How long should I keep my Business Financial records?
Since most businesses deal with more than just the owner, there will be more record retention. Also, most business record retention requirements are more stringent.
Some records deal with the business, some deal with the customers, some deal with the employees, and some deal with the the South African Revenue Services (SARS).
Below are some of the records that businesses need to keep and the suggested amount of time to keep them:
Business Tax Returns and supporting records must be kept until SARS can no longer audit your return. In most cases, SARS can audit you for five years after a filing, but that time period can be indefinite if SARS suspects you made a “substantial error” on your return.
Payroll tax records, including time sheets, wages, pension payments, tax deposits and benefits must be kept for at least five years after the date the taxes fell due and was paid.
Current employee files should be retained for at least three years after an employee leaves, is terminated or retires. However, if an employee suffers a work-related accident or files a claim against the business, it’s advisable to retain your records indefinitely even after claim is resolved.
Ownership Records, such as business formation documents, annual meeting minutes,stock ledgers and property deeds, should be retained permanently.
Accounting Services Records should be retained for a minimum of five years. Accountants, being a conservative bunch, will often recommend that you keep financial statements, general ledgers, cash books and audit reports permanently.
Operational Records, including bank account statements, credit card statements, canceled checks, cash receipts and check book stubs, follow the five year rule.
Don’t forget, if you are unsure if you should keep something, keep it. It’s better to keep it and not need it than to need it but have thrown it out.
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