What tax records should I keep? | Gotax

What Tax Records do I need to keep after my Tax Return is done?

As a general rule you need to keep accurate and comprehensive records that validate any and all claims in your tax return. The Tax Office requires you to keep records for up to five years and to be able to provide evidence if your return is audited.

Here are the key types of records you should keep and for how long:

Types of Records to Keep

1. Income Records:

   • Payment Summaries/Income Statements: These include payment summaries from employers, pension payments, and government payments (Most of this is available from the Tax Office's internal systems).
   • Bank Statements: Showing interest earned.
   • Dividend Statements: From shares and managed funds.
   • Rental Income Records: Including rental properties, holiday homes, and other rental income sources.
   • Business Income Records: If you run a business, keep records of all business income.

2. Expense Records:

   • Receipts and Invoices: For all work-related expenses, such as tools, equipment, protective clothing, and other work-related purchases.
   • Bank and Credit Card Statements: To show expenses paid.
   • Travel Expenses: Including logbooks, receipts, and travel diaries.
   • Home Office Expenses: Such as utility bills, internet, and phone expenses, and a diary of hours worked from home.
   • Investment Expenses: Including expenses related to earning interest, dividends, or rental income.
   • Loan Statements: Showing interest paid on loans for investment properties.

3. Property Records:

   • Purchase and Sale Documents: For any assets you own, such as investment properties, shares, or collectibles.
   • Records of Improvements and Expenses: For capital gains tax (CGT) purposes, including costs of improvements and repairs.

4. Superannuation Records:

   • Contribution Receipts: For any personal super contributions.
   • Statements from Super Funds: Showing contributions and balances.

Duration for Keeping Records

• General Rule: You must keep most records for five years from the date you lodge your tax return. This includes income and expense records, bank statements, receipts, and invoices.

• Capital Gains Tax (CGT) Records: If you own assets subject to CGT (e.g., investment properties, shares), you need to keep records for five years after you dispose of the asset. This is to ensure you can substantiate the cost base and any capital gains or losses.

• Depreciation and Capital Allowances: If you claim depreciation on assets, you should keep records for five years after the last claim.

Specific Situations

• If You Amend Your Tax Return: Keep records for five years from the date you lodge the amended return.
• If You Are in a Dispute with the ATO: Keep records until the dispute is resolved and for five years from the date of resolution.

To sum up

You should keep:

1. Income Records: Payment summaries, bank statements, dividend statements, rental income records, business income records.
2. Expense Records: Receipts, invoices, bank and credit card statements, travel expenses, home office expenses, investment expenses, loan statements.
3. Property Records: Purchase and sale documents, records of improvements and expenses.
4. Superannuation Records: Contribution receipts, statements from super funds.

Ensure you keep these records for five years from the date you lodge your tax return or longer if specific circumstances apply, such as capital gains tax or depreciation claims.

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