How long must I keep my tax records? When can I throw old tax-related documents away? What happens if SARS request supporting documents and I don’t have it anymore? Specific tax laws lay down certain obligations regarding the retention periods of tax-related documentation. This article discusses tax retention periods as set out in the Tax Administration Act (TAA).
Who should keep tax records?
The following persons must keep tax records:
- Anyone who submitted a tax return;
- l Someone who should have submitted a tax return but didn’t;
- l Any person who was not required to submit a tax return because they earned exempted income or taxable income which was below a tax threshold.
How long must records be kept?
A taxpayer who submitted a tax return must keep the relevant records for five years after the return’s submission date.
When a person should have submitted a tax return but didn’t, they must keep tax records until the return is submitted. After the return has been submitted, the records should be kept for five years from the submission date.
If a person was not required to submit a tax return because they earned income which was either exempted or below a tax threshold, such a person must keep their tax records for five years after the last day of the relevant tax period.
Where a person is either aware or has been notified that their tax records will be audited or investigated, such records must be kept for the longest of the following periods:
- Five years from the return’s submission date if a return was submitted;
- Five years from the end of the tax period if the taxpayer was not required to submit a return; or
l Until the audit or investigation has been finalized.
When a taxpayer lodged an objection or appeal against the assessment of a tax return or a decision made by SARS in terms of the TAA, the relevant records must be kept for the longest of the following periods:
- Five years from the return’s submission date if a return was submitted;
- Five years from the end of the tax period if the taxpayer was not required to submit a return; or
- Until the assessment or decision has been finalized.
In what format must records be kept?
Tax records must be kept either in their original form, a form authorized by a senior SARS official for a specific taxpayer upon request from the taxpayer, or the form prescribed by the Commissioner in a public notice.
What happens if records are not kept?
In terms of the TAA, if a taxpayer fails or neglects to keep the required tax records, they have committed a criminal offence and could also be liable for an administrative non-compliance penalty.
SARS inspections
Taxpayers are obliged by law to keep tax records in South Africa available for inspection by SARS. SARS may make unannounced inspections of tax records to determine whether the necessary records have been kept for the specified retention periods. Records must be kept in a safe place, in an orderly way and be open for inspection, audit or investigation by SARS.
This article discussed general retention periods of records as set out in the TAA. The specific tax records to be kept to satisfy SARS requirements are specified in the different tax acts, e.g. the Income Tax Act or the VAT Act. For more information about which specific records must be kept, please consult the relevant acts or your tax practitioner.
Reference List:
Accessed on 23 August 2015:
- SAICA Guide on the Retention of Records (Updated October 2013)
Accessed on 2 September 2015:
- SARS Short Guide to the Tax Administration Act, 2011 (Act No. 28 of 2011) – SARS Version 2
This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE).
