As a business owner, you're responsible for maintaining accurate and up-to-date records. These aren't just for smooth day-to-day operations - they're also critical for compliance.
Business Records
Self-employed individuals should keep tax records for at least 5 years after the submission deadline for the relevant tax year. Limited companies are advised to keep records for at least 6 years.
If your records relate to multiple tax years, you may need to retain them longer. This includes business income, expenses, loan details, and capital allowance documentation.
Employment Records
Employers must retain payroll and employee records - such as names, addresses, NI numbers, and pay details - for at least 3 years.
Other Types of Records
Health and safety documentation and corporate records like meeting minutes and articles of association should be retained for up to 10 years.
Digital Record Keeping
Modern businesses are increasingly storing records digitally via accounting software. This saves space, improves security, and allows easy access.
Making Tax Digital (MTD)
MTD is already mandatory for VAT, with voluntary opt-in for income tax self-assessment (ITSA).
What If You Don’t Keep Records?
Failing to keep adequate records can result in penalties ranging from £250 to £3,000. In severe cases, it may lead to disqualification as a company director.
📞 Want help managing your records? Contact Profectus Accounting
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