Short answerCapture all documents, categorise and reconcile every account, review debtors and creditors, run payroll, check VAT, review reports and lock the period.
A short, consistent month-end routine keeps your books accurate and makes VAT returns and year-end straightforward. Work through these steps in order.
1. Capture every document
- Upload all purchase receipts and supplier bills for the month
- Make sure every sales invoice issued is recorded
- Collect expense claims from staff
2. Process bank and card transactions
- Categorise every transaction in every bank and card account
- Match payments to the invoices and bills they settle
- Separate any personal spending and record it correctly
3. Reconcile all accounts
- Reconcile each bank, card and payment platform (for example PayPal or Stripe) to its statement balance
- Investigate and clear any unexplained items
4. Review what you are owed and what you owe
- Run aged debtors and chase overdue invoices
- Run aged creditors and schedule upcoming payments
5. Payroll
- Process starters, leavers and pay changes
- Run payroll and submit the Full Payment Submission to HMRC on or before payday
- Record PAYE, National Insurance and pension liabilities
- Upload pension contributions to your provider
6. VAT (if registered)
- Check VAT codes on transactions
- In a VAT quarter end, review and file the return through MTD-compatible software
7. Review the reports
- Profit and loss for the month and year to date
- Balance sheet
- Cash position and short-term forecast
- Note anything unusual to discuss with your accountant
8. Lock the period
Once everything is reconciled and reviewed, lock the month in your software so figures cannot change by accident.
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Frequently asked questions
What should be done at month end in bookkeeping?
Capture all documents, categorise and reconcile every account, review debtors and creditors, run payroll, check VAT, review reports and lock the period.
When must payroll be reported to HMRC?
Employers report pay through a Full Payment Submission on or before each payday under Real Time Information.
How long does monthly bookkeeping take?
For a small business with an up-to-date system, usually a few hours a month. Outsourcing moves that time off your desk.