Heads Up – Accounting Standards for Sole Traders Change

HMRC is introducing simplified accounting requirements for sole traders under the VAT threshold (£77k) from April 2013.

For sole traders in this situation the reporting requirements are reduced to three lines:

  • Total Income
  • Less Total Allowable Expenses
  • Net Profit


In addition each line is calculated on a cash basis – ie money in and money out, rather than the standard invoice basis that counts income once it has been invoiced (whether or not payment has been received) and purchases once a bill has been received.

For Crunchers clients we will be reviewing the service we currently provide to see if they want to take advantage of this simplification and amend our fees accordingly.

For anyone who is not one of our clients we recommend to raise this with your accountant.

Read HMRC Guidance

1 thought on “Heads Up – Accounting Standards for Sole Traders Change”

  1. Have you ever considered writing an e-book or guest authoring
    on other blogs? I have a blog centered on the same topics you discuss and would really like to have
    you share some stories/information. I know my readers would appreciate your work.
    If you’re even remotely interested, feel free to shoot me an email.

Comments are closed.