenses (eg invoices & mileage records)
    • VAT records if you are VAT registered
  • PAYE records if you have employees
  • Other records   – Records about your personal income, or any additional income you have
  • Your grants, for example if you claimed a Covid-19 support grant through the Self-Employment Income Support Scheme (SEISS)

These records are used to work out your profit or loss for your tax return. You need to make sure your records are accurate to avoid errors.  Most of these records are supplied electronically, you must make sure that you store them such that you can provide them to HMRC if asked.  

Remember –  if some of your invoices include expenses that are personal as well as business you need to adjust for this on your tax return.

Tips for keeping records

You can use spreadsheets or apps or bookkeeping software as well as files, folders or diaries to keep track of paper records.

  • File your invoices in a safe space, preferably in alphabetical and date order
  • Use a separate bank account for your business transactions
  • Keep backups of computer records so important  data is not lost if something happens to your computer
  • Keep all of your receipts in one place, perhaps a file or a box. Some people will staple receipts into a diary so it is easy to keep track of the dates of transaction.
  • Track all income received and keep a track of the people who owe you money and those who you owe money to
  • Set time aside once a week or even once a month to do your bookkeeping so that you stay on top of it and it is not overwhelming