You quote a job, you do the job, you get paid. Somewhere in the middle, a pile of receipts, fuel stops, merchant invoices and cash-in-hand payments to a mate who helped for a day quietly decide whether that job actually made you money. Most tradesmen find out the answer months later, if at all — usually when the accountant asks where half the year's receipts went.
Job costing just means tracking what a specific job costs you, against what you quoted for it, while the job is still running rather than after the invoice has been paid and forgotten. It sounds like office work. Done properly, it's two minutes a day and it's the difference between a business that grows and one that's permanently one bad job away from a rough month.
What job costing actually means for a tradesman
Forget the accountancy-speak. Job costing on a building site or a van comes down to one habit: every time money leaves your account — or your pocket — for a job, it gets tagged to that job. Not "materials, general." Not "this month's fuel." This job.
Do that consistently and you get something most one-man bands and small crews never have: a running total, per job, of exactly what's been spent — so you can compare it to the quote before it's too late to do anything about it.
The costs that quietly eat your margin
Materials are the obvious one. They're rarely the one that kills you. It's usually the smaller, scattered spends that don't get logged anywhere and add up to hundreds of pounds a month:
- Materials & merchant runs — timber, fixings, plumbing and electrical parts, paint, plasterboard. Easy to track when it's one big invoice, easy to lose when it's three separate trips to Screwfix.
- Fuel & mileage — vehicle costs racked up driving to and between sites, or claimed at the HMRC mileage rate if you use your own vehicle.
- Sub-contractors and CIS labour — anyone brought in to help on a job, with tax deducted under the Construction Industry Scheme where it applies.
- Plant & tool hire — mini diggers, scaffold towers, breakers — day-rate costs that belong entirely to one job.
- Consumables — blades, sealant, tape, dust sheets, screws by the box. Small, constant, and almost never tracked properly.
- Parking, congestion charges, food on long days — legitimate business costs that live in a jacket pocket until they're binned with the receipt.
- Tool replacement — the drill that got nicked off the van, the blade that snapped mid-job.
None of these are individually huge. Together, on a mid-sized job, they can be the difference between a 20% margin and a job you did for nothing.
Spreadsheet vs app: what actually gets used
Most tradesmen have tried a spreadsheet at some point. Most stop within a month — not because spreadsheets don't work, but because nobody wants to type up receipts at 9pm after a ten-hour day.
| Method | Set-up effort | What actually happens |
|---|---|---|
| Shoebox / glovebox | None | Receipts fade, get lost, or turn up in the wash. No job-level view, ever. |
| Spreadsheet | Medium | Works for a week. Falls apart once you're tired, on-site, or have no signal to update it. |
| General bookkeeping software | High | Built for an office desk, not a van. Category codes and reconciliation screens slow you down mid-job. |
| Purpose-built app (like Site Wallet) | Low | Snap the receipt, tag the job, done in under 10 seconds — on-site, one-handed, in gloves. |
A simple way to cost a job — worked example
Say you quote a bathroom refit at £4,200, assuming £1,400 in materials, £600 in sub-contractor plumbing, and the rest as your labour and margin. If every receipt and invoice gets tagged to "Bathroom — Henderson" as it happens, by the time you invoice you already know the real numbers: maybe materials ran to £1,650 because of a supplier price rise, plus £80 in extra skip hire nobody accounted for. That's £4,200 quoted against £2,330 in tracked job costs — a real 44.5% margin, not a guess. Without job-level tracking, you'd only find that out — or not — when the year-end accounts land.
What HMRC actually wants from you
Job costing and tax compliance aren't separate admin tasks — done right, they're the same records used twice.
- Self Assessment — as a sole trader, you need accurate income and allowable expense records to complete your return each year, and HMRC can ask to see them for up to six years.
- Making Tax Digital for Income Tax — HMRC is phasing in digital record-keeping and quarterly updates for sole traders and landlords, starting with higher earners first. If this applies to you, digital receipt and expense records aren't optional any more — they're the whole system.
- CIS (Construction Industry Scheme) — if you pay sub-contractors, you need records of what was paid and what was deducted. If you're paid under CIS yourself, keeping your own expense records is what gets you the biggest refund at year end.
- VAT — if you're VAT-registered (currently required once taxable turnover passes £90,000), every job cost needs a proper VAT-compliant receipt or invoice, not a scribbled note.
None of this is tax advice — rules and thresholds change, so check gov.uk or your accountant for your specific situation. But whatever the exact numbers, the underlying habit is the same: capture the receipt the moment it happens, tag it to the job, and let the totals build themselves.
Five mistakes that wreck job costing
- Mixing personal and business spending — one card for everything means every receipt needs manual sorting later. Nobody does it consistently.
- No per-job tagging — "materials" as a single bucket tells you nothing about which job actually cost what.
- Guessing mileage after the fact — reconstructing three months of site visits from memory rarely favours you, and rarely survives an HMRC check.
- Losing receipts before they're logged — thermal till receipts fade within weeks. If it's not captured digitally fast, it's gone.
- Never comparing actual costs to the quote — tracking spend is only half the job. The value is in catching a job running over budget while there's still time to do something about it.
How Site Wallet does this without extra admin
Site Wallet was built around one habit: snap a receipt, tag it to a job, move on. AI reads the vendor, total, date and VAT off the receipt in about two seconds — crumpled, faded till roll or handwritten, it copes. Every receipt and cash entry rolls up into a live per-job total, so you can see a job's running cost against its quote without opening a spreadsheet. When it's time for the accountant, export a PDF summary, a CSV for the books, or a ZIP of every receipt photo — one tap, six years of records kept safe either way.
FAQ
Do I need job costing if I'm just a sole trader with no crew?
Yes — if anything, more so. As a one-man band, there's no office admin catching mistakes for you. Job-level totals are how you know which type of job is actually worth taking on again.
How far back do I need to keep records?
HMRC generally expects sole traders to keep records for at least five years after the 31 January submission deadline of the relevant tax year — in practice, keeping six years covers you comfortably.
Does cash-in-hand spending still need tracking?
Yes. Cash spent on a job is still a business cost and, if it's income you've received in cash, it's still taxable income. Log both sides — cash in and cash out — against the job.
What if I don't have time to log receipts on-site?
That's the entire point of using a scanning app instead of a spreadsheet — snapping a photo takes less time than putting the receipt in your pocket, and the job-tagging can happen from the van at the end of the day if needed.