Bookkeeping
What it is
The systematic recording of a company's financial transactions — income, expenses, invoices, bank payments and receipts. Accurate bookkeeping is the foundation for annual accounts, VAT returns, Corporation Tax calculations and payroll.
Why it matters
Poor bookkeeping is the main reason accountants charge more and take longer. Clean monthly records cut annual accounts costs, reduce errors and make deadlines obvious. HMRC also requires businesses to keep records for at least 6 years.
Common mistake
Leaving all bookkeeping until year end. Twelve months of unsorted bank statements take far longer to untangle than records maintained monthly — and the cost to your accountant reflects that.
Official source
GOV.UK — Keeping records for your company ↗Disclaimer
General educational guidance only — not legal, tax, accounting, immigration, investment or financial advice. We don't guarantee the information is complete, current or suitable for your situation. Always check official sources (GOV.UK, Companies House, HMRC, the relevant professional body) and speak to a qualified professional before acting. Last reviewed: June 2026.