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The Australian Taxation Office has released a record-keeping guide. This guide aims to help you understand what records you need to keep to support your claims this tax time.

Records need to be kept for five years (in most cases), from the date you lodge your tax return. Records may include income statements, payment summaries and receipts. You will receive documents that are important for doing your tax during the income year.

The importance of keeping records

Keeping good records helps you and your JBC adviser to:

  • Provide written evidence of your income and expenses,
  • Prepare your tax return,
  • Ensure you are able to claim all your entitlements,
  • Prove the information you provided in your tax return (in case you are asked by the ATO),
  • Reduce the risk of tax audits and adjustments,
  • Improve communication with us,
  • Resolve issues that relate to a dispute of your assessments or adjustments,
  • Avoid exposure to penalties.

Keeping records helps your adviser reduce time spent sorting and preparing records and will give them more time to ensure you claim your entitlements.

How long to keep your records

The standard amount of time you must keep a record of your written evidence is five years from the date you lodge your tax return.

However, there are specific situations in which the duration of record-keeping may vary, for example:

If you

a) Claim a deduction for decline in value of depreciating assets then you need to keep records for five years from the date of your last claim for decline in value.

b) Acquire or dispose of an asset then you need to keep records for five years after it is certain that no capital gains tax (CGT) event can happen.

c) Are in dispute with the ATO you need to keep records for the later of either:

  • Five years from the date you lodge your tax return
  • Five years from the date the dispute is resolved

Formatting your records

  • Records can be kept in either paper or digital format.
  • Digital copies must be a true and clear copy of the original and it is recommended these copies are backed up.
  • Documents must be in English unless the expense was incurred outside of Australia.
  • Claims for deductions must have records to show how the claims were worked out.

More information on the format of your records is available here.

Examples of records you need to keep

  • Income statements or payment summaries, from your employer and Services Australia.
  • statements from your bank and other financial institutions showing the interest you earn during the income year.
  • Dividend statements.
  • Summaries from managed investment funds.
  • Receipts or invoices for equipment or asset purchases and sales.
  • Receipts or invoices for expense claims and repairs.
  • Contracts.
  • Tenant and rental records.

More information on the records you need to keep is available here.

If you have any questions about any of the above, please do not hesitate to contact your JBC adviser on 6323 7000.

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