If you run a business or file a self-assessment tax return, the admin often creeps up on you. Receipts in email folders, invoices in a spreadsheet, bank statements in a portal, and no clear system when HMRC comes calling. That is where good HMRC record keeping stops being a “nice to have” and becomes essential protection for you and your business. 

In this guide, we walk through what records you need to keep for HMRC, how to organise your business records for tax, and how long you should keep everything so you can face any HMRC enquiry with confidence. 

As a full-service accountancy firm, Carter Collins & Myer supports individuals, sole traders, SMEs, and growing companies across the UK, helping them stay compliant, organised, and confident in their financial record-keeping. With more than 100 years of combined partner experience, we specialise in simplifying tax, bookkeeping, payroll, VAT, and year-end responsibilities so you always know exactly where you stand.  

Call us on 01706 225 617 or email enquiries@uk-ccm.com for a free consultation. 

 

How HMRC Records Fit Into Everyday Business Life 

Most people do not wake up excited about spreadsheets and filing. We see it all the time: busy owners and individuals doing their best, then suddenly worrying about HMRC record-keeping when a deadline or a brown envelope appears. 

How Record Keeping Slips In Real Life 

In practice, gaps appear because: 

• You focus on serving customers first, admin later. 

• Different systems hold different parts of the picture, such as bank feeds, invoicing apps, emails, and paper receipts. 

• No one has defined “what counts” as proper business records for tax. 

• You assume your software will automatically cover everything HMRC needs. 

Nothing feels urgent until you ask yourself What records do you need to keep for HMRC if they decide to review a year from now, or even six years from now. 

Why A Simple System Beats A Perfect One 

The ideal is not a colour-coded archive that takes hours every week. What works best is a simple, repeatable system that: 

• Captures every transaction once, in a clear place. 

• Links back to bank statements and invoices. 

• Lets you quickly answer questions like how long to keep tax records and where they actually live. 

At Carter Collins & Myer, we design record systems that match how you already work, then tighten them just enough to meet HMRC expectations without adding unnecessary admin.  

Essential HMRC Records Every Taxpayer Must Maintain 

Now, to the heart of it, what records do you need to keep for HMRC in practical terms? HMRC looks at the story behind your numbers. That story lives in different record categories, depending on how you operate. 

1. Records For Self-Employed And Sole Traders 

If you are self-employed, your HMRC record-keeping must clearly show your income and expenses. Typically, you should keep: 

• Sales records, invoices issued, online sales reports, and till summaries. 

• Purchase records, supplier invoices, receipts, and online purchase confirmations. 

• Bank statements and credit card statements that match your business activity. 

• Mileage logs or travel records where you claim business journeys. 

• Details of assets, laptops, vehicles, and equipment that you claim as capital allowances. 

These are your core business records for tax; they back up the figures on your self-assessment return, and help if HMRC questions a particular claim. 

2. Records For Limited Companies 

For limited companies, the list gets wider because HMRC and Companies House expect more structure. You should keep: 

• Formal accounts, management reports, and year-end financial statements. 

• Detailed ledgers of sales and purchases. 

• Bank reconciliations confirm that your accounts match the bank records. 

• Director loan accounts and evidence of money directors put in or take out. 

• Board minutes and decisions that affect pay, dividends, and major purchases. 

These documents support your corporation tax returns and demonstrate that your company’s tax records are accurate and complete. 

3. VAT Records You Must Keep 

If you are VAT-registered, there are additional HMRC record-keeping rules. You need to keep: 

• VAT invoices issued and received, searchable by VAT number and date. 

• VAT account summaries that show the VAT you owe or reclaim each period. 

• Records of any adjustments or special VAT schemes used, such as flat rate or margin schemes. 

Digital storage is usually expected under Making Tax Digital; however, the key is that HMRC can follow the trail from individual transactions to the VAT return. That is another area where clients ask us how long to keep tax records, because VAT records typically need to be accessible for at least six years. 

4. Payroll, PAYE And Employee Records 

If you employ staff, HMRC expects you to keep complete payroll records, including: 

• Employee details, contracts, and starter or leaver forms. 

• Gross pay, tax, National Insurance, and pension deductions for each pay period. 

• Real Time Information submissions sent to HMRC. 

• Records of benefits in kind and any P11D information. 

5. CIS And Construction Industry Records 

If you are in construction and fall under the Construction Industry Scheme, you also need: 

• Subcontractor verification records. 

• Monthly CIS returns and payment statements. 

• Evidence of deductions taken from subcontractors and totals paid over to HMRC. 

6. Personal Tax, Property And Investment Records 

Individuals who complete self-assessment, especially those with property or investment income, should keep: 

• Rental statements and tenancy agreements. 

• Records of repairs, services, and allowable property expenses. 

• Buying and selling records for shares, funds, or other investments. 

• Interest statements from banks and savings accounts. 

When clients ask what records you need to keep for HMRC as an individual, the rule of thumb is simple: keep anything that supports the figures on your return and helps you explain how you arrived at them. 

7. Digital Records, Software And Making Tax Digital 

Most businesses now use accounting or payroll software, which helps with HMRC record keeping, but does not replace it. You still need to: 

• Make sure data entry is accurate and timely. 

• Store digital copies of invoices and receipts so they are easy to retrieve. 

• Check how your software backs up data and how long to keep tax records within those systems. 

Our switch-over service is popular with clients who want to move to a better system without losing historic records or falling foul of HMRC requirements. 

8. Practical Tips To Stay Organised And Compliant 

Once you understand what records you need to keep for HMRC, the next step is to stay on top of everything without drowning in admin. A few practical habits make all the difference. 

9. Set A Simple Weekly Record Routine 

Rather than leaving everything to year-end, set aside a short, regular slot each week to: 

• Upload receipts into your software or cloud folders. 

• Match bank transactions against invoices and expenses. 

• Check that recent business records for tax are complete, not half-finished. 

This keeps things tidy and reduces the stress that often leads to mistakes. 

10. Agree on Retention Rules And Stick To Them 

For most businesses, the safe approach for how long to keep tax records is at least six years, sometimes longer if you are dealing with assets or property. Decide, write it down, and make sure your team and systems follow the same rules for every document. 

Stay HMRC Compliant With Carter Collins & Myer 

Organised records protect you, support better decisions, and make tax time far less stressful. Understanding HMRC record-keeping and putting a simple system in place means you always know which documents to save, where they live, and how long to keep tax records, without second-guessing yourself. 

If you are unsure whether your current approach is strong enough, or if you feel overwhelmed by business records for tax, we can help. At Carter Collins & Myer, we bring decades of experience, up-to-date knowledge of HMRC requirements, and a friendly way of explaining what needs to happen next. Our qualified team supports clients across many sectors and sizes, and our long-standing relationships reflect the trust they place in us. 

Contact us today for a free consultation on 01706 225 617 or email enquiries@uk-ccm.com. Our specialists will review your current system, suggest practical improvements, and ensure your records are robust enough for any HMRC enquiry.