What records should I keep for CRA?

Every business in Canada must keep adequate records to support the amounts reported on tax returns. CRA’s rule of thumb is 6 years from the end of the last tax year — but knowing exactly which records, in what format, and for how long protects you from assessments, penalties, and lost deductions.

How long do I need to keep business records for CRA?

The standard requirement is 6 years from the end of the last tax year to which the records relate. For example, if your corporation’s fiscal year ends December 31, 2025 and records were relevant to that year, keep them until at least December 31, 2031. This applies to all books, accounts, vouchers, and source documents.

What specific records does CRA require businesses to keep?

CRA requires retention of: original invoices and receipts (all income and expenses); bank and credit card statements; payroll records (T4s, payroll registers, employee agreements); GST/HST records (sales records, ITC claims, returns filed); vehicle logbooks; contracts; corporate minutes and resolutions; and shareholder loan account records.

Are digital/electronic records accepted by CRA?

Yes — CRA accepts electronic records provided they are: (1) reproducible in paper form on request; (2) stored in a format readable by CRA’s systems; and (3) backed up to prevent loss. Cloud accounting software records (QuickBooks, Xero, Sage) satisfy these requirements if the underlying data can be exported. Scanned paper receipts stored in a cloud drive are also acceptable.

Can I destroy original paper records if I have digital copies?

Generally yes — CRA’s administrative policy permits destruction of original paper documents once scanned to a reliable digital format. However, certain original documents should be kept physically: signed contracts, shareholder agreements, share certificates, and property deeds. When in doubt, keep the original for high-value or legally significant documents.

What records do I need to keep for vehicle expenses?

To claim vehicle expenses, maintain a mileage logbook showing: the date of each trip, destination, business purpose, and kilometers driven. CRA can deny the entire vehicle deduction if no logbook exists. A simplified logbook method is available — record full details for a minimum 3-month sample period and extrapolate to the full year, provided the driving pattern is consistent.

How long should I keep personal tax records?

For personal T1 returns, keep supporting documents for 6 years: RRSP receipts, charitable donation receipts, medical expense receipts, and tuition tax credit certificates (T2202). If you claimed a capital loss or RRSP contribution, keep those records indefinitely — they carry forward and may need to be traced years later.

What happens if I cannot produce records during a CRA audit?

CRA can use net worth assessments to reconstruct income if adequate records are absent, typically resulting in higher reassessments. Penalties for failure to keep adequate records range from $1,000 to $25,000 per failure under section 239 of the Income Tax Act, plus potential criminal charges in egregious cases.

Reviewed by: Bader A. Chowdry, CPA CA LPA — Insight Accounting CPA Professional Corporation, Mississauga, Ontario. Last reviewed: June 6, 2026.