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Keeping records

Running a business can be unpredictable, but there is one certainty you can rely on – a good record keeping system can make tax time much easier!

The tax records you have to keep

You'll need to keep records to help you prepare your Business Activity Statement (BAS), and annual income tax return. Depending on your tax obligations you may need to keep other records as well.

Here’s a list of some of the tax records that business owners have to keep:

How long should you keep records for?

Legally you need to keep your records and documents for different lengths of time depending on the government department that needs the information or your business structure. In general, for:

  • Sole traders: must keep records for at least five years. You can decide whether to keep electronic or paper copies of records, but it’s recommended you store these in a safe and secure location and have a back-up of your records. Records have to be in English, or in a form that can easily be converted.
  • Companies: have more in-depth record keeping requirements. Financial records for companies must be kept for a minimum of 7 years.

If your business owns assets, Capital gains tax may apply. In this case you may need to keep records for longer.

How to keep records

You can keep records in paper form or store everything electronically.  Whichever you choose, make sure you store your records in a secure place. Familiarise yourself with proper backup procedures and if possible, have a secure off-site storage location.

Find out what you need to do to protect your records in an emergency.

If you decide to store your records electronically, make sure you’re aware of what you can do to protect against cyber-crime.

Did you know?

  • If you’re a sole trader you can record your business income, expenses, and vehicle trips on your smart device using myDeductions. At tax time you can upload your data to pre-fill your tax return or email it to your tax agent.

Find out more

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