“Can you help me with QuickBooks?”
So began The Pilates Teacher’s Tale, when Sadie got in touch for some help with bookkeeping.
By way of background, Sadie is self-employed as a Pilates teacher with annual revenue of just over £20k. She’s been running the business for many years and has two business bank accounts, one for routine receipts and payments and one for savings.
Sadie is diligent about record-keeping for the business and does her own tax return (see below).
Sadie has heard about Making Tax Digital (“MTD”) and has begun to worry about it, to the extent of sleepless nights.
Her friend, also self-employed and with a larger business, has recommended Sadie gets going with proper bookkeeping for her Pilates business.
Sadie has looked at the different accounting software solutions, chosen QuickBooks and, in trying to get started with it, has found herself in a world she doesn’t understand at all.
💡Sadie has asked for help to get her started with her bookkeeping
Anyone running a business, should have separate business bank accounts and ensure that accurate, up to date bookkeeping is taking place so they can understand and improve the financial performance of the business.
Sadie has the two essential building blocks already in place:
Of course, it’s possible to get by with neither and many people do. But separate bank accounts and good bookkeeping have always made a lot of sense and now the heavy hand of MTD is pushing people down this path.
🗝️ the key to good bookkeeping is being organised
Sadie is financially literate.
She’s run the Pilates business for several years and does her own tax returns – she knows her numbers and she knows what the right answer looks like!
But the further she went with her bookkeeping the more confused and frustrated she became.
I’m afraid this is where some of the bookkeeping software providers don’t help – they make bookkeeping sound as easy as riding a bike.
Forgetting to say that an awful lot of people fall off when they’re learning to ride a bike.
Some people just never “get” bookkeeping, it’s simply not for them. The chances are they’ll need to start working with a bookkeeper.
But for most people, with a bit of training they can get a great deal of their bookkeeping done and get it right first time. They might need someone to check in from time to time and make sure everything’s working well but not much more than that.
The Low Incomes Tax Reform Group spell out the software requirements very clearly:
Anyone who is required to use Making Tax Digital will have to use third-party commercial software to allow them to meet the requirements of the new rules. The software will need to be able to:
HMRC are not producing their own software to enable tax payers to keep digital records or file Quarterly Updates and, crucially, HMRC’s existing online filing service for self assessment tax returns will not be available for those within Making Tax Digital when they need to file an end of year tax return.
It turns out we’re not short of so-called MTD software solutions, but we might just be short of good ones.
And it’s not only the software that has to work – the first round of Quarterly Updates that needed to be submitted by August 7, 2026 revealed all sorts of shortcomings in HelpDesk and Customer Support resourcing.
Even one of the big players had an absolute nightmare with their customer support service.
So, software must do many things. However, the vast majority of the tasks are bookkeeping tasks that tell you about business performance, so make sure this is front and centre of your thinking when you choose software.
And bear in mind that your bookkeeping software doesn’t need to be used for all three tasks. Storing digital records and sending Quarterly Updates, yes and yes, but tax returns often include other sources of income and expenditure as well as tax reliefs and adjustments, so it may be better to work with an experienced accountant or bookkeeper on your end of year tax return.
Sadie has submitted her own tax return for years but it might be that the great irony of MTD is that she needs a bit of outside help to get her tax return filed!
⚠️ In my view, there’s a big hole at the centre of MTD which is that MTD software is not accredited and there’s no sign that HMRC are going to deal with accreditation any time soon.
Good bookkeeping tells you how your business is doing, highlights any financial problems you may have and helps you make more money and better decisions.
So, if you don’t have separate bank accounts or any bookkeeping for your business or your property transactions then now would be a good time to start.
Your ordinary year-end accounts and tax returns will be much easier to do and, should you be caught by MTD, then you’ll be ready for the new filing requirements well before time.
As it happens, with just over £20k of sales each year, Sadie won’t be caught by MTD until the 2028-29 tax year.
And she’ll be ready for it when it comes.
Good bookkeeping is at the heart of a successful business. You can live without it but it’s better to live with it.
Invest in training. Learn how to do your own bookkeeping and give yourself the choice of whether to carry on yourself or bring in a bookkeeper to do the work if it’s not a good use of your time or you just can’t make head nor tail of it.
Choosing the right software is probably the biggest decision to make. Choose wisely and, if it isn’t working for you then change software!
MTD is nothing to lose sleep over. But it’s not going to go away. So, the sooner you get the bookkeeping and bank account building blocks in place the better prepared you’ll be.
We do a lot of software training with business owners in these three software products:
You’ll get to know how to use the software for YOUR business transactions, we’ll look at the reports that are available and customise them for you where we can. We’ll also show you how to check whether your numbers are correct.
On the MTD tax side, we had clients in the HMRC test programme and we have a number of clients who are already within MTD in the 2026-2027 tax year.
I wouldn’t say we’re living the dream but we’re certainly in the MTD thick of it!
In short – we can help.
So, be more Sadie!
Call Michael Austin on 020 7125 0270 or email info@bluedotconsulting.co.uk
Association of Taxation Technicians
Why two bank accounts are better than one
I stopped doing my books when I realised I was making them worse!
At Blue Dot Consulting, we work with owner-managed businesses across Central, West and South West London, including Fulham, Hammersmith, Richmond, Putney, Wandsworth, Kensington and Chelsea. If you’d like to improve your financial reporting, bookkeeping or decision-making, we’d be delighted to help.
© Blue Dot Consulting Limited, Chartered Accountants, Bedford House, Fulham Green, London, SW6 3JW
We don’t believe in forms, we believe in talking to people, finding out your needs and tailor-making a solution just for you.
Give us a ring on 020 7125 0270 or email us at info@bluedotconsulting.co.uk
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