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To store your accounting records outside of South Africa, you must meet SARS' five requirements

by , 28 January 2015
SARS is very strict when it comes to your accounting records.

Not only does it want you to keep them for a specific time, it's also strict about where you keep them. Your records must be in South Africa.

But, if due to your business operations, you need to store some of your records outside the country so you can access them, you must first meet its five requirements.

Read on to find out what they are so you can comply.


Five SARS requirements you must meet to store your accounting records outside of South Africa

 
A senior SARS official will let you to store your accounting records outside of South Africa if:
 
1. You can access the electronic system from your physical address within South Africa for a minimum of five years;
 
2. The location of your records doesn't affect your access to them;
 
3. There's an international tax agreement for mutual assistance in the administration of taxes in place between you and the country that's storing your records. (You can get a list of countries that South Africa has agreements with on the SARS website.)
 
4. You maintain your records in the correct format. To find out what SARS means by 'the correct format', check out the Practical Accountancy Loose Leaf Service; and
 
5. You can supply SARS with an acceptable electronic form of your records within a reasonable time. SARS will determine what an acceptable time is.
 
Now that you know what SARS' requirements are, here's a reminder of the accounting records you need to keep…

 
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Keep these seven accounting records to comply with SARS

 
You must keep your:
 
  1. Cash book (records cash transactions);
 
  1. Debtors ledger (records transactions with specific debtors)
 
  1. Debtors list (a list of all debtors with outstanding balance and aging);
 
  1. Creditors ledger (records transactions with specific creditors);
 
  1. Creditors list (a list of all creditors with outstanding balance and aging);
 
  1. Sales ledger (records sales transactions); and
 
  1. Inventory listings (records of all inventories on hand).
 
Keeping these records won't only help you comply with SARS when it wants to audit your past tax returns. They will also help you:
 
  • Comply with the Companies Act;
  • Prepare financial statements;
  • Monitor and review business performance;
  • Comply with the various tax acts;
  • Protect yourself and third parties who do business with you; and
  • To get funding.
 
So make sure you keep them. And if you want to store them outside of South Africa, meet SARS' requirements now that you know what they are.
 
PS: For more information on record-keeping, check out the Practical Accountancy Loose Leaf Service.
 

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