Use bank statements to prepare your tax return

If you are self-employed or have side income, your bank statements are often the quickest record of what came in and went out during the tax year. A categorised spreadsheet makes the totals easy to find.

1. Collect the whole tax year

Download every monthly statement for the tax year from online banking. Check that the closing balance of each month matches the opening balance of the next, so no month is missing.

2. Convert and add categories

Convert the statements to Excel and add a Category column: income, rent, software, travel, personal and so on. Mark personal spending clearly so it is not counted as a business expense.

3. Total with a pivot table

A pivot table by Category gives you yearly totals in seconds. Keep receipts and invoices for the expenses you claim; a bank line alone may not be enough proof. Tax rules differ by country, so check what is deductible with your tax authority or an accountant.