What records need to be kept for 7 years?
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It’s a common question – How long should we retain my company's business records? Inland Revenue Authority of Singapore ("IRAS") states that companies are required to keep proper records and accounts of business transactions. The company must maintain proper records of its financial transactions and retain the source documents, accounting records and schedules, bank statements and any other records of transactions connected with the business. Show
IRAS states that accounting records and supporting documents relating to Year of Assessment (YA) 2008 and subsequent YAs, the company must retain the records for a period of five years from the relevant YA. Failure to do so may result in the expenses claimed being disallowed or/and penalties. What if my company has already been struck off?Where a company has been struck off and dissolved, a person who was an officer of the company immediately before the company was dissolved must ensure that all books and papers of the company are retained for a period of at least five years after the date on which the company was dissolved. Where a company is being wound up, the liquidator of the company must ensure that all the books and papers of the company are retained for a period of at least five years from the date of dissolution of the company. What happens if I do not keep the business records for the required amount of time?It is an offence under the Income Tax Act and/or GST Act to not keep proper business records for 5 years. Failure to produce the required business records when IRAS requests for them will result in the following.
IRAS e-Tax guide provides an overview of the mandatory record-keeping requirements for all GST registered businesses. According to IRAS e-Tax guide, records can be kept electronically using a computer and/or accounting software. This includes using Microsoft Office applications, off-the-shelf accounting software, customised accounting software and image systems. Physical copies of source documents need not be kept to substantiate the business transactions for tax purposes if the source documents are kept electronically. In addition, businesses do not need to seek approval from IRAS to keep their records in an electronic format for tax purposes. However, IRAS states that businesses should ensure that proper internal controls are put in place to ensure the integrity, completeness, accuracy, availability and reliability of the electronic records, including all transactions executed electronically, where applicable. As your financial life gets more complicated, it’s difficult to know how long to keep documents and when it’s safe to get rid of them. Some things you’ll need to hold on to for your whole life and others for just a few months. You probably already know that important documents such as tax returns, bank statements and paycheck stubs need special attention, but for how long, and in what format? And what is the best way to safeguard all that personal data? Here’s a quick list of financial documents to save, based on the time they should be kept. The length of time you should keep a document depends on the action, expense, or event which the document records. Generally, you must keep your records that support an item of income, deduction or credit shown on your tax return until the period of limitations for that tax return runs out. The period of limitations is the period of time in which you can amend your tax return to claim a credit or refund, or the IRS can assess additional tax. The information below reflects the periods of limitations that apply to income tax returns. Unless otherwise stated, the years refer to the period after the return was filed. Returns filed before the due date are treated as filed on the due date. Note: Keep copies of your filed tax returns. They help in preparing future tax returns and making computations if you file an amended return. Period of Limitations that apply to income tax returns
The following questions should be applied to each record as you decide whether to keep a document or throw it away. Are the records connected to property?Generally, keep records relating to property until the period of limitations expires for the year in which you dispose of the property. You must keep these records to figure any depreciation, amortization, or depletion deduction and to figure the gain or loss when you sell or otherwise dispose of the property. If you received property in a nontaxable exchange, your basis in that property is the same as the basis of the property you gave up, increased by any money you paid. You must keep the records on the old property, as well as on the new property, until the period of limitations expires for the year in which you dispose of the new property. What should I do with my records for nontax purposes?When your records are no longer needed for tax purposes, do not discard them until you check to see if you have to keep them longer for other purposes. For example, your insurance company or creditors may require you to keep them longer than the IRS does. Which documentation should be retained for seven years?Bank statements: All business banking, credit card, and investment statements, as well as canceled checks, should be kept for seven years, possibly longer, depending on your business or tax circumstances.
What records must be kept for 10 years?Legal Documents
For example, documents such as bills of sale, permits, licenses, contracts, deeds and titles, mortgages, and stock and bond records should be kept permanently. However, canceled leases and notes receivable can be kept for 10 years after cancellation.
What records should be kept forever?Records such as birth and death certificates, marriage licenses, divorce decrees, Social Security cards, and military discharge papers should be kept indefinitely.
What records need to be kept for 6 years?How long to keep employee records after termination? Employee data such as personal records, performance appraisals, employment contacts, etc. Should be stored for 6 years after the employee has left.
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