In short
Small business bookkeeping means recording every sale and expense with a receipt, keeping business money in a separate account, reconciling monthly and keeping records for as long as your tax authority requires (often several years). Many small businesses use simple cash-basis accounting and a bookkeeping app.
A simple system
- 1
Separate account
All business payments through one account. Categorizing becomes easy.
- 2
Digital receipts
Snap a photo or save the PDF to a folder per month. Many apps do this automatically.
- 3
Monthly reconciliation
Compare bank statement and receipts once a month. Missing items show up early.
- 4
Set money aside for taxes
Put a share of every payment into a tax savings account so the tax bill is no surprise.
What to track
Sales, refunds, product costs, platform and payment fees, advertising, software subscriptions, equipment and a business share of phone and internet. Keep receipts for all of them.
FAQ
Do I need bookkeeping software?
Not at the start, a spreadsheet works. Software saves time once you have many small orders.
How long should I keep records?
Usually at least several years. In the UK, sole traders keep records for at least 5 years after the Self Assessment deadline. In the US, the IRS generally recommends 3 to 7 years.
Should I hire an accountant?
Not required, but helpful for your first tax return or when your business grows.
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Editorial team 5minstore · Updated: November 1, 2026. General information, not legal or tax advice.