Opening entry
A plain set of books for the one-person business
Fox Ledger explains bookkeeping for UK sole traders and very small firms: what to keep, what to put on an invoice, what you can claim and when HMRC wants to hear from you. Each entry below starts with the answer, cites GOV.UK, and says which tax year its figures belong to.
This is general education from an independent publication. Where your own position needs a professional, we say so.
Entries to date
| Posted | Folio | Particulars | Dr. it asks of you | Cr. it gives back |
|---|---|---|---|---|
| Fo. 6 | Do I need Making Tax Digital for Income Tax?Thresholds, quarterly dates and the question everyone asks: no, you do not pay tax each quarter. | Four updates a year once you join | Payment dates stay the same | |
| Fo. 5 | When is Self Assessment due, and what is the first bill?The calendar for the 2025 to 2026 return, followed by a worked first bill showing what payments on account do to the total. | 31 January 2027 for return and tax | No £100 late filing penalty | |
| Fo. 4 | Cash basis or traditional accounting?Two questions that are often confused: when an item counts, and how it gets written down. | One choice, or staying on the default | No tax on money not yet received | |
| Fo. 3 | What expenses can a sole trader claim?A sort into two columns, covering the costs that feel like business costs and are not, plus the flat rates for 2026 to 2027. | Every cost sorted, mixed use split | Less profit left to tax | |
| Fo. 2 | What must a UK invoice include?Nine required items, one sample invoice, and the rules that decide when a business customer has officially paid late. | Nine items on every invoice | A clear date when payment turns late | |
| Fo. 1 | What records must a sole trader keep?The GOV.UK list is short and the retention period is longer than most people assume. Here is what to keep, and a sample page that would do the job. | Proof of every line, kept at least 5 years after 31 January | Answers ready if HMRC asks | |
| Carried forward: 6 entries. Rules stated by tax year in each. | ||||
Dates carried forward
| Date | What falls due |
|---|---|
| 31 Jan 2027 | Online return and tax for 2025 to 2026. The calendar |
| 7 Feb 2027 | Third quarterly update, if you are in Making Tax Digital. The questions |
| 6 Apr 2027 | Making Tax Digital starts for qualifying income over £30,000 on the 2025 to 2026 return. |
| 7 May 2027 | Fourth quarterly update for 2026 to 2027. |
| 31 Jul 2027 | Second payment on account, where one applies. |
Taken from GOV.UK, as stated in tax year 2026 to 2027. Check there before you act on a date.
How to read a double entry
| Account | Dr. (£) | Cr. (£) |
|---|---|---|
| Bank: customer pays invoice 0032 | 410.00 | |
| Sales: invoice 0032 | 410.00 | |
| The two sides agree | 410.00 | 410.00 |
You do not have to keep books this way, as our note on methods explains, but our entries borrow the layout. The debit side above shows what each article asks of you, and the credit side shows what you get back.
Know this subject from the inside? Pitch us an entry.