Good record keeping is more than just a best practice—it’s a legal obligation for Australian businesses. Whether you’re a sole trader, partnership, or company, the ATO expects you to maintain accurate, complete records for every financial transaction. At Indigo Bookkeeping, we help businesses stay compliant, organised, and audit-ready.
Here’s what you need to know.
Why Record Keeping Matters
Record keeping isn’t just about tax time. Well-maintained records help you:
- Track the health of your business
- Make informed financial decisions
- Claim all eligible deductions
- Avoid ATO penalties or audits
Legal Requirements: What the ATO Says
The Australian Taxation Office (ATO) requires businesses to:
- Keep records for at least five years
- Ensure records are in English or easily converted to English
- Make records accessible and legible on request
What Records You Must Keep
Depending on your business type and structure, you may need to keep records such as:
1. Sales and Income
- Tax invoices
- Receipts or dockets
- Cash register tapes and bank deposit books
- Records of online sales
2. Purchases and Expenses
- Purchase receipts and supplier invoices
- Credit card statements
- Petty cash records
- Logbooks for vehicle use
3. Employee and Contractor Records
- Payslips and payroll summaries
- Superannuation contributions
- Tax file number declarations
- Work hours and leave entitlements
4. Bank Records
- Statements for business accounts
- Loan agreements
- Merchant account summaries (e.g. EFTPOS, PayPal)
5. Asset and Depreciation Records
- Asset purchase records
- Depreciation schedules
- Insurance valuations
6. GST and BAS Records
- BAS lodgements
- GST calculations and payment evidence
Digital or Paper? Both Are Fine—With Conditions
You can store records electronically or in paper form, but they must be:
- Securely stored
- Accurately reproduced (e.g., scans must be clear and unchanged)
- Backed up regularly (especially if using cloud systems)
Penalties for Non-Compliance
Failing to meet record-keeping obligations can result in:
- ATO penalties
- Interest charges on unpaid tax
- Difficulty defending yourself in the event of an audit
Indigo Bookkeeping Can Help
We don’t just do books—we build compliance into your business. With Indigo Bookkeeping, you get:
- Cloud-based tools like Xero or MYOB
- Digitally organised records
- BAS-ready reporting
- Peace of mind at tax time
Need help with your record-keeping systems?
Contact Indigo Bookkeeping today—we’ll help you build a system that works for your business, not just the ATO.
