Retention of accounting and tax records in Canada
Tax rule: 6 years
Businesses must keep their books and records, with supporting documents, for 6 years from the end of the last tax year to which they relate (Income Tax Act, s. 230; Tax Administration Act (Quebec), s. 35). The period is longer if a return was filed late or if an objection or appeal is pending.
What to keep
- sales and purchase invoices, receipts, bank statements;
- general ledger, journals, financial statements;
- GST/QST records;
- payroll records and source deductions;
- contracts, leases, asset registers (for depreciation, keep as long as the asset is owned plus 6 years).
Other obligations
- Corporate records (minute book, registers of shareholders and directors): for the life of the corporation;
- Employment records: the Regulation respecting a registration system under the ALS requires keeping payroll registers for 3 years;
- destruction of records before the deadline requires written permission from the tax authorities.
Electronic records
Records may be kept in electronic form provided they are readable, complete and accessible in Canada (or upon request). Since 2022, documents containing personal information must also be protected and destroyed securely (Law 25).
