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How long do I have to keep bank statements?

Tax | Income Tax Helpful? 9

Asked by brownowl, submitted 12 January 2010.

Open Quote Is there a legal requirement to keep copies of bank and credit card statements for a certain period of time for tax or other purposes? I'm organising my finances and wanted to know what types of documents I may need to produce.End Quote

Answered by Justin on 12 January 2010

The taxman (HMRC) requires you to keep records relating to your tax return as follows:

CategoryHow long should records be kept?
Individuals & DirectorsAt least 1 year and 10 months after the end of the tax year they relate to.
Self-EmployedAt least 5 years and 10 months after the end of the tax year they relate to.
Partners & PartnershipsAt least 5 years from the 31 January following the tax year they relate to.
Companies (corporation tax)At least 6 years from the end of your Corporation Tax accounting period.
VATAt least 6 years.

While the actual records that need to be kept will vary depending on circumstances, they’ll invariably include bank and credit card statements along with other records of income and expenditures relating to a tax return.

If you have investments then ensure you keep records relating to purchases and sales for capital gains tax purposes, as well as those of any income received such as interest and dividends.

Although HMRC requires employees and those not working to keep records for at least 22 months after the end of the tax year they relate to, if you have space you might want to err on the side of caution and keep them for six years. I work on the basis it’s better to have the information to hand should it ever be required in the event of a dispute (unless you’ve something to hide!).

Even if you don't complete a tax return it's still wise to keep records as if you were, just in case HMRC ever decides to take a look at your financial affairs.

As for more mundane documents such as electricity, gas and council tax bills, unless you’ve used them when completing your tax return then it’s up to you how long you keep them. I’d suggest a couple of years in case you end up having to dispute something.

Likewise, it’s up to you how long you keep receipts that are unrelated to your tax return. If you paid by debit/credit card or cheque then you might as well throw them away after reconciling them against your bank/credit card statement, unless you need to retain them as proof of purchase for a guarantee.

You can read full details of HMRC’s rules and guidance on record keeping here.

Please note this answer does not constitute a recommendation or financial advice and should not be relied upon when making specific investment or other financial decisions. You should always undertake your own research into whether a product or service is appropriate for your needs and, if necessary, use a qualified professional adviser.

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