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How Long to Keep Business Records

how long do you need to keep business records

As a businessman or businesswoman, it is very important for you to keep all the records with regard to your business.

By doing this, you will always have something to present to anything which needs reference.

If there are also things which need to be reviewed or proven, your documents will serve as strong evidences. But if you are wondering on how long you should keep all your documents before they got filed up in your office, then you better read this article in order for you to know the answer.

Before you decide to throw all your documents, you must be sure first to identify them. If a certain document has monetary information just like loan statements and paystubs, then it is classified as a financial document. In business, a financial document is considered very important because of the fact that it will be used for financial auditing. So, keep it for several years in a secured place. Other forms of documents which you need to identify well are personal, education, contractual and identification.

What You Need to Know in Keeping Business Records

It requires one year for the keeping of your financial documents such as bills, bank statements, income and expenses. But before you dispose any kind of financial document, you must first examine if they are for taxing purposes. Receipts must also be kept well in

a span of 10 years because this will still need to be audited.

The following are the other types of business records which you need to keep for future reference purposes: assets, gross receipt, price of the sold goods, expense records, invoices, bank deposits, canceled checks, bank statements and vendor account statements as well. The assets acquisition needs to be separated in record keeping because this will deal on the calculation of depreciation from all your records.

When it comes to identification documents, you need to keep them as long as you live because they are so important. These come in the form of driver’s license and birth certificate which proves the birth name and age of an individual. Wherever you go, you must bring a driver’s license with you especially if you are driving your car because this will always be requested by the authorities.

Since you are engaging in a certain business, you will be having lots of contracts with other entities so you also need to keep lots of contractual documents. These are written agreements between you and a third party upon exchanging goods and services. The goods or services may pertain to any type of property such as a car or a house which requires property deeds or lease agreements. Whatever kind of contractual document you have, it will mature or get terminated for a given date.

Category: Personal Finance

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