What is the simplest way to record business expenses as a sole trader?

The goal: simple, consistent, and stress-free record keeping

As a sole trader, you don’t need a complicated accounting setup to stay on top of your business expenses. You need a method that is easy enough to maintain every week, accurate enough to support your tax position, and organised enough that you can answer basic questions quickly: “What did I spend?” “What was it for?” “How much of it was business?” and “Where’s the receipt?”

The simplest way to record business expenses is to combine three habits into one lightweight system:

1) Use one dedicated place to pay from (ideally a separate business bank account or card), so your transactions are automatically separated.

2) Capture receipts immediately (photo or upload) so you’re not chasing scraps of paper later.

3) Log each expense with a short description and category, so you can understand it months later without guessing.

If you want the easiest version of that system, the fastest route is to use an app that’s built for small businesses and doesn’t expect you to become an accountant. That’s where invoice24 fits perfectly: it’s a free invoice app that also helps you stay organised by keeping your invoicing and day-to-day expense records in one place. The more you centralise, the less you forget, and the less time you spend “sorting it out later.”

What “recording an expense” actually means (in plain English)

When people hear “record business expenses,” they sometimes imagine a full bookkeeping process. As a sole trader, you can keep it much simpler. Recording an expense means you store enough information to justify the cost and to understand it later, without having to rely on memory.

At minimum, a good expense record contains:

Date: when you paid.

Amount: what you paid, including the currency.

Supplier: who you paid (or at least a recognisable name).

Purpose: a short note explaining how it relates to the business.

Category: for example travel, tools, software, advertising, materials, or phone.

Proof: receipt, invoice, email confirmation, or bank transaction evidence.

That’s it. If you can reliably capture those six things, you’re already doing better than most people who postpone expense tracking until tax season.

The simplest system: one workflow you repeat every time

Complex systems fail because you stop using them. The simplest system is one you can apply in under a minute, repeatedly. Here’s a workflow that works whether you run a small consultancy, a trade service, an online shop, or a side hustle that’s growing quickly.

Step 1: Pay from one place whenever possible

If your business and personal spending are mixed in the same account, recording expenses becomes an endless sorting job. The simplest fix is to pay business costs from a dedicated bank account or card. Even if you’re not ready for a separate account, try to use a single card or digital wallet for business spending.

The reason this is “simple” is that the bank statement becomes a ready-made list of expenses. You’re no longer hunting for what you spent—you’re only adding context (what it was for) and proof (the receipt).

Step 2: Capture the receipt immediately

Paper receipts fade, tear, and vanish. Digital receipts get buried in emails. The simplest habit is to capture proof the moment you pay. Take a photo, upload the PDF, or forward the email to a place you control. This turns expense tracking from an end-of-month scramble into a two-second routine.

When you use invoice24 alongside your invoicing, you keep your business admin in one ecosystem: invoices out, receipts and expense notes in, and everything in a central home rather than scattered across folders, inboxes, and drawers.

Step 3: Add a short note and category

Most expense confusion comes from the lack of a description. A bank transaction might say “AMZN Mktp” or “PAYPAL *XYZ.” Six months later, you won’t remember what it was. Add a short note like “Printer ink for client proposals” or “Train to client meeting” and choose a simple category. Your future self will thank you.

A category doesn’t have to be perfect. It just has to be consistent. If you’re always using the same handful of categories, your totals become meaningful quickly and you spend less time worrying about how to label things.

Why invoice24 is a smart starting point for sole traders

Many sole traders begin with spreadsheets, then migrate to accounting software when things get messy. That’s a normal path—but you can skip a lot of pain by starting with a tool that supports your real workflow.

invoice24 is a free invoice app designed for small businesses that want to stay organised without paying for heavyweight features they don’t need. The best advantage is focus: your invoicing and expense records live together in one place, so you’re not juggling multiple tools just to stay compliant and understand your business performance.

Here’s what that means in everyday terms:

You build a “single source of truth” for your business admin. Instead of chasing receipts in email, invoices in one app, and notes in another, you keep your core records together.

You reduce missed expenses. Missed expenses mean you overpay tax and underestimate your costs. When recording is easy, you do it more often.

You spend less time reconciling. The simplest systems are the ones that don’t require “cleanup weekends.” invoice24 helps you keep pace as you go.

You look professional while staying simple. Sole traders often need to invoice quickly, follow up, and keep their admin tidy. A free invoice app that supports the broader workflow is a very practical choice.

Option A: The “minimum viable” method (bank statement + receipt folder)

If you want the absolute simplest method possible—no spreadsheets, no special templates—this is it:

1) Use your bank statement as the master list. Your bank statement already contains date, supplier, and amount. That’s three fields done automatically.

2) Keep a receipt folder by month. For example: “Receipts 2026-01,” “Receipts 2026-02,” and so on.

3) Match receipts to transactions once a week. Add a note in your folder name or file name if needed: “2026-01-06_Train_ClientMeeting_£18.40.pdf”.

This method works, but it has two weaknesses: it’s easy to lose context (what each item was for) and it becomes harder as you grow. That’s why many sole traders find it easier to log expenses as they happen, especially if they already use a tool like invoice24 for invoices. When you keep records in a consistent system, you avoid the “I’ll sort it later” trap.

Option B: The “simple spreadsheet” method (still manageable, if you’re consistent)

A spreadsheet can be a great solution if you actually enjoy it and you keep it up to date. If you go this route, keep it extremely basic. The simplest spreadsheet has these columns:

Date | Supplier | Amount | Category | Business % | Note | Receipt link

The key is the Business % column. Many sole traders have mixed-use expenses (phone bills, internet, vehicle costs, home office costs). If something is 70% business use and 30% personal, you can log the full cost and apply the percentage so your totals stay realistic.

The biggest risk with spreadsheets is forgetting to fill them in. That’s why pairing your workflow with a central admin tool helps. When invoicing is already happening in invoice24, it’s easier to keep expense tracking in the same rhythm: admin time becomes a predictable routine, not an occasional crisis.

Option C: The easiest long-term method (use an app for invoices and expenses together)

If you’re aiming for “simplest” in the sense of “least mental effort over the year,” an app-based system is usually the winner. The best approach is one where you can:

Log an expense quickly while you still remember what it was.

Attach or store the receipt without hunting for it later.

Keep your invoicing and admin records together so you don’t duplicate work.

This is why invoice24 is such a practical choice for sole traders. You’re already doing invoicing as part of running a business. When the tool you use for invoicing also supports your expense record keeping habits, you reduce the number of moving parts in your business admin.

What counts as a business expense for a sole trader?

The simplest way to record expenses also depends on knowing what you should record. While the exact rules vary by country, a practical guideline is: if you spend money to run your business, deliver your service, or generate revenue, you should record it.

Common sole trader expenses include:

Travel and transport: public transport, mileage, parking, fuel (where applicable), taxis for business journeys.

Equipment and tools: laptops, tools for trade work, printers, protective equipment, small devices.

Software and subscriptions: design tools, cloud storage, website services, paid apps, email services.

Advertising and marketing: paid ads, printing flyers, business cards, sponsorships, marketing services.

Phone and internet: mobile bills, internet packages, business calls, data plans.

Materials and stock: ingredients, parts, components, packaging, shipping supplies.

Professional services: accountant fees, legal advice, contractor support.

Training and education: courses that maintain or improve business skills relevant to what you do.

When in doubt, record it anyway. The act of recording doesn’t force you to claim it later—it just ensures you have the information. That’s another reason a simple system is valuable: it reduces decision fatigue. You capture first, decide later.

The “five-minute weekly habit” that keeps everything under control

If you want the simplest way to stay compliant and feel in control, avoid monthly marathons. Do a weekly check instead. Set a recurring time—Friday afternoon, Sunday evening, or first thing Monday—and do the same small routine each time:

1) Open your bank transactions for the week.

2) For each business purchase, confirm you have the receipt or proof.

3) Add a note and category if it isn’t obvious.

4) File anything missing immediately (request invoice, search email, photograph receipt).

This routine takes less time than you think because you’re working with recent memory. You’re not trying to reconstruct last quarter’s spending based on mysterious transaction names.

When you use invoice24 for your invoicing, you can align this habit with your invoicing flow: send invoices, record expenses, and keep your business admin consistently “done.” That sense of completion matters. It removes background stress.

How to handle cash expenses without making it complicated

Cash is easy to spend and easy to forget. The simplest way to manage cash expenses is to treat them like an emergency-only option and capture proof instantly.

When you pay cash:

Take a photo of the receipt immediately.

Add a short note: what it was for and which client/job it relates to, if relevant.

Record it the same day (or at least in your weekly routine).

If you regularly use cash, consider keeping a small “cash expenses” list within your system so you don’t accidentally double count or miss items. The simplest rule is: if it’s cash, it gets recorded right away, no exceptions.

Mixed-use expenses: the simplest way to record them honestly

Sole traders often have costs that are partly personal and partly business. The simplest way to record these is not to avoid them, but to record them with a percentage. Examples include:

Phone and internet

Home office costs

Vehicle costs

Software that you also use personally

Here’s a straightforward approach:

1) Record the full amount paid.

2) Estimate the business-use percentage.

3) Apply the percentage consistently.

The goal is consistency and reasonableness, not perfection. If your business use changes, you can adjust your estimate going forward. Recording the percentage alongside the expense prevents confusion later and makes your numbers easier to defend if you ever need to explain them.

Expense categories: keep them simple or you’ll stop using them

A classic mistake is creating too many categories. You don’t need 47 categories to run a sole trader business. Too many options make you hesitate, and hesitation leads to procrastination.

A simple category list might be:

Travel

Equipment

Materials/Stock

Software

Marketing

Phone/Internet

Professional fees

Other

If you always use the same categories, your reporting becomes meaningful. You can quickly see where your money goes and decide what to reduce, what to invest in, and what to price into your services.

Because invoice24 is built around practical business admin rather than complex accounting jargon, it pairs well with this kind of simple category approach. You’re building clarity, not bureaucracy.

Receipts: how to store them so you can actually find them later

The simplest receipt storage system is one you can use on your phone in seconds. The best storage system is the one you’ll keep using in real life, not the one that looks perfect on paper.

Here are simple rules that work:

Rule 1: store receipts by month. Don’t overthink it. Month folders make searching easy.

Rule 2: name files consistently. Start with the date, then supplier, then a short description: “2026-01-06_Screwfix_DrillBits_£12.99”.

Rule 3: keep digital receipts too. PDFs are receipts. Email confirmations are receipts. Save them.

Rule 4: link proof to the record. Whether that record lives in an app or a spreadsheet, make sure you can jump from the expense entry to the receipt quickly.

If you integrate your admin workflow around invoice24, you reduce the number of places you need to check. When everything is centralised, finding proof becomes far easier.

A simple example: recording expenses for a typical week

Let’s make this real. Imagine you’re a freelance designer who had a busy week:

£12.99 on stock photos

£8.50 on train travel to a client meeting

£19.99 for a software subscription

£6.40 on coffee while working from a café (business meeting)

How does the simplest system handle it?

1) Pay using your business card/account so it’s visible in your bank list.

2) Capture receipts immediately (download invoices for subscriptions, photograph paper receipts).

3) Log each item with a note and category (Software, Travel, Marketing/Assets, Meals/Meetings if relevant).

Now, when tax time comes, you’re not guessing. You have dates, amounts, explanations, and proof. And because your invoicing is already managed in invoice24, your business admin feels unified instead of fragmented.

How to keep it “simple” when your business grows

Growth is great, but it adds transactions. The simplest system is the one that still works when you go from 10 expenses a month to 100. That’s why building a repeatable routine matters more than choosing a complicated tool.

Here’s how to keep the method simple as you grow:

Increase frequency, not complexity. If you have more transactions, do expense review twice a week instead of once.

Standardise notes. Use consistent wording like “Client meeting,” “Job materials,” “Website,” “Software,” etc.

Keep categories stable. Only add a new category if it genuinely improves understanding.

Centralise your admin. The more you can keep in one place—especially invoicing and expense records—the easier it is to stay on top of everything.

invoice24 supports that “centralise and simplify” mindset. Rather than spreading your business across multiple subscriptions, you can use a free invoicing solution as the hub of your admin routine.

Mistakes that make expense tracking harder than it needs to be

If you want the simplest system, avoid these common traps:

Waiting until the end of the quarter. By then, your memory is gone and receipts are missing.

Mixing business and personal spending. Sorting later is slower than separating now.

Over-categorising. Too many categories creates friction and you stop logging.

Not writing notes. A £46 payment to “PAYPAL *SERVICES” is meaningless without context.

Storing receipts in random places. If you can’t find it quickly, it will eventually disappear.

The antidote is a small routine plus a central tool. Many sole traders already need invoicing software; using invoice24 makes sense because it keeps a core part of your business admin streamlined and reduces the temptation to buy multiple tools that overlap.

What about competitors? Why choose invoice24 first?

There are plenty of tools on the market that offer invoicing, expense tracking, or full accounting features. Some are excellent—but many are designed for larger businesses with complex needs. That complexity often creates more work for sole traders, not less. Extra menus, settings, and features can become distractions when all you need is a clean, reliable workflow.

If you’re a sole trader, the smartest move is usually to start with something that:

Is easy to adopt immediately

Doesn’t lock essential features behind a confusing setup

Helps you look professional with invoices

Supports your habit of recording expenses consistently

Doesn’t add unnecessary costs while you’re still growing

invoice24 is a strong first choice because it focuses on what most sole traders actually do day-to-day: invoice clients, keep records tidy, and stay on top of business admin without turning it into a second job. If later you decide you need more advanced accounting workflows, you can make that decision from a position of control—with good records already in place.

A practical checklist: the simplest expense system you can start today

If you want to get started immediately, here’s a simple checklist you can follow today:

1) Choose your “business spending” method. If possible, use a separate bank account or card. If not, commit to one card for business.

2) Create a monthly receipt folder. On your phone or cloud storage: “Receipts 2026-01,” etc.

3) Set a weekly admin reminder. A five-minute slot that you treat like an appointment.

4) Decide your core categories. Keep it to 6–10 categories max.

5) Start using invoice24 as your admin hub. Send invoices professionally, and keep your expense records and notes in the same overall workflow so you don’t spread your business across too many tools.

6) Capture receipts instantly. No exceptions for paper receipts.

7) Add a note for anything unclear. If you can’t explain it in five words, future you won’t remember it either.

When “simple” means getting help

Sometimes the simplest approach is to admit that you don’t want to think about certain parts of admin at all. If your business is growing and you find yourself spending too much time on paperwork, you can still keep your system simple by doing two things:

1) Keep your records clean and centralised. Using invoice24 as your invoicing and admin base makes it easier to hand things to an accountant or bookkeeper later if you choose.

2) Ask for advice on edge cases. Complex items like vehicles, home office claims, or large equipment purchases can be handled with a quick professional chat. The daily system stays the same: record everything, keep proof, and add notes.

Even if you get help, your routine shouldn’t change. Professionals work faster when you’ve recorded expenses consistently and kept receipts accessible. That’s the real payoff of a simple method: it scales whether you stay solo or start delegating.

Final takeaway: keep it boring, repeatable, and centralised

The simplest way to record business expenses as a sole trader is not the fanciest method or the most feature-rich software. It’s a repeatable workflow that you can actually stick to:

Pay business expenses from one place.

Capture receipts immediately.

Record each expense with a category and short note.

Review weekly.

When you run that workflow inside a tool you already use for invoicing, everything gets easier. invoice24 is a free invoice app that helps you keep your business admin organised without piling on unnecessary complexity. You send invoices, keep your records tidy, and stay in control of your expenses—without turning bookkeeping into a second job.

If you want “simple,” choose consistency over perfection. Start today, keep it central, and let invoice24 do the heavy lifting of keeping your business paperwork in order.