Shoebox bookkeeping has worked for decades and been an effective, if not ideal, way to sort business expenses if you’re a sole trader or small business. Everything from paper receipts and supplier invoices to delivery notes and bank statements could at one time be stashed away in a shoebox or folder and handed to your accountant in a last-minute December rush.
As you can imagine, this way of organising things is not ideal for the sole trader or the accountant, and MTD (Making Tax Digital) is aiming to revolutionise this. However, many sole traders are not fully prepared for this Self Assessment change, as shoeboxes full of receipts are set to become a thing of the past.
In this blog, we’ll take a look at the pros of the new MTD system coming into force in April 2026, and how you can get ready for it with SparkReceipt.
Continuous reporting every quarter
The new feature from HMRC’s MTD will be quarterly reporting, so income and outgoing expenses need to be reported digitally every 3 months. There will also be a final year finalisation, as is currently the case, but no longer will you be able to leave receipts in a shoebox until a few weeks before the deadline.
On the bright side, SparkReceipt helps you get a clearer picture of how your business is performing throughout the year and gives a better idea of how much tax will be due at year’s end.
Eliminate issues with accuracy and memory
The shoebox method allowed sole traders to put off calculating tax returns until the end of the year, but that often caused problems as they couldn’t always remember what the receipts were for. Receipts can also fade over time and cause difficulty when trying to determine what was purchased, on which date, and for how much.
SparkReceipt’s simple to use software allows you to take a single scan of a receipt with your phone and upload it for your accountant to add to your new quarterly bookkeeping. This higher accuracy saves time and ensures you have clear bookkeeping in order year-round.
Reduce stress around tax returns
With the improved organisation of everything being digital, the stress of having to do all of your adding up and deductions, as well as preparing bank statements and remembering what happened when, is gone. All you need to do is scan a receipt or an invoice with SparkReceipt, you can even upload your bank statements, and everything is calculated for you.
There are no more missing important receipts which make your accounts inaccurate, or piles of paperwork to sift through. This gives you much more control of your finances too, as you can rest easy knowing everything is being taken care of by the software.
Improve digital record-keeping
With MTD combined with SparkReceipt, you won’t have to worry about scraps of paper going missing or being illegible. All of your data is compiled in a single place, which makes reporting much easier. Accountants can spot issues with your accounts much sooner without having to do the guesswork or contacting you to rack your brain about a certain transaction.
The improved visibility ensures you are compliant too, so you’re much less likely to be pulled up for an accounts investigation, and as it’s all filed in real-time, there’s no late penalties for not filing on time.
Give yourself a better overview of your business
It’s not always clear how your business is performing when you only complete your tax return once a year. Having the system kept up to date with every incoming and outgoing transaction for your business allows you to make better financial decisions.
You can see at a glance how profitable your business is, and it gives you the collected information you need to make informed decisions on things like pricing and budgeting, as well as current cash flow and investment. What’s more, everything is categorised with artificial intelligence.
Streamline your transition to MTD with SparkReceipt
While it did serve a purpose for many years, the shoebox method doesn’t fit in with the demands of Making Tax Digital, so transforming the way you do business is imperative from 2026 and beyond.
We know that MTD won’t be welcomed by everyone, and there are many business owners and sole traders who are not fully ready to make the transition. SparkReceipt lets you take a load off with a quick mobile scan of your receipts with your smartphone.
All of the data from the receipt or invoice is uploaded to the chosen platform to keep your bookkeeping in order and up to date, allowing your tax returns to be filed on time, every time.
Reporting information quarterly is more demanding, but with the right system in place – and the right accounting service by your side – these digital tools will help you be more organised so taxes are less stressful.
SparkReceipt understands exactly what is required by HMRC for MTD, and it helps sole traders streamline their reporting for accurate returns, logging everything digitally at the point of purpose, giving you more time to do what you love.
How Pier View Accounting works with SparkReceipt
Pier View Accounting have started moving all their clients across to the SparkReceipt solution.
This has been a game changer, for both us and our clients. No more squirting trying to work out what a receipt from almost 2 years ago was for, the simplicity of just taking a photo and uploading couldn’t be easier. SparkReceipt’s clever AI software and customisation also allows a lot of automation to take place, instantly allocating receipts to the correct categorisation.
MTD is going to change the way Sole Traders & Landlords have to report their tax affairs. SparkReceipt is the tool that will make their lives easier to make the transition!
