Find Out How Long to Keep Business Documents (CRA Guidelines)

How long should you keep business documents in Canada?

For most business and tax records, he Canada Revenue Agency (CRA) requires you to keep records for six years from the end of the last tax year they relate to. That includes records supporting your business income and expenses, such as invoices, receipts, bank statements, contracts and other financial documentation.

However, not every business document has the same retention requirement, and there are situations where records need to be kept longer.

This guide explains the current CRA requirements, what business records you should keep, whether you can store records electronically and what to do when documents reach the end of their required retention period.

How Long To Keep Business Documents – 6-7 Years

The general CRA requirement is six years from the end of the last tax year the records relate to. For example, records relating to your 2026 tax year would generally need to be retained through the end of 2032.

There are exceptions, however, and some records may need to be retained for longer.

You should also remember that CRA guidelines are not necessarily the only rules that apply to your records. Other federal, provincial, territorial, municipal or industry-specific requirements may require certain documents to be kept for different periods. For that reason, businesses should establish a documented records retention schedule based on the types of information they maintain rather than applying one destruction date to every document.  (source).

Business Records Retention at a Glance

This is general information only. Retention requirements can vary depending on the record, business and legislation that applies. Consult the CRA and your legal or accounting adviser when establishing your organization’s retention schedule.

What Are Business Documents?

The CRA requires businesses to keep records of their transactions that support their income and expense claims (source). Business records can include both accounting records and the source documents used to support those records.The CRA also notes that you should not send these records with your tax returns, but instead keep them on file in case of an audit or you are asked to provide them in the future (source).

Examples include:

• Sales invoices
• Purchase invoices and receipts
• Contracts and agreements
• Bank statements
• Deposit slips
• Cancelled cheques
• Credit card receipts
• Financial statements
• Tax returns
• GST/HST returns
• Work orders
• Delivery slips
• Logbooks
• Emails and correspondence relevant to business transactions

Records can exist in paper or electronic format, and businesses are responsible for ensuring they remain complete, reliable, accessible and readable throughout the applicable retention period.

Income Records

Business owners must keep records supporting their gross income. Your records should identify the amount received, the date it was received and the source of that income. Supporting documents may include:

• Sales invoices
• Contracts
• Receipts
• Bank deposit slips
• Statements
• Other records showing the source of business income

The CRA also requires businesses to maintain records of their daily income and expenses and to keep separate records for each business they operate.

Source: The Government of Canada.

Expense Records

Businesses should retain documents supporting the expenses they claim. These may include:

• Supplier invoices
• Receipts
• Credit card receipts
• Contracts
• Purchase records
• Bank records
• Other proof of payment

Your records should contain enough information to identify what was purchased, when it was purchased and the supplier. Good expense records don’t just help with CRA compliance. They also help ensure your business can substantiate deductions and input tax credits it is entitled to claim.The receipt or purchase document should include a variety of information such as the date of purchase, the name and address of the seller or supplier, and more.

Source: The Government of Canada.

Property and Capital Asset Records

Records relating to property and capital assets can require special consideration because they may remain relevant long after the original purchase.

These records can include:

• Purchase agreements
• Invoices
• Closing documents
• Records of improvements
• Sale documents
• Information showing when an asset was acquired
• Information showing its original cost

These documents may be required to establish the cost of an asset, calculate capital cost allowance (the deduction you can claim over year-long periods for the cost of depreciable property – source) or determine a gain or loss when the property is eventually sold. Because these records can have a longer useful life than ordinary expense receipts, don’t automatically destroy property records simply because six years have passed.

Source: The Government of Canada.

Why Is It Important To Keep Business Documents?

Good record keeping is important for more than simply complying with a retention period. The CRA identifies several reasons complete and organized records matter. Not keeping proper records can result in audits and possible legal action.

Support Your Income and Expenses

Your records provide evidence supporting the income, deductions and tax credits reported by your business.If your documentation does not support a claim, that claim could be disallowed. Records can come in paper or electronic form as long as they include all supporting documentation (source).

Be Prepared for a CRA Review or Audit

The CRA can request access to records when reviewing or auditing a business. Your records must be available when requested, including relevant electronic records and information maintained by third-party providers.

Understand Your Business

Organized records can also help you understand your company’s financial position, compare performance between years, identify trends and prepare budgets and forecasts.

Meet Your Other Legal Obligations

CRA requirements should be considered alongside other legislation and industry requirements that apply to your organization.

A proper retention schedule helps ensure records are kept for as long as required, but not indefinitely without a business or legal reason.

Can Business Records Be Stored Electronically?

Yes. The CRA accepts business records in paper and electronic formats, provided the records meet its requirements. Electronic records must remain accessible and readable throughout the required retention period. If records were originally created electronically, they must be retained in an electronically readable format. Businesses should also maintain appropriate backups so records can still be accessed if files are accidentally deleted, corrupted or lost.

Using a third-party software provider, accountant or records management company does not remove your responsibility for the records. Your business must still be able to provide the CRA with the required information when requested.

Can I Scan Business Documents and Destroy the Paper Originals?

In some circumstances, yes. This is an important distinction for businesses trying to reduce the amount of physical paperwork they store. The CRA allows paper records to be converted to electronic images. However, simply taking a quick photo or scanning a document does not automatically mean you should destroy the original. The electronic image must meet CRA requirements and applicable Canadian standards for reliability, integrity and authenticity.

The CRA states that when paper records have been properly imaged in accordance with the applicable Canadian General Standards Board standards, the electronic images can become the permanent records and the original paper documents can be destroyed. If your organization cannot meet those imaging requirements, the original paper documents should be retained.

For businesses with large volumes of physical records, a properly designed document scanning and imaging program can reduce physical storage requirements while maintaining access to required information.

Where Should Business Records Be Kept?

The CRA generally requires business records to be kept at your place of business or residence in Canada unless you have permission to keep them somewhere else. An important consideration for businesses using cloud-based systems is that records stored outside Canada and merely accessed electronically from Canada are not considered to be records kept in Canada. If you use an accountant, software platform, cloud provider or third-party records management company, you remain responsible for ensuring your records meet CRA requirements and can be provided when requested.

What Happens When the Retention Period Ends?

Keeping records securely is only half of good records management. Businesses also need a process for identifying records that have reached the end of their required retention period and securely disposing of information they no longer need.

Before destroying records, confirm that:

• The applicable CRA retention period has expired
• The records are not subject to another legal or regulatory retention requirement
• There is no current audit, investigation, litigation or other reason the records need to be preserved
• The documents are not subject to an internal legal hold
• There is no ongoing business reason to retain them

If records are no longer required, confidential paper documents should be securely destroyed rather than placed intact into regular garbage or recycling. Electronic records should also be securely disposed of according to your organization’s information security and records management policies.

Can You Destroy CRA Records Before Six Years?

Not without permission. If you want to destroy records before the required CRA retention period has expired, you must obtain written permission from the CRA. Businesses can request permission using Form T137, Request for Destruction of Records, or apply in writing to their tax services office. CRA permission only applies to records required under legislation administered by the CRA. It does not override retention requirements imposed by other federal, provincial, territorial or municipal laws.

Storing and Disposing of Documents – Best Practices

Keeping everything indefinitely isn’t an effective records management strategy.

A better approach is to know what you have, why you’re keeping it, where it’s stored and when it should be destroyed. According to the CRA, organization is not just suggested – it is required. Here are some tips for do-it-yourself document organization:

• Establish a Records Retention Schedule: Create a documented retention schedule identifying the types of records your organization maintains and how long each category needs to be retained.
• Organize Records Consistently: Use consistent naming, filing and classification systems so documents can be retrieved when required.
• Protect Confidential Information Paper and electronic records containing confidential information should have appropriate safeguards against unauthorized access.
• Maintain Reliable Backups: Electronic business records should be backed up and recoverable throughout their required retention period.
• Review Records Regularly: Don’t wait until storage rooms and filing cabinets are overflowing. Regular records reviews help identify documents that have reached the end of their retention period.
• Securely Destroy Records When They’re No Longer Required: Once a record has reached the end of its retention period and there is no legal or business reason to retain it, securely destroy it according to your organization’s records management policy.

Should Businesses Keep Everything for Seven Years?

Not necessarily. “Keep everything for seven years” is a common rule of thumb, but it oversimplifies business records retention in Canada. For CRA purposes, the general requirement is six years from the end of the last tax year the records relate to. Some records may need to be kept longer, while others may be governed by entirely different retention requirements. A formal retention schedule is a much better approach than assigning every business document the same seven-year destruction date.

Professional Document Management Companies

As businesses grow, managing years of paper and electronic records can become increasingly difficult.

A professional records management program can help organizations:

• securely store physical records
• Maintain an organized inventory of stored documents
• Retrieve records when required
• Apply documented retention schedules
• Scan and digitize appropriate records
• Securely destroy documents once retention requirements have been met

This helps businesses avoid both sides of the records management problem: destroying information too early and keeping confidential information longer than necessary.

Blue-Pencil provides secure Records Management, Document Scanning and Shredding services for businesses throughout Toronto and the GTA. When documents reach the end of their approved retention period, Blue-Pencil can securely destroy them and provide a Certificate of Destruction documenting the process.At Blue-Pencil, our office shredding programs offer clients the opportunity to contract their documentation destruction management and ensure that everything will be handled securely and properly destroyed and recycled.

Keep Business Documents Organized With Blue-Pencil!

Blue-Pencil helps empower Canadian organizations to reach new heights with friendly and efficient document management services. Located in Oakville, we have grown our document security business over the past 20 years, serving more than 20,000 organizations including small and medium-sized companies as well as Fortune 500 businesses.

Blue-Pencil can help with Documents Storage and Records Management  and Document Imaging and Scanning Solutions. This allows us to offer full circle, comprehensive solutions for information security management. We service the GTA and surrounding cities –  click here for a full list of our service areas. If you’d like to learn more about us and what we can do for you contact us today!

Frequently Asked Questions About Business Record Retention in Canada

How many years does the CRA require businesses to keep records?

The CRA generally requires businesses to keep records for six years from the end of the last tax year they relate to.

Should I keep business records for six or seven years?

The CRA’s general requirement is six years from the end of the relevant tax year. Seven years is sometimes used as a conservative rule of thumb, but it is not the CRA’s general statutory retention period.

Can the CRA ask for records older than six years?

Some records and circumstances have different retention requirements, so businesses should not assume every document can automatically be destroyed once it reaches six years.

Can I keep CRA records electronically?

Yes. CRA accepts electronic records provided they meet its requirements and remain accessible and readable throughout the required retention period.

Can I destroy paper records after scanning them?

Potentially. Paper records that have been properly imaged according to CRA requirements and applicable Canadian standards can be retained electronically, allowing the paper originals to be destroyed. If you’re unsure whether your imaging process meets those requirements, seek professional or legal advice before destroying the originals.

Do I need permission to destroy business records early?

If the records are still within the CRA’s required retention period, you must obtain written permission from the CRA before destroying them.