What you must keep
- Sales invoices and receipts.
- Purchase invoices and bills.
- Bank and credit card statements.
- Payroll records and pension information.
- VAT records if registered.
- Asset purchases and loan agreements.
- Records of director transactions.
How long to keep records
Companies must keep records for six years from the end of the financial year they relate to. Payroll records should be kept for at least three years. Keeping them longer is wise if there is a dispute or a tax enquiry.
Bookkeeping done for you
Records kept up to date and reconciled, ready for year end and for your accounts.
Get a bookkeeping quoteBookkeeping servicePaper versus digital
| | Paper | Digital | |
|---|---|---|
| Storage | Needs space and protection | Cloud or drive, easily backed up |
| Searching | Slow | Instant |
| Sharing with your accountant | Post or scan | Instant access |
| Legal acceptance | Accepted | Accepted, provided it is clear and complete |
| Making Tax Digital | Not enough for VAT | Required for VAT |
Going digital
- Choose accounting software with receipt capture.
- Scan or photograph paper receipts and store them with the transaction.
- Back up automatically.
- Name files consistently, such as date and supplier.
Digital records and MTD
If you are VAT registered you must keep records digitally and file returns through MTD software. See MTD software and digital records.
Good habits
- Record transactions weekly.
- Pay business costs from the business account.
- Keep personal spending separate.
If you lose a record
Ask the supplier for a copy or bank statement evidence. HMRC may accept reasonable alternatives but expect questions.
Frequently asked questions
Can I throw away paper receipts after scanning?
Generally yes, if the digital copy is clear and complete and you can produce it when asked.
How long must I keep bank statements?
At least six years for company records.
Keep reading
How Often Should You Update and Reconcile Your Books
Update your books weekly if you can, and reconcile your bank accounts at least monthly. Little and often takes less time than a year-end clear-up.
VATMaking Tax Digital Software and Digital Records for Small Companies
MTD for VAT needs compatible software and digital records with no manual re-keying between systems. Most small companies use cloud accounting software that submits the return directly to HMRC.
Tax and HMRCHMRC Investigations: What Micro-Entities Need to Know
HMRC can check any company's tax returns. For ordinary errors it can go back four years, six for carelessness and twenty for deliberate behaviour. Good records are your best protection.