Bad records are one of the most common reasons business owners lose deductions in a CRA review. Understanding the rules makes them easy to follow.
How long to keep records
The general rule is to keep records for six years from the end of the last tax year they relate to. For a 2026 tax year, that means keeping the records until at least the end of 2032. Some records, such as corporate minute books, share registers and records of share transactions, are needed for as long as the corporation exists and for a period after it is dissolved.
What to keep
- Sales records: invoices, sales slips, contracts and point-of-sale reports.
- Expense records: receipts and invoices for every deduction you claim.
- Bank and credit card statements, and records of loans.
- Payroll records: payroll registers, T4 slips, remittances and records of employment.
- HST/GST records: returns filed and support for input tax credits. Vendor invoices should show the supplier's registration number.
- Assets: purchase documents for equipment and vehicles.
- Corporate records: articles, bylaws, minute books, shareholder loan and dividend records.
Electronic records are allowed
You can keep records electronically, including scanned receipts, as long as they are accurate, readable and can be produced in a usable format for the CRA on request. The CRA can also ask for access to your accounting data. Cloud bookkeeping makes this easier; our cloud accounting service covers setup.
Why bookkeeping is more than paperwork
Records support every number on your tax return. In an audit, the CRA looks for evidence behind revenue, expenses, GST/HST claims and shareholder transactions. Missing support can mean denied deductions, reassessments, interest and penalties. See our audit support service if you have already received a letter.
Habits that keep you safe
- Use a separate business bank account and credit card.
- Record transactions monthly, not once a year.
- Reconcile your bank accounts to your books each month.
- Capture receipts as you go, using an app or a shared folder.
- Keep a mileage log if you claim vehicle expenses. See our self-employed deductions guide.
- Back up your files and note where original documents are stored.
Good books also make your year-end faster: your accountant can prepare financial statements and your T2 return on time without chasing missing information.
Our bookkeeping services can take this off your plate with monthly reconciliations and year-end packages.
This article is general information, not tax advice. Confirm current requirements on the CRA website.
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