Profit
Broadly, income earned less relevant business costs for the period, subject to accounting and tax rules.
Bookkeeping services in West London
Know where the business stands before the year end.
SV&Co provides bookkeeping and cloud accounting support for sole traders, limited companies and growing SMEs across Southall, Ealing, Hayes, Wembley and wider West London.
Good bookkeeping should answer these questions
Can you see these four things without waiting for the accountant?
How much profit are we making?Not simply how much cash is in the bank.
What do customers owe us?See unpaid sales and money that should be collected.
What tax is building up?VAT, PAYE or other liabilities should not come as a surprise.
Are the records actually complete?Bank balances, invoices and expenses should reconcile.
If the answer to these questions is “not sure”, the bookkeeping system is not giving you enough information.
Business records
Good bookkeeping begins with complete source records.
A tax return or set of accounts is only as reliable as the information underneath it.
For sole traders and partnerships
- Sales and other business income.
- Business expenses.
- VAT records if VAT registered.
- PAYE records if you employ people.
- Supporting invoices, receipts and bank records.
- Other information needed for the Self Assessment return.
HMRC record retention
Self-employed records normally need to be kept for at least 5 years after the 31 January filing deadline for the relevant tax year.
For limited companies
- Money received and spent by the company.
- Details of company assets.
- Debts the company owes or is owed.
- Stock information where relevant.
- Records used to prepare annual accounts and the Company Tax Return.
- Supporting invoices, contracts and bank information.
HMRC record retention
GOV.UK says company accounting records generally need to be kept for 6 years from the end of the last company financial year they relate to, with some situations requiring longer.
A better bookkeeping rhythm
Do the work while the transactions still make sense.
For most active businesses, regular bookkeeping is more useful than waiting until the year end. The right frequency depends on transaction volume, VAT, payroll and how often you need management information.
Capture
Collect sales invoices, supplier bills, receipts and digital documents.
Record and reconcile
Post transactions and match the accounting records to bank and card statements.
Review
Check unusual transactions, missing records, VAT treatment and balances that do not make sense.
Report
Use the cleaned records for VAT, tax, management accounts and business decisions.
Profit and cash
A healthy bank balance does not automatically mean a healthy profit.
One of the biggest benefits of good bookkeeping is separating what is happening in the bank from what the business has actually earned.
Cash
The money currently available in the bank. It can be affected by loans, asset purchases, tax payments and timing differences.
Money owed to you
Sales can increase profit before the customer has actually paid the invoice.
Money you owe
Supplier bills, VAT, PAYE and other liabilities may need paying even though the cash is still in the bank today.
Owner transactions
Drawings, director’s loans, capital introduced and dividends can move cash without being ordinary business expenses.
Equipment and finance
Buying an asset or borrowing money can change the bank balance differently from the profit shown in the accounts.
Choose the right software
The cheapest accounting software can become expensive if it creates more manual work.
Businesses sometimes use software that does not fit the way they actually operate, or they pay for a capable system but use only a small part of what it can do. The result can be duplicate data entry, missed expenses, weak reporting and unnecessary year-end clean-up.
We want the accounting system to fit the business, not force the business to fit the software.
The right system depends on how you trade. A simple consultant may need excellent invoicing, bank feeds and expense capture. A retailer may need reliable links with point-of-sale and stock systems. A construction business may need CIS processes. A growing company may need payroll, purchase approvals, management reporting and better control over who can do what.
We therefore look at the whole workflow, not simply the software name.
Our view
It is often better to pay a sensible monthly software cost and save hours of administration, missing paperwork and corrective work than choose the lowest-cost system and repeatedly pay for manual fixes.
But software only creates value when it is set up and used properly.
Bank feeds, document capture, invoice workflows, rules, reporting and integrations can be wasted if nobody configures them around the business or reviews the exceptions.
Capture once
Collect invoices, receipts and bank information at source.
Automate repeatable work
Reduce re-keying, matching and routine administration.
Review exceptions
Use human judgement where the treatment is unusual or tax-sensitive.
Use the information
Turn clean records into VAT, accounts, tax and management reporting.
MTD point.
Using accounting software does not automatically make a business MTD compliant. Where MTD applies, the business needs compatible software and the required digital record-keeping and submission process. HMRC provides software finders for MTD for VAT and MTD for Income Tax.
Interactive Bookkeeping Health Check
Is your bookkeeping actually under control?
Answer eight simple questions. This is not an audit, but it can show whether the current process is providing reliable information.
Bookkeeping FAQs
Quick answers before you contact us.
What is the difference between bookkeeping and accounting?
Bookkeeping records and checks the underlying transactions. Accounting uses those records to prepare financial statements, tax calculations, management information and professional advice. Good accounting depends on good bookkeeping.
Do I need bookkeeping every month?
Not every business needs the same frequency. Monthly bookkeeping is often appropriate for active businesses, VAT-registered businesses or businesses needing regular information. Smaller businesses may need a different rhythm.
Can I do the bookkeeping myself?
Yes. The important issue is whether the records remain complete, accurate and usable. Some clients keep part of the process themselves and ask SV&Co to review or complete the technical areas.
Can software replace a bookkeeper or accountant?
Software can automate data entry, matching and repeatable processes. It does not remove the need to investigate errors, apply VAT and tax rules, review unusual transactions or use professional judgement.
How long should I keep my records?
The period depends on the type of taxpayer and record. HMRC says self-employed records normally need to be retained for at least 5 years after the 31 January filing deadline for the relevant tax year. Company and VAT records can have different retention periods.
Can you take over messy or incomplete bookkeeping?
Yes. We would first establish the current position, reconcile the records, identify missing information and prioritise any VAT, accounts or tax deadlines.
Reviewed by
Sandip Vadher, PhD FCCA
Founder of SV&Co Accountancy. Fellow Chartered Certified Accountant with more than 20 years of finance and accountancy experience.
Improve the bookkeeping process
Tell us what is not working today.
Messy records, too much manual work, VAT deadlines, poor reporting or simply no time to keep the books up to date.
Accurate bookkeeping supports VAT returns, annual accounts, tax planning and useful management information. SV&Co helps West London businesses keep records current and turn them into practical financial information.