As a Sole Trader you will need to keep up-to-date books showing your businesses financial position. These can be inspected by HMRC through their usual investigation checks but they are usually kept just to prepare the end of year trading accounts.
We recommend you keep your books up-to-date monthly, this ensures that you have all the information needed fresh in your mind. It also helps you to understand how your freelancing is progressing and if you need to make any changes, what these changes should be.
The 123 Way includes bookkeeping software which is based in Microsoft Excel - it's easy to use and gives you lots of important information on what you tax liability will be along with what your main expenses are so you can look to cut costs.
Records i.e. all of your sales invoices and expense receipts need to be kept for a minimum of 7 years. There are fines and penalties in place if you destroy your records before this time.
This information is for general information only. We take no responsibility for any action taken or refrained from in consequence of its contents. Always seek our professional advice specific to your circumstances before acting.