How Can I Manage Documents to Make Tax Returns Easier?

Tax deadlines have a nasty habit of suddenly looming up and asking where all your receipts are. It can be quite stressful, so in this article we share our favourite tips for staying on top of your tax records. Spoiler alert: we make online accounting software so that’s going to get a mention.

Automate repetitive bookkeeping tasks

Some things, like a nice cup of tea and a biscuit, are worth your time and attention. But some things are just a big unneccessary pain in the bum, and can be dealt with differently. Manual or repetitive processes in your bookkeeping are a good example.

Do you find yourself sending the same invoices out every month, but changing the dates and reference numbers? Set up recurring transactions. Laboriously copying information from the bank and entering it into your records? Set up a bank feed to connect your accounting software to your bank account. Don’t actually have accounting software? Well that’s an excellent place to start.

Be consistent

If you have bad habits when it comes to sorting out your tax paperwork, you’re not alone. It’s never too late to change.

Schedule a regular slot for gathering documents and updating all your records. Better yet, refer to our point above about automating more of these tasks, so you don’t need to schedule quite so much time. For example, a bank feed will create bookkeeping entries each time there’s a new transaction in your bank. You can snap the corresponding receipt on your phone, and upload it to the transaction record there and then.

Be really consistent

Being consistent will also make sure you process everything in the same way. For instance, by recording that recurring order for toilet rolls to the same category each time. Standardising the way you collect and record data makes the process more effortless, and reduces the risk of weird anomalies. And yes we had to correct that from ‘animals’.

The types of documents you need for your tax return

If you’re overwhelmed, or it’s your first time acquainting yourself with HMRC, you might not even know where to begin. So let’s review some of the key documents you’re going to need to get on top of.

Receipts

You know those little paper dockets that live at the bottom of your bag? Sometimes they’re stuffed in a pocket, or make it into the footwell of your car. Either way, it’s high-time you gather them up ready for your tax return.

Staying organised with receipts is no simple feat. We’re all prone to crumpling them up and putting them somewhere safe, only to become a problem for future you. (Although we did mention taking photographs…).

Invoices

Invoices are another record that’s essential for tax returns, yet easy to lose track of. Create a template. Print it out. Post it. Mark it as paid. File it away. It’s enough to drive even the most meticulous of us mad.

Invoices sometimes need to be kept for years. It can lead to reams of paper being stuffed in to cabinets, all taking up precious space.

You might use email to send invoices, or accounting software to issue digital invoices with a few clicks. It’s hard to measure the cathartic joy of having all your invoices automatically organised into a digital system for you, but we promise, it’s pretty miraculous.

Each invoice will be automatically recorded into your bookkeeping, and you’ll also get the satisfaction of being more environmentally friendly.

Other information for tax returns

As well as keeping records of transactions and the paperwork which backs them up, you might also need other key information. The exact requirements will depend on what type of tax return you’re submitting, such as a Self Assessment, or VAT return.

Making Tax Digital

It goes without saying that it’s better to be on top of your record keeping at all times. Even more so as HMRC continues moving towards digital accounting and Making Tax Digital. You’ll need to keep digital records, and use approved software to submit summaries to HMRC on a quarterly basis, so it’s well worth getting the hang of things now!

Learn more about using Pandle to make business accounting easier. Create an account today and decide what to do with all the extra time you get back.