Recording income and costs

In short

• Record every cost and every sale on the same day, with the date, amount, category and evidence number.
• Every line has evidence: an invoice, a till receipt, a bank statement, a receipt note, or at least your own signed note.
• Use fixed categories (a homestead chart of accounts), the same every year, so years can be compared.
• Once a month reconcile cash and the bank account with the book. Once a year, take stock of equipment and stocks.
• What exactly you must keep for tax, grants and selling depends on the country and how you are set up: ask an accountant or the tax authority (HMRC, Revenue, the IRS, the CRA).

What's inside

Chapters

1. Why keep money records
2. What the rules require: the principle
3. The income and cost book
4. Categories: the homestead chart of accounts
5. Evidence and the file
6. Cash and bank
7. Home use and swaps
8. Equipment and depreciation
9. Stocks and livestock at year end
10. Monthly and annual closing
11. Paper, spreadsheet or app
12. Most common mistakes
13. Printable checklist

Worksheets

• Income and cost book
• Homestead chart of accounts
• Depreciation calculator
• Equipment and buildings register
• Year-end stock calculator
• Home-use record
• Record-keeping calendar
• Annual accounts