News

Before we know it, spring will be upon us, and the spring-cleaning season will commence. What a great opportunity to get ahead and sort through your records and get organised for the upcoming year.  A clear out always feels great, however, it is important to remember that your records must be retained for a specific length of time depending on your circumstances.

If you are self-employed, you must keep your business records for at least five years from the 31 January following the end of the tax year.  For example, if you have just submitted your 2020/21 tax return to HM Revenue & Customs, you must keep your records until at least the end of January 2027.

For individuals that are not self-employed, but complete a Self Assessment tax return for another reason, the retention period for keeping records is reduced to 22 months from the end of the tax year to which they relate.  For example, if you have just submitted your 2020/21 tax return to HM Revenue & Customs, you must keep your records until at least the end of January 2023.

Apart from complying with your legal obligations, there are plenty of other reasons why you should keep good accurate records:

• If you use software to maintain your accounting records it is always worth keeping original paperwork in case your accountant has any queries
• If HM Revenue & Customs decide to enquire into your tax affairs, you may be required to supply evidence to support the entries on your tax return
• You may need to retrieve a document for business or personal reasons

There are penalties for failing to keep records and also for keeping inaccurate records, so please do get in touch with a member of our team today if you have any questions.  We have experts in our Dalston, Dumfries, Penrith and Workington offices who are happy to help you.