Key takeaways
- As a self-employed person, you keep track of your invoicing, VAT and accounting yourself or via software.
- Save invoices and link your webshop to your administration.
- Set aside money for VAT and income tax.
- A webshop that provides invoices and data neatly saves a lot of work.
For many self-employed people, administration is the least enjoyable part of doing business — and that is precisely why it is left until things go wrong. Yet you don't have to be an accountant to do it well. With a handful of regular habits, you can keep your administration in order, your VAT return is correct, and you can receive the tax benefits you are entitled to. This article lists what you really need to keep track of and how you can make it easy for yourself.
Why your administration matters
Good administration is not bureaucracy — it determines how much you keep. It is the basis for your VAT return, proof of your deductions, and your insight into whether your webshop is actually profitable. Poor administration costs you money (missed deductions, errors in the tax return) and time (figuring everything out afterwards). Proper maintenance from day one is much less work than straightening it out afterwards.
What should you keep track of?
| What | How often | Why |
|---|---|---|
| Sales invoices | with every sale | basis for VAT returns and turnover |
| Purchase invoices and receipts | with every release | reclaim VAT and deduct costs |
| VAT return | per quarter | legally required |
| Hours worked | continuously | hours criterion for the self-employed deduction |
| Bank statements | monthly | connection with your accounting |
| Kilometers (business) | per ride | deductible or tax-free compensation |
Do not put this on separate notes or in your mailbox. One system — your webshop linked to an accounting package — saves you hours every quarter and prevents errors.
Invoices that are correct
A valid invoice contains at least: your company name and address, your Chamber of Commerce and VAT number, a unique invoice number, the date, a description, the amount excluding VAT, the VAT rate and amount, and the total. If you sell to private individuals, a receipt with that information is usually sufficient. If you sell for business purposes, a correct invoice is mandatory — and your customer needs it for his administration.
A webshop that automatically creates correct invoices takes this completely off your hands. Just registered? Read do you need a Chamber of Commerce for a webshop.
The VAT rhythm
You usually file a VAT return quarterly: the VAT that your customers paid minus the VAT on your purchases. The details — rates, the small business scheme and VAT refund — can be found in VAT and tax for your webshop. The golden rule: put the VAT you receive separately in a separate account or pot, so you will never be faced with any surprises when filing your tax return.
Link your webshop to your accounting
The biggest loss of time for self-employed people is duplication of work: typing orders by hand into an accounting package. Choose a webshop that exports or automatically links your sales data, so that turnover, VAT and invoices end up in the right place. This not only saves time, but also prevents retyping errors that will bother you when filing your tax return.
Don't forget the deductions and your hours
As an entrepreneur, you can, under certain conditions, use the self-employed person's deduction, starters' deduction and SME profit exemption. The hours criterion applies to the self-employed deduction: a guideline of 1,225 hours per year for your company. So keep track of your hours — not only your sales hours, but also administration, purchasing and marketing count. The full assessment can be found in the best webshop for self-employed people. Discuss your situation with your accountant.
Retention period: seven years
You are legally obliged to keep your administration for seven years. Save invoices, receipts and statements digitally and organized (quarterly or annually). A digital archive linked to your accounting makes this effortless and you can find everything if the tax authorities ever ask for it.
Common mistakes
- Leaving paperwork until the tax return - and then having to sort everything out at the same time.
- Spending the VAT received instead of setting it aside.
- Do not keep receipts for small expenses (and thus miss out on VAT and deductions).
- Not keeping track of hours and therefore not being able to demonstrate the hours criterion.
Frequently asked questions
Should I hire an accountant?
Not necessarily. Many self-employed people do it themselves with an accounting package that is linked to their webshop. In a more complex situation, an accountant or an annual audit is wise.
What information should be included on my invoice?
This includes your Chamber of Commerce and VAT number, a unique invoice number, the date, a description, the amount excluding VAT, the VAT rate and the total.
How long should I keep my administration?
Seven years. Keep invoices, receipts and statements digital and organized.
Do I need to keep track of my hours?
If you want to take advantage of the self-employed deduction, you must meet the hour criterion (guideline 1,225 hours). Track all your entrepreneurial hours, not just sales.
Can my webshop create invoices automatically?
Yes, on most modern platforms. Choose one that also exports to your accounting, and it will save you work every quarter.
What do I do with the VAT I receive?
Set this aside in a separate account or pot, so that the amount is still there when you have to file a tax return.
Get started
Set up one system today: your webshop linked to an accounting package, with automatic invoices, a permanent folder for receipts and a separate VAT fund. Track your hours from day one. If you start at the beginning, first go through the step-by-step plan to start an online store.
Further reading
do you need a Chamber of Commerce for an online store?
