business finances

The tax landscape is changing, and if you’re self-employed or a landlord, you need to be prepared. Making Tax Digital for Income Tax (MTD IT) is approaching, and we’re here to break down everything you need to know about this significant change to tax reporting.

What’s Changing and When?

From April 2026, MTD IT becomes mandatory for self-employed individuals and landlords with annual business or property income over £50,000. Those earning between £30,000 and £50,000 will follow suit from April 2027. This represents the biggest transformation in how we handle tax reporting in generations.

Key Changes at a Glance:

– Quarterly digital updates replace annual tax returns
– Mandatory digital record-keeping
– Compatible software requirement
– New penalty system for late submissions
– End-of-period statements and final declarations

Who Needs to Comply?

You’ll need to follow MTD IT rules if you’re:
– Self-employed with income above £50,000 (from April 2026)
– A landlord with property income above £50,000 (from April 2026)
– Earning between £30,000-£50,000 from self-employment or property (from April 2027)

However, some businesses are exempt, including:

– Trusts
– Estates
– Trustees of registered pension schemes
– Non-resident companies

Digital Record-Keeping: What Does It Mean?

Under MTD IT, you’ll need to:

– Keep records digitally
– Use MTD-compatible software
– Submit quarterly updates to HMRC
– Complete an end-of-period statement
– Submit a final declaration

The Quarterly Reporting Calendar

Your reporting schedule will follow this pattern:

– Q1: April 6 – July 5 (Submit by August 5)
– Q2: July 6 – October 5 (Submit by November 5)
– Q3: October 6 – January 5 (Submit by February 5)
– Q4: January 6 – April 5 (Submit by May 5)

Plus an annual End of Period Statement and Final Declaration by January 31 following the tax year.

Software Solutions: What You Need to Know

Your chosen software must be:

– MTD-compatible
– Able to maintain digital records
– Capable of sending information directly to HMRC
– Secure and reliable

Many popular accounting software providers are already developing MTD IT-ready solutions. While spreadsheets can still be used, they’ll need to be paired with bridging software to be compliant.

Preparing for the Change

Start your MTD IT journey now by:

1. Assessing your current record-keeping methods
2. Calculating your annual income to determine your start date
3. Researching MTD-compatible software options
4. Planning your transition timeline
5. Considering professional support for the switch

Common Concerns Addressed

“Will this mean more work?”
Initially, there may be an adjustment period, but digital record-keeping often proves more efficient in the long run. Real-time tracking can actually save time and reduce year-end stress.

“What about the costs?”
While there may be software costs, digital systems often lead to better financial visibility and potential cost savings through improved record-keeping and tax planning.

“Can I get help with the transition?”
Yes! At Halo Bookkeeping we are here to support your journey to MTD IT compliance.

The Benefits of Going Digital

Despite the initial changes required, MTD IT offers several advantages:

– Real-time view of tax obligations
– Reduced risk of errors
– Better financial insights
– More efficient record-keeping
– Improved cash flow management

Next Steps

1. Review your current income levels
2. Mark key dates in your calendar
3. Explore software options
4. Consider professional support
5. Start digital record-keeping before the deadline

Need Help?

The transition to MTD IT doesn’t have to be overwhelming. Professional support can make the journey smoother and ensure you’re fully compliant when the time comes.

Want to ensure you’re fully prepared for MTD IT? Book a consultation with us today to discuss your specific needs and create a personalised transition plan.

This information is current as of April 2025. While every effort has been made to ensure accuracy, this article should not be relied upon as professional advice. Please consult with us for guidance specific to your situation.

Book a call

SEO Focus keyphrase: how to choose a bookkeeper

Choosing a bookkeeper is one of the most important decisions you’ll make as a business owner. The right person will save you hours of stress and help you understand your numbers. The wrong one? They’ll cost you time, money, and peace of mind.

If you’re wondering how to choose the right bookkeeper for your business, read on. In this article, we’ll break it down step-by-step so you know what to look for in a great bookkeeper and where to look.

1. Know what you need help with

Before you can choose a bookkeeper, you’ve got to know what you need from them. Bookkeeping isn’t just data entry, it covers everything from bank reconciliation and invoicing to budgeting and forecasting.

Ask yourself:

Do I just need someone to keep the records tidy?
Or do I want strategic support with financial planning?
If I had a financial expert at hand in my business, what would I ask them?

Make a list of the tasks you want to hand over, and then think about what you’d really like to know from a financial expert in your business. This will help you choose the right bookkeeper.

2. Choose someone with the right skills and expertise

It’s not all about qualifications. A great bookkeeper combines skills, experience, and expertise. Your bookkeeper is likely to be a business owner themselves, so as well as being able to do a great job of the bookkeeping, they’ll also be able to talk strategically with you about the financial aspects of running your business.

Look for someone who:

Is qualified with a reputable professional body
Is licensed and insured – a licensed bookkeeper needs to follow strict procedures for Anti Money Laundering Regulations and will have professional indemnity insurance
Understands your accounting software
Communicates clearly and regularly
Can explain financial terms in plain English
Thinks ahead and brings you solutions

You want someone who’s more than a number-cruncher, your bookkeeper will see every financial working in your business, why not choose a great bookkeeper who will become a trusted advisor for your business?

3. Use the 6FB Directory to find trusted bookkeepers

Not sure where to start your search? Head over to the 6 Figure Bookkeeper Directory.

It’s packed with bookkeepers who have a mark of quality – every one of them invests in their professional development through The Bookkeepers’ Collective. That means they’re committed to modern practices, ethical standards, and business growth.

You can search by location or specialism, which is ideal if you need someone local or with experience in your industry.

4. Ask the right questions before you hire

It’s tempting to ask, “How much do you charge?” – but there are more revealing questions to ask first.

Try these:

“Do you work with other clients in this industry?”
“How regularly will you be in touch with me?”
“Can you walk me through how you’d handle catch-up work?”
“Are there any opportunities to automate or streamline any of the bookkeeping processes we have at the moment?”
“How do you keep up with changes in the industry?”

The right bookkeeper will be able to answer with confidence, and may even raise things you haven’t thought about.

5. Pick someone who keeps learning

The bookkeeping industry changes fast. Regulations shift, software evolves, and best practices move on. Professional bookkeepers are obliged to complete ongoing professional development and as a business owner, you benefit when they do, so make sure you choose somebody who stays up to date.

Bookkeepers who are part of The Bookkeepers’ Collective are continuously upskilling. The community gives them access to CPD training, expert Q&As, and coaching.

That means they’re not just keeping up, they’re often ahead of the curve – and learning things that will enhance your business too.

6. Check reviews and reputation

When you’re choosing a bookkeeper, trust your gut – but back it up with facts.

Check:

Great bookkeepers are proud of the work they do.

7. Don’t Just Go for the Cheapest

Choosing the cheapest bookkeeper can cost you more in the long run.

Just like you’d choose the mechanic you trust over the cheapest mechanic, Bookkeepers who charge more often provide more value. They can streamline your processes, help you plan ahead, and free up your time to grow your business.

So if a quote seems high, ask what’s included. You might be surprised by the return you’ll get.

Conclusion: How to Choose a Bookkeeper You Can Rely On

Choosing a bookkeeper doesn’t have to be a gamble. Take the time to understand what you need, ask the right questions, and choose someone who’s committed to their own development as well as your business’s.

Need a shortcut? The 6FB Find a Bookkeeper Directory is full of trusted professionals who are serious about doing things right.

When you work with a great bookkeeper, you’re building a foundation for business growth. Choose wisely.

If you like what you see on our website and you think we’re the right fit then please reach out!

Book a call

Running a business is exciting, but let’s be honest – keeping track of your finances can feel overwhelming. Don’t worry! You don’t need to be a math genius to understand the important numbers in your business. Let’s break down the key figures that can help your business thrive.

Show Me the Money: Cash Flow Basics

Think of cash flow like your business’s bank account – what’s coming in versus what’s going out. It’s simple: if you have more money coming in than going out, that’s positive cash flow (yay!). But here’s the important part: even profitable businesses can struggle if they don’t have enough cash available at the right time. That’s why checking your cash flow regularly is crucial – it helps you spot potential tight spots before they become problems.

Getting Paid On Time: Your Secret Weapon

Here’s a common headache: you’ve done the work, sent the invoices, but the money isn’t coming in fast enough. We call these ‘debtor days’ – the time it takes for customers to pay you. The longer it takes to get paid, the harder it is to pay your own bills and keep your business running smoothly. A good bookkeeper can help you set up effective systems to get paid faster, like automated reminders and clear payment terms.

Profit: The Real Story

Everyone talks about profit, but what really matters is your profit margin – how much you keep from each pound you earn. For example, if you make £100 from a sale and get to keep £20 after all your costs, that’s a 20% profit margin. Different industries have different typical profit margins, and a bookkeeper, like us, can help you understand if you’re on track compared to similar businesses.

Making Your Numbers Work for You

The best part? You don’t need to track everything. Start with these basics:

• Weekly: Check your cash flow

• Monthly: Review how quickly you’re getting paid

• Quarterly: Look at your profit margins

Small Changes, Big Impact

Sometimes, small tweaks can make a huge difference. Maybe you notice customers are taking longer to pay, or your profit margins are down (because your costs are creeping up). Spotting these trends early means you can take action before they become problems.

Need Help Making Sense of Your Numbers?

At HB Accountancy, we’re experts at making business finances less scary and more useful. We help business owners just like you understand their numbers in plain English – no accounting degree required.

Ready to take control of your business finances? Let’s chat about how we can help you make smarter money decisions for your business.

Book a call

I don’t know about you, but I’m really looking forward to spring! More sunshine, longer brighter days and more colour! Spring is the perfect time to refresh not just your home, but your finances too. A financial spring clean can set you up for success and peace of mind for the rest of the year. Here’s how to get started:

The Importance of a Financial Spring Clean

Spring is filled with renewal, making it the ideal time to tidy up your financial records. By organising your finances, you can make informed decisions, reduce stress, and set a solid foundation for growth. Plus, a clean financial slate can help you spot opportunities and challenges early on.

Steps to Spring Clean Your Bookkeeping

1. Organise Your Documents

Start by gathering all your financial documents. Sort them into categories like income, expenses, taxes, and investments. Consider going digital to reduce clutter and improve accessibility. If you’re already digital, look at ways of introducing integrations and automations to keep things tidier.

2. Review Your Records

Take a close look at your financial records. Are there any discrepancies or outdated information? Correct any errors and ensure everything is up-to-date. We strongly recommend keeping on top of your bookkeeping each week. If each week is out of the questions then at least every month. This way any discrepancies can be spotted and rectified before any accounts submissions or tax filings. The longer problems get left the more problematic they become.

3. Leverage Technology

At Halo Bookkeeping we use Client Engager, Xero, Dext and Apron to streamline your bookkeeping processes. By leveraging the technology we have access to we can ensure all your systems are talking to one another so there’s less need for manual intervention. The use of automation for the less tricky tasks means you have more time to concentrate on what you do best, bringing in those sales!

4. Schedule Regular Check-Ins

Set aside time each month to review your finances. Regular check-ins help you stay on top of your financial situation and make adjustments as needed. Our Management Accounts service ensures that you’re staying in the loop when it comes to your financial position. You just don’t know your numbers, you fully understand them as they are fully explained to you. We can then take appropriate action each month to ensure your business is heading in the right direction

Setting Financial Goals for the Year

With your finances in order, it’s time to set some goals. Whether it’s saving for a big purchase, reducing debt, or increasing revenue, make sure your goals are specific, measurable, and aligned with your personal and business objectives.

Embracing New Financial Habits

After your spring clean be sure to make all of this a new habit and stick to it. It’s no use spring cleaning your finances if you’re going to be back in the same position this time next month. Let’s change your financial habits for the better, together.

Book a call

We’re in the second month of a new year and January went past in the blink of an eye. I’m not sure about you but I feel like my feet haven’t touched the ground! When you’re busy in business life moves so fast and for that reason, it’s crucial to leverage the tools and resources you have in order to achieve more in less time.

Do you find yourself juggling multiple tasks, leaving little time to focus on growth? The good news? Hiring a bookkeeper can make a world of difference and here’s why!

Embrace Software Solutions

At Halo Bookkeeping we use Xero to streamline your bookkeeping process. This also has a knock on effect with other software you use across your business as it integrates with so many different apps.

We use Practice Management tools such as Client Engager. This ensures that all the information we need is stored in one place and we can delegate tasks to various team members to ensure a seamless workflow. By integrating these tools into your daily operations, you can ensure that your business runs smoothly and efficiently.

Automate Routine Tasks

Automation is a game-changer for businesses looking to streamline their processes. Tasks like invoicing, payroll, and data entry can be automated using tools like Xero, Zapier and Dext allowing you to focus on more strategic activities. Automation not only speeds up processes but also ensures consistency and accuracy, freeing up your time and ours to concentrate on more complex challenges.

The Power of Hiring a Bookkeeper

While technology can handle many tasks, the expertise of a bookkeeper is invaluable. We can provide insights into your financial health, help you make informed decisions, and ensure compliance with regulations. By outsourcing your bookkeeping, you can free up time to concentrate on growing your business, knowing that your finances are in capable hands.

Combining Technology and Human Expertise

The true magic happens when technology and human expertise come together. By leveraging software and automation alongside the skills of a bookkeeper, you create a powerful synergy that enhances productivity and efficiency. This combination allows you to focus on what you do best while ensuring that your business operates at peak performance.

Streamlining your processes with software, automation, and a bookkeeper can transform the way you work, promoting efficiency and productivity.

Ready to take the next step? Let’s explore different ways we can work together to make 2025 much more productive and efficient.