How to use Google Sheets as your Free Accounting Software for a Small / Start Up Business in the UK

Just started selling online, running a small business or working for yourself? Our free Google Sheets bookkeeping template gives you one simple place to record every sale and every cost, so you always know what’s coming in and going out. Built for beginners. No Accounting software, no subscription, no cost.

BOOKKEEPINGSOLE TRADERS

Joanna Williams

10/30/20264 min read

This is ideal for a start-up business and maybe a small side hustle where you are testing out a new idea, product or service and don’t want to shell out on an accounting software like QuickBooks or Xero in case the idea does not work out as planned but you want to know how much you have spent and made.

When you have just started a business and are still getting to grips with setting it up, then it makes sense not to jump straight into using an accounting software that will cost money and time to set up and learn to use. Hopefully your business will soon become well established and you will be making some income. When that happens, then it will be time to invest in a book keeping template that will also calculate your tax, or an accounting software like QuickBooks, Clear books or Xero.

These dedicated accounting software for small businesses will make your bookkeeping and accounting easier and will handle all your taxes such as VAT, Income Tax. Corporation tax for you easily. They will also meet the statutory compliance by all the regulatory bodies such as HMRC and Companies House (if you operate your business as a Limited Company).

But for now, the one free way of doing your bookkeeping Is to use Google Sheets. If you have a Google Account then this is free. As an accountant I have to say I don’t find it as powerful and easy to use as Microsoft excel but it will do what you need it to do well at this stage.

So you need to create a way of capturing all your expenses and income so you can know how much you have spent, how much is coming in and what your profit is.

On a Google sheet create 5 tabs and name them as below:

v Business Details

v Bank Transactions

v Chart of accounts

v Transactions

v Income statement

On the Business details tab you put your business name, the month you started the business or if this is not your first year in business put the accounting period start date. Also include your end date which will usually be 12 months. But it does not have to be. If this is a test project and you are only testing for 3 or 6 months then that will be your accounting period. Example below.

The 2nd tab will be your chart of accounts and will detail your source(s) of income and what your expenses are. For example, if you provide services such as marketing, consulting, mentoring, physiotherapy sessions, massage sessions etc then those are your streams of revenue / income and you will list them as such. Further down down on the sheet you will list your expenses such as mileage, rent, website or landing pages costs, etc. shown below

The layout out of your 3rd tab – Transactions is as shown below with 4 columns : Date Category, amount and description. The description column is free form and you can add as much detail as you need. The positive values should be set up to show in black ink and the expenses as red.

Then you have the 4th and final tab where it all comes together, all your income and expenses and your profit at the bottom of the page. The set up is as shown below with all your streams of income at the top and all your expenses at the bottom and the difference between the two will be your profit or loss. The set up on this tab is such that it pulls all the information from the transactions tab. You will need some excel spreadsheet skills to get this set up and pulling properly but it is not difficult.

You will see that from our example, this business made a profit of £150 so far.

That is how easy and simple it is to set up a simple Google sheet template in less than a day that you can use as a new business without the monthly costs of an accounting software.

Better still you could even save yourself more time by downloading for a free a ready set up template that you can start to use right away.

Or better still why not grab a free copy that you can start to use right away:

Click Here for Your Free Google Sheet Bookkeeping Template