Business Records You Need to Keep for HMRC
January 29th 2008
In most cases, HMRC will never see your business records unless you are chosen for an HMRC enquiry. However, since the merger of HM Customs and Inland Revenue, aspect enquiries are becoming more and more common. The larger your business, and the more disorganized your records, the more likely it is that your aspect enquiry will turn into a full enquiry. Additionally, HMRC can charge additional fines if you do not keep the required records. To avoid tax disputes, penalties, and back taxes, you should keep all required records in an organized fashion.
1. You are required to keep VAT records for six years, and all self assessments and tax returns for five years. Make sure these are well organized and stored in a safe place.
2. Keep all records, receipts, and invoices for business expenses. Make careful inventory of any part of your home used for business, and all supplies used in your business if you are self employed.
3. All records relating to employees, salaries paid, taxes deducted, and taxes paid. These records must be meticulous, because they may be required in the event that one of your employees comes under tax enquiry. If your records for that employee are not readily available, you may face enquiry yourself.
4. All records pertaining to dividends paid, income earned for the company, and taxes paid. Basically, anything and everything that you use to calculate your self assessment forms must be kept with your tax records.















