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Your accounting and tax records need to stay with you for six years from the end of the last tax year they relate to, unless the CRA gives you permission to destroy them sooner. That’s the rule for businesses, and it covers paper and electronic files alike.
Six years is a long time to hold a shoebox. Still, a tidy system takes less effort than it sounds, and it pays for itself the first time the CRA, your accountant or your own memory asks you to prove a number from three years back.
Keep your records for six years from the end of the last tax year they relate to
Keeping Records (RC188), Canada Revenue Agency, canada.ca
What counts as a record?
The CRA’s list is broad: ledgers, journals, financial statements, returns, correspondence, charts and tables. It also covers anything held in accounting software, a point-of-sale system or an online purchasing platform. Then there are the source documents, the invoices and receipts and bank statements that back up each line in the books.
Notice what that means for a small operator. A spreadsheet with no receipts behind it is only half a record. And a folder of receipts with no ledger is the other half. You need both. Simple as that.
Keeping your accounting and tax records straight
| Question | What the CRA says |
|---|---|
| How long to keep records | Six years from the end of the last tax year they relate to |
| Electronic records | Keep them with the same care as paper, including data from internet-based systems |
| Where to keep them | At your Canadian residence or place of business, unless the CRA permits otherwise |
| Destroying early | Only with the CRA’s permission |
| If someone else keeps your books | You’re still responsible for adequate records |
That last line catches people out. Hiring a bookkeeper doesn’t hand the duty over. If the bookkeeper vanishes, or their software subscription lapses and the data goes with it, you’re the one the CRA asks. So download a full copy every year, and keep it yourself.
What a missing receipt costs
Here’s the cost in dollars. Say you’re self-employed in Ontario and you show $50,000 of net income after $10,000 of expenses. The income tax calculator, with $50,000 in the self-employment field, gives $5,962 of income tax and $5,534 of CPP, so $11,496.
Now the receipts go missing and the expenses can’t be supported. The net income is $60,000 in effect, and the tool shows $7,879 of income tax and $6,724 of CPP, so $14,603. The difference is $3,107 on $10,000 of expenses, about 31 cents on each dollar you can’t prove.
The self-employed tax calculator gives a quicker estimate, though the figure may differ a little because it treats some items its own way. If you pay tax during the year, the tax instalments calculator shows what those payments might be.
What if you lose records?
It happens, with a flood, a dead laptop or a bookkeeper who has gone quiet. Don’t guess and don’t wait. Rebuild what you can: ask your bank for old statements, ask suppliers and clients for copies of invoices, and pull sales and payroll history from your software. Then tell your accountant what’s gone before the CRA asks. A reconstructed file with honest notes is a much better place to stand than a gap you hoped nobody would notice. We couldn’t find an official page on what the CRA accepts in place of lost receipts, so ask a professional about your own case.
A simple system that works
Pick one place for each kind of paper. Stick with it, even in a busy week at tax time. Photograph receipts the day you get them. Name the files with the date and the vendor. Reconcile the bank account every month, and the job stays small. Once a year, after you file, close the year: save a full export from your accounting software, label a folder with the tax year and the date it can go, and put a reminder in your calendar six years out. That one habit answers most of the questions you’ll ever get about old paperwork.
If you collect GST/HST, keep the invoices that show the tax. The GST/HST calculator lets you check the tax on a price before you post it. If you have staff, the payroll remittance calculator covers what to set aside, and the pay records belong in the same six-year file.
Mistakes with accounting and tax files
Mixing personal and business spending in one account is the most common. It’s legal, but it makes every review slower, and it makes it harder to say what each charge was for. Another is keeping only the bank statement. A statement shows that money moved, but not what it bought, and the invoice is what proves the expense.
The next one is binning files by the calendar. The clock runs from the end of the last tax year they relate to, so records for the 2025 tax year stay until the end of 2031. When in doubt, keep them another year.
And moving records abroad, or to a cloud account you don’t control? The CRA’s rule says to keep them at your Canadian residence or place of business unless you have permission. We couldn’t confirm how the CRA treats cloud storage on that point, so ask before you rely on it.
Our sources
The record rules come from the Canada Revenue Agency‘s Keeping Records guide (RC188), read in September 2026. The Ontario income tax and CPP figures come from our 2026 tax data. We’re an independent site, and no government body is behind it.
Frequently asked questions
How long must I keep business records for the CRA?
Six years from the end of the last tax year they relate to, unless the CRA gives you permission to destroy them earlier.
Do digital records count?
Yes. The CRA expects computerized records, including those from accounting software and online systems, to be kept as carefully as paper.
If my bookkeeper keeps the books, who is responsible?
You are. The CRA says you're responsible for adequate records even when a bookkeeper or accountant keeps them for you.
Can I store records outside Canada?
The CRA says to keep them at your Canadian residence or place of business unless you have permission to keep them elsewhere.
What does a lost expense cost me?
In our Ontario example, $10,000 of unproven expenses on $60,000 of self-employed income adds $3,107 of income tax and CPP.
- Self-employed taxes in Canada: income, CPP and GST
How tax works when you are self-employed in Canada: reporting income and expenses, paying both halves of CPP, instalments and when to register for GST