What counts as a business record, when the CRA’s six-year clock starts, which records you keep longer, how to keep receipts digitally, what happens if records are missing, and the rules for GST/HST, payroll and closing a business, with every rule linked to the CRA or the Government of Alberta.
Generally six years from the end of the last tax year the records relate to. For a corporation, the tax year is its fiscal period; for a sole proprietor, it is the calendar year. Some records are kept longer: records about long-term assets and the share register are kept indefinitely, a late-filed return starts a new six years from the day you file it, and records for an objection or appeal are kept until it is settled. Digital copies are accepted if they meet the CRA’s rules, and destroying records early needs the CRA’s written permission.
What Counts as a Business Record?
The CRA describes records as your organized accounting and financial documents, plus the documents that support each transaction. For a small business that usually means:
- ledgers, journals and financial statements,
- income tax and GST/HST returns,
- sales invoices, purchase receipts, credit card receipts and cash register slips,
- bank statements, deposit slips and cancelled cheques,
- contracts, work orders, delivery slips and logbooks, and
- emails and other correspondence that support your transactions.
A corporation also keeps corporate records: the minutes of directors’ and shareholders’ meetings, the record of who owns its shares and any transfers, the general ledger, and any special contracts needed to understand the ledger.
For each purchase, the CRA’s business records page says the receipt should show the date, the seller’s name and address, your name and address, a full description of what you bought and, when the purchase is $100 or more before tax, the seller’s business number if they are a GST/HST registrant. If a receipt does not describe the item, write the description on it or in your expense journal.
Two expenses need records of their own: a logbook of the kilometres you drive for business, and the size and use of a home office. Our vehicle expenses guide and home office expenses guide each include a checklist of what to keep. For business meals, keep the itemized bill and note who you met and why. Our meals and entertainment guide explains the 50% rule and the records the CRA expects. For a phone or internet plan you also use personally, keep the bills and a note of how you worked out the business share, as our cell phone and internet guide explains.
- Inactive companies count. The CRA says holding companies and inactive corporations still have to keep records.
- Keep them in Canada. Records must be kept at your place of business or your residence in Canada, unless the CRA gives you written permission to keep them elsewhere.
- English or French. The CRA requires records to be reliable, complete, supported by documents and kept in English, French or both.
- You stay responsible. If a bookkeeper, accountant or software provider holds your records, you are still responsible for keeping them and showing them to the CRA when asked.
When Does the Six-Year Clock Start?
The CRA’s general rule is that you keep all required records and supporting documents for six years from the end of the last tax year they relate to. The same rule applies under the Income Tax Act, the Excise Tax Act (GST/HST), the Employment Insurance Act and the Canada Pension Plan.
The clock starts at the end of the tax year, not on the date of the receipt. For a corporation, the tax year is its fiscal period, so a March 31 year-end moves every date. For individuals, including sole proprietors, it is the calendar year. Under the Employment Insurance Act and the Canada Pension Plan, the period starts at the end of the calendar year the records relate to (Information Circular IC78-10R5).
Here is how the general rule works out, assuming no other rule below applies:
| Records for | Six years end |
|---|---|
| A corporation’s fiscal year ended December 31, 2020 | December 31, 2026 |
| A corporation’s fiscal year ended March 31, 2021 | March 31, 2027 |
| A sole proprietor’s 2020 calendar year | December 31, 2026 |
| 2020 payroll records (CPP and EI) | December 31, 2026 |
| A 2020 return that was filed late, on June 1, 2022 | June 1, 2028 |
Watch the words “last tax year”. A record that matters in more than one year, such as the purchase invoice for equipment you claim capital cost allowance on for years, relates to every one of those years. IC78-10R5 says the period is set by the last tax year a record may be needed, not the year it was created.
Which Records Do You Keep Longer Than Six Years?
The CRA’s retention page lists the situations where the period is different. These are the ones a small business is most likely to meet:
Keep indefinitely
- Records of buying and selling property you hold for the long term
- The share register and other history that affects a sale, liquidation or wind-up
Six years from the day you file
- Not from the end of the tax year
- The later you file, the longer you keep the records
Until it is settled
- Until the objection or appeal is resolved and the time for a further appeal has passed
- And never less than the six-year period
As long as the CRA says
- A CRA official can tell you to keep records longer than six years
- You are told in person or by registered mail
Long-term asset records are the ones people throw out too early. The cost of a building, a vehicle, equipment or shares is needed again when you sell, often many years later. The CRA says to keep them indefinitely, and IC78-10R5 explains why: the period runs from the last tax year in which the purchase could enter any tax calculation, which for an asset is usually the year you sell it.
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Can You Keep Receipts and Records Digitally?
Yes. The CRA accepts records kept on paper, on paper and later converted to an accessible and readable electronic format, or in an electronic format from the start. Two rules catch people out:
- Electronic records stay electronic. A record created electronically, such as an emailed invoice or a bank download, has to be kept in an electronic readable format, even if you also print it.
- Scanning paper has a standard. The image must be an accurate copy meant to take the place of the paper, show the same information, and not hide significant details. If your imaging meets the Canadian General Standards Board standard, the images become the permanent records and you can destroy the paper. If it cannot meet that standard, keep the originals. The CRA suggests getting legal advice if you are in any doubt about destroying paper records.
The CRA says to store proper backup copies, preferably at a site in Canada other than your business location. If electronic records are lost, destroyed or damaged, you have to report it to the CRA and recreate them within a reasonable time.
Where the data sits matters too. The CRA says records kept outside Canada and accessed electronically from Canada are not records kept in Canada. To keep them elsewhere you need the CRA’s written permission, and the CRA may then accept copies that are true copies, available in Canada in a format its software can read.
Changing accounting software? Information Circular IC05-1R1 says a change of system or service provider must not cause a loss of the information you need for tax, and the old records must stay accessible. Export and keep the old data in a readable format before you close the old account.
- Check the year. Has the last tax year it relates to been over for six years?
- Check what it is. Asset, share and objection records follow longer rules.
- Check the scan. Is every image clear, complete and backed up? If your imaging does not meet the standard, keep the paper.
What Happens If You Do Not Keep Records Long Enough?
If the CRA asks to see records you no longer have, claims your records do not support can be disallowed. If the CRA cannot work out your income from your records, it will use other methods to estimate your income and GST/HST, which the CRA notes will cost you time.
Under IC78-10R5, if your records are inadequate the CRA can tell you in writing which records to keep, and follows up to check. Failing to keep adequate records or to provide them can lead to prosecution. The circular (dated June 2010) describes a fine of not less than $1,000 on summary conviction, and possible imprisonment, on top of any other penalty. Destroying records to evade tax is prosecuted as tax evasion.
Destroying records before the end of their period without the CRA’s permission is itself a risk: the CRA says you may be prosecuted.
How Long Do You Keep GST/HST and Payroll Records?
GST/HST. The same six-year rule applies under the Excise Tax Act. Your GST/HST records must describe what you bought and sold in enough detail to work out the tax, and you keep the purchase invoices or receipts behind every input tax credit you claim. If you never filed a GST/HST return for a period that ended more than six years ago, you still have to file it and keep the records that support it.
Payroll. Employers keep the hours worked by each employee, the CPP, EI and income tax withheld, each employee’s TD1 form, any CRA letters of authority, and every information slip and return filed. The CRA’s employers guide says to keep paper and electronic payroll records for at least six years after the year to which they relate.
Alberta employment records. The Government of Alberta says employers must keep employment records for 3 years under the Employment Standards Code. That is a separate, shorter rule. It does not shorten the CRA’s six years for the same payroll records, and the CRA’s permission to destroy records only covers records it requires, not records other laws require.
What If You Close Your Business or Dissolve Your Corporation?
The rules are in the CRA’s retention page and IC78-10R5:
- Sole proprietorship or partnership that ends: keep the records for six years from the end of the tax year in which the business ended.
- Corporation that is dissolved: keep all records and supporting documents, including the minutes, share records and general ledger, for two years after the date of dissolution.
- Corporations that amalgamate: the new corporation usually keeps the records of each amalgamated corporation for six years from the end of the tax year they relate to.
To destroy records before their period ends, you first need written permission from the CRA. You can use Form T137, Request for Destruction of Records, or write to your tax services office.
How Can We Help Keep Your Records in Order?
Our monthly bookkeeping records every transaction in cloud accounting software and reconciles it to your bank and credit card statements each month, so your records are complete and in order year by year. Our payroll service handles source deductions, T4 slips and records of employment. Fees are fixed and quoted up front.
See our bookkeeping and payroll services, or, if you have a box of old records and are not sure what you can let go, see our packages.
Frequently Asked Questions
How long should a small business in Canada keep its records?
Generally six years from the end of the last tax year the records relate to. Records about long-term assets and the share register are kept indefinitely, and a late-filed return restarts the six years from the day you file it.
Can I throw away paper receipts after I scan them?
Only if your scans meet the CRA’s imaging rules. The image has to be an accurate, complete copy, and the CRA refers to the Canadian General Standards Board standard. If your imaging cannot meet it, keep the paper. Receipts you received electronically must be kept electronically.
Does an inactive or holding company still have to keep records?
Yes. The CRA says holding companies and corporations that are inactive still have to keep records.
Can my bookkeeper or accountant keep my records for me?
Yes, but you are still responsible for them. The records must be protected, kept for the full period and made available to the CRA when it asks, even if a third party holds them.
Can I destroy records before the six years are up?
Only with the CRA’s written permission. Use Form T137, Request for Destruction of Records, or write to your tax services office. Destroying records early without permission can lead to prosecution.
Reviewed on 24 October 2026. Record-keeping periods, formats, payroll and GST/HST record rules in this article are from the Canada Revenue Agency and the Government of Alberta, linked beside each fact and listed below.
Bookkeeping
Monthly bookkeeping with bank and credit card reconciliation, monthly reports and GST/HST filing included
Payroll
Payroll for Canadian small businesses: direct deposit, source deductions, T4 and ROE filing
Sources
- Canada Revenue Agency, Where to keep your records, for how long and how to request the permission to destroy them early (page dated 2026-08-03, checked 23 October 2026)
- Canada Revenue Agency, What are records, who has to keep them, and why it is important (page dated 2025-06-17, checked 23 October 2026)
- Canada Revenue Agency, Your responsibilities and the requirements associated with records the law requires you to keep (page dated 2025-06-17, checked 23 October 2026)
- Canada Revenue Agency, Specific information that certain entities have to keep (page dated 2025-06-17, checked 23 October 2026)
- Canada Revenue Agency, Business records (page dated 2026-08-31, checked 23 October 2026)
- Canada Revenue Agency, Acceptable format, imaging paper documents and backing up electronic files (page dated 2026-08-03, checked 23 October 2026)
- Canada Revenue Agency, GST/HST and payroll records (page dated 2026-03-05, checked 23 October 2026)
- Canada Revenue Agency, Employers’ Guide, Payroll Deductions and Remittances (T4001), Keeping records (page dated 2026-01-21, checked 23 October 2026)
- Canada Revenue Agency, Information Circular IC78-10R5, Books and Records Retention/Destruction (June 2010) (page dated 2020-02-24, checked 23 October 2026)
- Canada Revenue Agency, Information Circular IC05-1R1, Electronic Record Keeping (page dated 2020-02-24, checked 23 October 2026)
- Canada Revenue Agency, Form T137, Request for Destruction of Records (page dated 2025-12-04, checked 23 October 2026)
- Government of Alberta, Employment standards rules: payment of earnings (employment records) (no page date shown, checked 23 October 2026)
