Set your financial records straight! What to keep and for how long
So you think you've got your financial records in order. Did you know there are some financial records you need to keep for up to seven years?
If SARS audits your business, it might request financial records you don't have anymore!
It will then not only doubt your business validity, but you'll face massive penalties or even jail time for up to two years!
But how do you know what to keep and for how long? Don't despair, we have the answers.
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If you hang on to your records and information, it will improve your accuracy when you submit your tax return and also assist with forecasting should you need to issue a payment to SARS.
This applies to all taxpayers, including sole proprietors, companies and close corporations.
Cheques and cheque requisitions;
Creditors' invoices/ statements;
Journal reports; and
General financial files.
General ledger reports;
General personnel files and
Personnel loan records.
Creditors' ledger and debtors' ledger;
Petty cash book;
Offers of employment;
Leave forms; and
Cheque stubs (after annual audit).
Remember to keep your documents off site or make sure that your supporting documents are stored in a safe location. Destruction of documents due to a fire or flood is not an excuse for SARS. Even if it's beyond your control!
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