Sole Trader Bookkeeping Guide | WordPress Accounting

What Records Must a Sole Trader Keep?

As a sole trader, HMRC requires you to keep records of all your business income and expenses. You must keep these records for at least 5 years after the 31 January submission deadline of the relevant tax year.

Your records should include:

All money received — sales invoices, cash receipts, bank statements showing income.

All money spent — purchase invoices, receipts, bank statements showing payments.

VAT records (if VAT-registered) — VAT charged on sales, VAT paid on purchases.

Your personal income — if you have other income sources, these must be declared too.

Getting Started with ComptaFlow UK

Here's how to set up your bookkeeping as a sole trader:

Install the plugin — Download ComptaFlow UK from WordPress.org (free) or get the Pro version from our website.
Configure your business — Go to Settings and enter your business name, UTR number, and VAT scheme (or "Not registered" if below threshold).
Enter your income — Record each sale or payment received. The guided system suggests the right nominal code automatically.
Record your expenses — Enter every business expense with receipt date, amount, and category.
Review weekly — Check your journal entries are correct. The dashboard shows your running totals.
Export at year end — Generate your Profit & Loss and Audit Trail for your Self Assessment.

Guided entry — type a description and the nominal code is suggested automatically

Common Allowable Expenses

As a sole trader, you can deduct legitimate business expenses from your income to reduce your tax bill. Here are the most common categories — all supported by ComptaFlow UK's nominal codes:

🏠 Use of Home Proportion of rent, utilities, broadband for business use

🚗 Vehicle Costs Fuel, insurance, repairs — or use simplified mileage rates (45p/mile)

📱 Phone & Internet Business proportion of phone bills and broadband

💻 Equipment Computers, printers, tools, software — can claim Annual Investment Allowance

📮 Postage & Stationery Paper, envelopes, ink, stamps, packaging

🏦 Bank Charges Business bank account fees, card processing fees

📋 Insurance Professional indemnity, public liability, business contents

📚 Training Courses and training that update existing skills (not new trades)

🧾 Accountancy Fees Cost of your accountant preparing your tax return

📢 Advertising Website costs, business cards, Google Ads, social media promotion

Enter an expense — the nominal code is suggested based on your description

Self Assessment: What You Need

Every year, you must file a Self Assessment tax return with HMRC. The deadline for online filing is 31 January following the end of the tax year (5 April). For the 2025/26 tax year, your deadline is 31 January 2027.

What ComptaFlow UK Provides for Self Assessment

When it's time to file, ComptaFlow UK gives you everything you need:

Profit & Loss report — Your total income and expenses, broken down by category. Transfer these figures directly to your SA103 (self-employment) pages.

Audit Trail — Complete record of every entry, in case HMRC asks for supporting evidence.

Trial Balance — Confirms your books balance correctly before filing.

VAT summary — If VAT-registered, your total VAT collected and paid for the year.

Your dashboard — revenue, expenses, and VAT position at a glance

Should You Hire an Accountant?

ComptaFlow UK is designed as a bookkeeping assistance tool — it helps you keep accurate daily records. For year-end filing, we always recommend working with a qualified accountant or tax adviser, especially if:

You should consider an accountant if:
• Your turnover exceeds £85,000
• You have complex income sources (property, investments)
• You're approaching the VAT threshold
• You need advice on tax planning or business structure
• It's your first Self Assessment

ComptaFlow UK makes your accountant's job easier by providing clean, organised records in standard export formats. Many sole traders find that good bookkeeping throughout the year significantly reduces their accountancy fees.