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Posted Sat, 10 Aug 2024 14:13:11 GMT by J G
Hi, Sorry I'm contacting you because I might be doing a few things wrong and intend to sort it out. I'm self-employed and registered with HMRC as 'sole trader'. I don't earn much with this business, around £6,000 yearly or even less. I wanted to know whether it was legally expected, in this case, to bookkeep, keep records of all the transactions? I'm asking because I might not be doing the right thing : because the amounts I earn are not very high, I don't feel the need to record them in timesheet. What I do when I need to do my tax return is that I just go through my bank statements (and I actually only have one account, which I use for everything, personal and business things...I wonder if this would be an issue, as well, legally?) and note all the amounts... About the invoices, for my services (I write articles)... I suppose it's a legal obligation, even for a sole trader, right? Most of the time, I manage to invoice my clients but I remember that one of them wanted his freelancers, for a time, to fill in in his own form (which doesn't have all the elements indicated here : https://www.gov.uk/invoicing-and-taking-payment-from-customers/invoices-what-they-must-include / actually it was only describing the service and the fee) so that I didn't invoice him properly...and I reckon that in some of my invoices, there's been some mistakes (one or two of them has the wrong date, I've just noticed that and about the 'unique identification numbers', invoices don't always follow each other (actually, are we supposed to start a new count : 'invoice 1, 2, 3..." for each new customer or is it supposed to be one single count from the beginning of our business...so for example : client 1 will have invoices 1, 2, 3 but then if I have another client, he will get invoice 4...etc ?) but the services (title of articles in my case), date of service and fee and name and address of both, myself and the client, are provided...and, most importanly, I'm certain the turnover amount I give to HMRC each year is accurate...but could I be in trouble (possible penalty?) with HMRC for not being perhaps more rigorous with my invoices...and/or bookeeping system if that's a legal obligation? Many thanks
Posted Wed, 21 Aug 2024 08:22:49 GMT by HMRC Admin 25 Response
Hi J G,
Please have a look at the guidance here:
Business records if you're self-employed
It tells you what records you need to keep.
How you keep them is up to you, but you need to ensure that they are accurate.
You can use your persoanl bank account for yoru business, but you will need to be able to separate business and personal transactions.
You will also need to keep your records for at least 5 years after the 31 January submission deadline for the tax year.
Example - If you sent your 2022 to 2023 tax return online by 31 January 2024, you must keep your records until at least the end of January 2029.
Thank you. 

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