Bookkeeping probably isn’t the most exciting part of running a business… but it is one of the most important. And now that we’re heading into the end of 2025, the first full year of Making Tax Digital (MTD) for Income Tax Self-Assessment being properly in force for most self-employed people, staying on top of your records has never mattered more.
The good news? Staying organised doesn’t need to be stressful. With the right habits (and the right tools like Coconut), you can keep everything tidy, tax-ready and far less time-consuming.
Here’s how to stay in control of your bookkeeping as we wrap up 2025.
1. Treat bookkeeping like a weekly habit, not a yearly chore
We’ve all been there: the end of January creeping closer, a bulging folder of receipts and the sinking realisation that you left everything to the last minute again.
With MTD, that’s no longer an option, quarterly updates mean you have to keep things moving throughout the year.
Use December to set up a simple weekly routine you can actually stick to. For example:
- Spend 15–20 minutes every Friday updating your transactions
- Check you’ve categorised everything correctly
- Snap photos of any paper receipts straight away
Small, regular check-ins stop everything building up and make tax time far less painful.
2. Go fully digital
With MTD now the norm, having digital records isn’t just “nice to have”, it’s required. But beyond the rules, digital bookkeeping just makes life easier.
If you’re still juggling spreadsheets, switching between tabs or digging through old emails for receipts, it’s time to simplify.
Tools like Coconut bring everything together:
- Categorise income and expenses
- Match receipts quickly
- Track business and personal transactions separately
- Prepare for quarterly MTD submissions
Most importantly, it saves you hours. December is the perfect time to move your records over while things are quieter.
3. Use real-time insight to stay on top of tax
One of the biggest stresses for sole traders is not knowing how much tax to put aside. With MTD, HMRC wants more regular updates which means you need a clearer picture throughout the year.
Real-time bookkeeping tools automatically estimate what you owe based on your actual income and expenses. No more guesswork, no more nasty surprises in January.
If you’re wrapping up your books for 2025, make it your goal to:
- Keep everything updated weekly
- Check your tax estimate monthly
- Put money aside into a separate account
Future you will be grateful!
4. Make it easy to separate business and personal spending
Mixing business and personal transactions is one of the biggest causes of messy bookkeeping. You can separate it all later, but it’s fiddly, time-consuming and very easy to get wrong.
If you haven’t done this yet, make December the month you:
- Use a dedicated business account or card
- Categorise your expenses as you go
- Use an app that lets you split transactions if something is partly personal
A clear separation keeps your records cleaner and speeds up your MTD submissions.
5. Get help when you need it
Even if you’re doing your own bookkeeping, you don’t have to go it alone. Whether it’s checking you’re compliant with MTD, sorting a messy spreadsheet or planning for the new tax year, an accountant can offer a lot more value than just filing your return.
Many accountants now use tools like Coconut to collaborate with clients, making it easier for you to share records and for them to keep everything up to date.
6. Use December as your clean-up month
Before you switch off for Christmas, use a quiet afternoon to do a quick “end of year tidy-up”:
- Make sure everything is categorised correctly
- Upload any missing receipts
- Check your income and expenses are complete for the year
- Review your tax estimate
- Export copies for your own records
This clean slate makes January and your first MTD submission of 2026 much smoother.
Bookkeeping has changed a lot in the past few years and with MTD fully active for most self-employed people, keeping your records tidy is no longer just good practice, it’s essential.
But with a few simple habits and the right digital tools, staying on top of everything doesn’t need to be stressful. Start small, stay consistent and let technology do the heavy lifting.
You can find out more about Coconut here.
