As the year-end looms closer, it’s time for business owners and Directors to get a real hold on their accounts.

Doing a little bit of housekeeping, preparation and getting your accounts in order will make completing your taxes and filing your accounts a breeze, saving you time and money in the long run.

Get 14 Essential Tips For Your 2025 Year-End Accounts Preparation Below.

If you decide to reward your employees with bonuses, don’t forget about taxes.

Bonuses are subject to income tax – just like regular pay. If, understandably, you want to wait to pay the bonus after year-end, simply accrue the bonus and the employer’s national insurance cost, and reverse the accrual when payment is made. This ensures the cost is included within the correct financial year and lowers your Corporation Tax Bill.

Consider delaying payments to your suppliers by a few days to keep your cash balance high.

Whilst the supplier liability will be recorded on your Balance Sheet, a higher cash balance is still favourable and helps improve some of the ratios used by Credit Agencies.

Ensure all your employee expenses are processed before year end to include the cost in the correct tax year, and again, reduce your Corporation Tax Liability.

Review your PAYE, Pension, Wages, VAT control accounts, and make sure that these reflect the true position of liabilities.

Also, check your accruals, prepayments, deferred income, etc. If your Balance Sheet is not correct, the likelihood is that your Profit & Loss Account will be incorrect too!

Pinpoint what you did well – and what you didn’t.

Use your accounting software to generate Balance Sheet and Profit & Loss reports. Then identify what your business did well, and where there’s room for improvement next year.

Businesses live or die by their cash flow!

It’s one of the biggest issues for small companies, so use your accounting software to generate your cash flow statement. Xero add-ons such as Float can help you manage your cash flow forecast easily if you prefer to look forward rather than back.

If you have the cash (or finance) and require capital assets in the first few months of the next financial year, consider bringing the purchase forward before year-end so you can benefit from using the capital allowance in the current year and reduce your corporation tax liability.

Too many business owners fail to accurately estimate their tax payments. At the Finance Department, we recommend keeping this money safe and in a separate bank account.

By starting now, you should have time to put the right amount of money aside. The current corporation tax rate is 25% of your net profit (with effect 1st April 2025) on profits over £250,000.

For profits lower than this, a lower rate of 19% on your first £50,000 and then a marginal rate of 26.5% up to profits of £250,000, so estimate your corporation tax liability so that there are no surprises!

There will be adjustments that your accountant will make as part of the end-of-year process, adjusting for Capital Allowances and Research & Development Tax credits, but better to be prepared.

Make sure you know when the Corporation Tax is due, 9 months after your year end.

HMRC will help you here. Talk to them and check out their website for information about how to apply. Do this as early as you can, because there are penalties for late payment.

Talk to your insurance company to see if they have any recommendations, and talk to other insurers too, to ensure you have the best deal.

Double check that you have all statutory and recommended insurance cover, professional indemnity, public liability, employers’ liability, Directors and Officers cover, etc.

(That could be us!)

Each of these disciplines will have work to do for your business at year’s end. Talk to them, and make lists of tasks they need to carry out, which will help them focus on your business at this busy time of year.

Make sure all contact information is up-to-date.

You can kill two birds with one stone here. Go through your contacts database and make sure everybody’s details are correct. While you’re doing this, send them an email thanking them for their business this year; they’ll remember you.

Did you achieve everything you intended to last year?

If so, great. If not, try to find out why. Making goals for the coming year can help keep you motivated as your business grows. Review them regularly to stay on track. We can help create a budget that can be imported into Xero so you can compare monthly progress next year.

Let’s Talk

The Finance Department has helped dozens of UK tech companies get their financial house in order and scale with confidence.

Interested in finding out what the Finance Department could do for your business?

Book your free 30-minute Finance Diagnostic call and let’s chat.