Guide showing how to use simple bookkeeping template

This is a guide showing how to do simple bookkeeping for sole-traders, self-employed, start-ups and micro businesses in Ireland, who are not registered for VAT.

We have created a handy template which will save you time with bookkeeping. But you can follow this guide without buying our template, just follow the basics on how to prepare your sales, expenses and profit and loss account. This basic bookkeeping spreadsheet will help you to prepare your income tax return at the end of the financial year.

You can buy and download the template here. The price for the template is €9.

5 steps to prepare your bookkeeping records yourself

Step 1 – Business information

Fill in all the basic information about your business. This information is used in other tables in the spreadsheet.

Simple bookkeeping for sole trader - Step 1 - Business info
Simple bookkeeping for a sole trader – Step 1 – Business info

Step 2 – Income/Sales

Take all your income invoices/receipts and sort them into date order. Then take the first invoice and start to fill in sales table with the date, amount and client name. Take the next invoice and fill in the next row the same way as the first invoice. Continue with all invoices that you have for the year.

At the bottom of the table is the total cell. There is a formula which will calculate amount of all invoices recorded. That number is your total gross sales for the year.

Simple bookkeeping for sole trader - Step 2 - Sales
Simple bookkeeping for a sole trader – Step 2 – Sales

How to insert more rows in the table

The table is set up for 30 invoices. If you need more rows, then highlight the row where you want to add a new row in the table by pressing left mouse button. Once highlighted, press right mouse button and from the menu choose “Insert row” and a blank row will be inserted in the table.

How to insert more rows in a Excel table
How to insert more rows in the Excel table

Step 3 – Expenses

Take all your expense invoices and receipts. If you have different types of expenses, you can sort them in date order and start to record them with Date and Amount in Step 3 – Expenses table. In the Note cells you can write details for what these receipts are for (the purpose of buying goods or services), for example stationary, tools, courier cost etc.

Business use in %

If the cost was partly used privately for example telephone cost, input how much of the cost was used for business in percentage range 1% – 100%. For example one half of the telephone cost is 50%. If it is purely business cost, input there 100%. Then in Business Use Total cell is a formula which will calculate business amount based on the business percentage you filled in.

Take the next invoice and record it in the next row the same way, you recorded the first invoice. Continue with all invoices you have for the year.

At the bottom of the table is a Total cell. There is a formula which will calculate amount of all invoices recorded. The Business Use Total – Total number is your total expenses for the year.

Simple bookkeeping for sole trader - Step 3 - Expenses
Simple bookkeeping for a sole trader – Step 3 – Expenses

Step 4 – Capital Allowances

When you purchase assets (like van, machine, laptop, phone, furniture, equipment etc.), you can not claim that expense in full in your income tax return. Assets are items which you use over the long-term to help you to generate income. That’s why you need to apportion a purchase price over the period of time. Standard capital allowances in Ireland is 12.5% of asset purchase price (for plant and machinery). It means that purchase price expense is deducted over 8 years. For example, for a van which you purchased for €30,000 you can reduce your income by €3,750 value of capital allowances and you will reduce it with this amount for the following 8 years.
Input each item into separate row and calculate your capital allowances for the tax year.

An example in the picture below:

Mark has an old van, which he bought in 2018. He paid €6,000 for the van and he uses the van purely for business, so he input 100% for Business use. The business use value is full amount €6,000. The rate for calculating capital allowances is 12.5% of the business use value (€750 for each year). This rate was used for capital allowances for the previous years (2018 = €750, 2019 = €750, 2020 = €750, 2021 = €750, total: €750 x 4 years = €3,000. The opening value balance for 2020 is €6,000 (purchase price) – €3,000 (capital allowances for 2018 – 2021) = €3,000. Mark input €3,000 into Opening Balance cell.

In 2022 he decided to trade in the old van and buy a new van. He traded the old van for €800 (Mark got discount €800 from the price of the new van). Mark recorded the discount €800 as a sale price for the old one in the Sale of asset cell. The value of the van in Mark’s bookkeeping was €3,000 (Opening Balance) – €800 (Sale price) = €2,200. Because Mark sold the old van, he doesn’t have this van anymore, so the value €2,200 is actually a cost for Mark. He sold the old van for a lower price than its value in Mark’s bookkeeping. The value of €2,200 is cost for Mark, that’s why Mark will write off the value in the Capital Allowances cell for 2022. Closing balance of the old van is nil value because he doesn’t have the old van anymore.

The purchase price without discount for the new van was €28,000. A trader then applied discount €800 from the purchase price and Mark paid €27,200 by BACS transfer. Mark recorded the new van into next row as follows: Value is full purchase price €28,000. Van is purely for business use, so Mark input 100% value into Business use in % cell. The rate for calculating capital allowances is standard 12.5%, which is €3,500. The opening balance is the same as business use value, because the van was bought in 2022 and Mark is calculating the capital allowances for 2022. The capital allowance is €3,500 and is calculated automatically, because there is a formula in the cell. The Closing balance is €28,000 (Opening balance value) – €3,500 (Capital allowances value) = €24,500. The Closing balance value of €24,500 will be the Opening balance value when Mark will be calculating his capital allowances for 2023.

In 2022 Mark bought a new cell phone for €790. He uses the phone mainly for business, but sometimes he is doing private calls as well. So he checked his detailed phone bill and found out that 80% of his calls is for business purposes. Mark input 80% into Business use value. The Business use value is calculated automatically and is €632. The opening balance is the same as business use value. The capital allowances is €79 and is calculated automatically. The Closing balance value of €553 will be the Opening balance value when Mark will be calculating his capital allowances for 2023.

Simple bookkeeping for sole trader - Step 4 - Capital Allowances
Simple bookkeeping for a sole trader – Step 4 – Capital Allowances

Step 5 – Profit and Loss Account

Most information in the Profit and Loss Account table is populated automatically from previous tables. You only need to fill in the section in the bottom of the page, Prepared by. Don’t forget to sign it off, if it is for bank, social welfare or other institution.

Simple bookkeeping for sole trader - Step 5 - Profit and Loss
Simple bookkeeping for a sole trader – Step 5 – Profit and Loss

You can use the Profit and Loss table when you will fill in your Income tax return. Summary of sales, expenses and capital allowances will help you to fill in Accounts extracts section in your Form 11 – Income tax return.

Profit and Loss Account and Form 11
Profit and Loss Account and Form 11 in ROS system