Your Financial Year-End Checklist for Small Businesses in the UK

For small business owners, freelancers, and PAYE taxpayers in the UK, the end of the financial year is more than just a date. It’s a crucial checkpoint—a time to assess, organise, and strategise your finances. Whether you’re running an online store, managing a service-oriented freelance gig, or simply filing your personal tax return, the choices you make now can have a significant impact on your financial health going forward.

This guide explains everything you need to know about the 5th of April financial year-end. You’ll learn what it means, how to prepare, what happens after it passes, and how to get ahead in the new tax year.

What is the End of the Financial Year, and Why Does It Matter?

The end of the financial year, marked on the 5th of April in the UK, is a critical date for small business owners, freelancers, and personal taxpayers alike. This date represents the conclusion of the tax year, which runs from 6th April to 5th April annually.

Why is it important? It acts as the cut-off point for determining your annual income, expenses, and tax obligations. For small business owners, it’s a chance to evaluate your profits and determine how much tax you owe or whether you’re entitled to refunds.

For instance, if you run an online shop, understanding this deadline means you’ll take stock of your annual revenue, business expenses, and what’s left as net profit. Complying with your obligations to HMRC isn’t just about ticking off legal requirements—it’s an opportunity to gain invaluable insights into how your business is performing.

What Should Small Business Owners Do Before the Financial Year Ends?

The weeks leading up to the 5th of April can be hectic, but they’re also the perfect time to get your financial affairs in order. Here’s what you should prioritise to avoid last-minute stress and ensure a smooth financial year-end.

1. Make Sure Your Records Are Up to Date

Your bookkeeping is the foundation of your year-end preparations. This means ensuring that all invoices have been issued to clients, all business expenses are accounted for, and that payments—both incoming and outgoing—are tracked accurately.

For freelancers or sole traders, this could mean recording software subscriptions, equipment purchases, or even mileage if you use your car for work-related travel. Keeping these records organised can reduce your taxable income substantially when claimed as business expenses.

2. Claim All Allowable Expenses

Are you maximising your tax efficiency? Claiming allowable expenses can make a significant difference in reducing your taxable profits. For example, if you operate your business from home, you could include a portion of household bills like electricity or internet costs.

Don’t forget other expenses like office supplies, travel for business purposes, or professional services such as insurance or accounting software fees. Every allowable expense adds up!

3. Pay Outstanding Debts

If your business owes suppliers or service providers, now is the time to settle those bills. Clearing debt before the financial year-end shows a more accurate picture of your financial position and can make keeping track of your liabilities next year significantly easier.

4. Contribute to Personal Savings or Pensions

If you’re operating as both a sole trader and PAYE taxpayer, consider contributing to personal savings or a pension before the end of the year. Contributions might qualify for tax relief, helping your money stretch further while preparing for long-term goals.

What Happens After the Financial Year Ends?

Once the 5th of April passes, you officially step into the new tax year. However, the focus then shifts to completing your tax return for the previous year. Here’s what you need to do next.

Complete Your Self-Assessment Tax Return

For most small business owners and freelancers, this is the primary task post-financial year-end. You’ll need to report your total income and expenses for the previous year, calculate your taxable profit, and determine how much tax you owe to HMRC.

The deadline for submitting your online Self-Assessment tax return is 31st January 2026 for the 2024/25 tax year. However, completing it early can help you avoid any unexpected tax bills. Plus, filing early often means receiving refunds sooner if you’ve overpaid.

Check Payments on Account

Remember to review your “payments on account.” These are advance payments towards your next year’s tax bill, based on your previous year’s liability. If last year’s income was less than anticipated, you may be eligible to reduce these payments.

Review Financial Investments

If you’ve made significant investments—whether it’s upgrading office equipment, buying work vehicles or tools for a trade—make sure they are accounted for properly. Many of these expenses can reduce your taxable profit when filed correctly.

How Can You Plan Ahead for the Next Financial Year?

The end of the financial year isn’t solely about looking back; it’s also an ideal time to plan forward. Here’s how to maximise efficiency in the coming year.

1. Budget for Upcoming Taxes

Based on what you’ve learned from this year’s finances, set aside adequate reserves for next year’s tax obligations. A well-planned budget can help avoid being caught off guard by an unexpected tax bill.

2. Improve Efficiency

Take an analytical look at your financial records to identify potential areas for improvement. For example, if business utility bills are rising, consider switching to more affordable providers or renewable energy options.

3. Reinvent and Reinvest

Think about ways to reinvest your profits. Could you upgrade your equipment, hire help to expand your business, or set aside funds for VAT registration or payments? These steps can position you for long-term growth and stability.

4. Stay on Top of VAT

If you expect to meet or exceed the £90,000 VAT threshold in the new tax year, ensure you’re prepared for VAT registration. Registering late can result in penalties, so it’s best to stay ahead of the curve.

Simplify Your Year-End with Our Help

The financial year-end doesn’t have to be overwhelming. At Virtue Accountants, we specialise in helping small business owners, freelancers, and PAYE taxpayers streamline their finances.

Whether you need help preparing your Self-Assessment tax return, managing VAT, or claiming allowable expenses, our online accounting services are designed to save you time, effort, and stress.

Contact us today and see how we can simplify your financial year-end and set you up for success in the new tax year. Together, we’ll ensure your finances are in the best shape for 2025 and beyond.

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