How long do tradies have to keep business records in Australia?
By Invogo Team · Updated · 3 min read
Most tradies need to keep their business records for 5 years. The clock starts from when you prepared or got the record, or finished the transaction, whichever is later. Some records, like asset purchases and tax losses, have to be kept longer.
How long do I have to keep business records?
You generally keep tax records for 5 years from the later of the date you prepared or obtained the record, or completed the transaction it relates to. This applies to sole traders, partnerships and companies.
The ATO also says you must keep records long enough to cover the "period of review", which is the window it has to review or amend an assessment. In many cases the 5-year rule already covers it, but it can run longer if you use a record again in a later return.
A simple rule for a busy tradie: keep everything for 5 years from the end of the financial year it relates to, and you will be covered for the usual cases. Keep more for the exceptions below.
What records does a tradie need to keep?
Keep anything that explains your income, expenses and tax. For a typical tradie that means:
- Income: invoices you issued, quotes you accepted, payment receipts, bank statements, cash sales
- Expenses: supplier invoices, material receipts, fuel, tools, vehicle costs, insurance, phone and software
- GST records: tax invoices you issued and received, and your BAS if you are registered (see when to register for GST and BAS for sole traders)
- Assets: purchase records for your ute, tools and equipment
- Contractors and staff: payments to subcontractors, wages, super and PAYG withholding
- Agreements: contracts, variations and signed quotes
Supplier tax invoices matter because you need them to claim GST credits. See what a tax invoice must show.
Which records do I need to keep longer than 5 years?
Some records have to be kept for longer than 5 years. The ATO lists several cases.
| Record | How long to keep it |
|---|---|
| Depreciating assets (ute, tools, machinery) | While you hold the asset, then 5 years after you sell or dispose of it |
| Capital gains tax (CGT) assets | While you own it, then 5 years after disposal |
| Records of a tax loss | 5 years, or until the period of review ends for the year the loss is fully deducted, whichever is later |
| Records used again in a later return | Until the period of review for the later return ends |
| Fringe benefits tax records | The ATO runs these from lodgment, not from when the record was made |
Example: you buy a $60,000 ute in 2026 and sell it in 2031. You keep the purchase record for the whole time you own it, then until 2036.
How long do I keep employee records?
If you have employees, Fair Work generally requires wage, hours, leave and super records to be kept for 7 years. That is longer than the tax rule. Sole traders with no staff can ignore this, but subcontractor payment records still count as tax records.
Do records have to be paper?
No. Digital records are fine, and the ATO encourages them. A clear photo or scan of a receipt is accepted if it is a true copy and readable. Records must be in English or easy to translate into English.
Practical tips:
- Photograph receipts the day you get them, before they fade
- Back up to cloud storage, not just your phone
- If you change software, make sure you can still get your old data out
- Keep invoices in one place. Invogo stores every invoice and quote you create, with the GST and your ABN on each, and the free plan covers 5 invoices or quotes a month
What happens if I don't keep proper records?
You can be penalised for not keeping records as required. More commonly, if the ATO reviews you and you can't prove a deduction, the deduction can be knocked back, which means more tax, interest and possibly penalties. Deliberately destroying records to obstruct the ATO is an offence.
Can I throw records out after 5 years?
Usually yes, once the 5 years and any period of review have passed and none of the longer-term exceptions apply. Check assets and losses first. If you are unsure, ask your accountant before binning anything.
Good records also help you get paid. Clear invoices and a trail of accepted quotes make it far easier to chase an overdue invoice. Invogo has invoicing for tradies built around this, or you can start free.
General information, not advice. Check with your accountant or the ATO for your situation.
Frequently asked questions
Can I keep receipts as photos on my phone?
Yes. The ATO accepts a clear, true copy of a receipt as a photo or scan. Back it up somewhere other than your phone.
Do sole traders need to keep records for the same time as companies?
For tax records, yes: generally 5 years. Companies also have separate record duties under corporate law, so check with your accountant.
Do I keep records if I close my business?
Yes. The retention period still applies after you close, so keep your records for the full period.
What if I lose a receipt?
Ask the supplier for a copy, or check your bank statement and supplier account. Without proof the ATO can disallow the deduction.