Five years for a sole trader, six for a limited company, three for PAYE, and none of them is the seven years almost everybody repeats. Here is where each period comes from, what extends it, and where the seven-year idea started.
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There is no single answer, and that is the first thing worth knowing. The retention period depends on the type of business and on the records concerned, and some records need to be kept for longer than the headline figure. Here is the general position on one screen, with the exceptions further down.
| If you are | Keep records for | Counted from |
|---|---|---|
| Self-employed | 5 years | the 31 January submission deadline for that tax year |
| A limited company | 6 years | the end of the financial year the records relate to |
| VAT registered | Normally 6 years; some VAT schemes require 10 years | the date of the record |
| An employer, for PAYE | 3 years | the end of the tax year they relate to |
None of those is a flat seven years, which is what the previous version of this page said. There is no single seven-year rule in UK tax, and there is a section at the end on where the idea comes from. Equally, do not read the table as the whole answer: these are the general periods, and several situations extend them.
Generally five years, and the clock does not start when you make the record. HMRC states it in one sentence, and that sentence is the whole reason the seven-year belief is wrong.
You must keep your records for at least 5 years after the 31 January submission deadline of the relevant tax year.
Five, and measured from the 31 January deadline rather than from the year end or from the transaction. Worth knowing, given how confidently the wrong figure gets repeated.
That wording matters, because it is measured from a filing deadline rather than from the transaction. HMRC's own worked example: a 2022 to 2023 return filed by the deadline of 31 January 2024 means keeping those records until January 2029. So a receipt from April 2022 has to survive nearly seven calendar years, which may explain some of the confusion around the commonly quoted seven-year period.
It is still a five-year rule. It is just five years measured from a date up to nearly twenty-two months after the transaction.
Generally six years, and this time measured from the end of the financial year: "You must keep records for 6 years from the end of the last company financial year they relate to." The full guidance is on GOV.UK, and it is worth reading rather than taking from us.
A company with a 31 March year end therefore keeps its 2025/26 records until 31 March 2032. If you run a company and a sole trade side by side, you are running two clocks on two different bases, which is a good argument for keeping everything to the longer one and not thinking about it again.
If you are VAT registered, the VAT records normally go six years, whichever kind of business you are. Some schemes require longer: GOV.UK puts it at "at least 6 years (or 10 years if you are using the VAT One Stop Shop (OSS) scheme or used the VAT Mini One Stop Shop (MOSS) scheme)", and the Import One Stop Shop carries its own ten-year rule. Most small businesses are on neither, but it is worth knowing the six is a normal case rather than a universal one. The six-year period is set out in VAT Notice 700/21 and it sits on top of the periods above rather than replacing them.
It is the reason a sole trader who registers for VAT quietly moves from a five-year world to a six-year one for a large part of their paperwork. Very few people notice that happening. If VAT is on your mind, our VAT return service covers the record side as well as the filing.
The shortest of the four. An employer must keep PAYE records for three years after the end of the tax year they relate to, under regulation 97 of the Income Tax (PAYE) Regulations 2003. Records for 2025/26, the year ending 5 April 2026, run to at least 5 April 2029.
This three-year period applies to PAYE records and should not be treated as the retention period for every employment record. National Minimum Wage records can require six years, while most workplace pension automatic-enrolment records must also be kept for six years and opt-out records generally for four years.
Three years is short enough that people throw payroll records away while the matching accounting records are still live. Keeping the wrong things is rarely the problem; throwing the right things away early is. Do not do it by department. Do it by the longest period that applies to the business, which for most limited companies means six.
There is a separate Companies Act retention period for accounting records, three years for private companies and six years for public companies, but Corporation Tax rules generally require relevant company tax records to be retained for six years. So the tax requirement is normally the practical period for a private company, and six is the number to work to.
The headline periods are floors, not ceilings. You keep records beyond them when any of these apply:
And one that catches people badly: if you send a tax return more than four years after the deadline, you have to keep the records for 15 months after you send it, which can push the real period well past anything in the table above.
Broader than most people assume. For a limited company HMRC wants all money received and spent, company assets, debts owed and owing, stock at year end and the stocktaking behind it, all goods bought and sold, who you bought from and sold to, and every supporting document: receipts, invoices, bank statements, delivery notes, till rolls, and the calculations you used to get from those to the accounts.
That last item is the one people forget. The workings are a record. If your accounts say a figure and nothing on file explains how you arrived at it, you have kept the answer and thrown away the sum. It is also what makes a Self Assessment return possible to prepare in an afternoon rather than a fortnight.
And yes, bank statements count. They follow the same period as the rest of the business records: five years for a sole trader from the January deadline, six for a company from the year end. Not seven.
For a growing number of businesses this is no longer a preference. Making Tax Digital for Income Tax requires those within the rules to keep specified records digitally and submit quarterly updates using compatible software, and an annual tax return is still required. It is already in force for qualifying sole traders and landlords with qualifying income over £50,000, subject to exemptions. If that is you, a paper system is not an option to weigh up.
Which package you use matters less than using one consistently, and we have written separately about choosing accounting software. Beyond that, you can keep almost everything digitally. Paper records can often be stored digitally instead, provided the digital copy captures all the required information and remains legible and accessible. Some documents must still be retained in their original form, so check the rules applying to the particular record before destroying the paper original.
Two cautions from experience. A photograph of a receipt that has faded to nothing is not a record of anything, and thermal till receipts fade fast, so capture them the week you get them rather than the month you file. And storage in an app owned by a supplier you might leave one day is only a record for as long as you keep paying for it. Export periodically.
We have written separately about who Making Tax Digital applies to and from when, including the thresholds that bring the next two groups in.
For a limited company, failing to keep adequate accounting records carries a £3,000 penalty from HMRC, or disqualification as a director. That is the headline figure and it is rarely the real cost.
The larger risk is usually that a check you cannot answer with documents gets settled on estimates, and estimates tend not to be generous. An expense you genuinely incurred but cannot evidence may not be accepted, depending on the circumstances and on what else supports it.
The ACCA puts the same point to its own members in careful language, and the care is worth copying.
If HMRC checks a tax return for any reason and the taxpayer is unable to show the records that they used to complete the return, they may have to pay a penalty.
Notice the conditional. Even a professional body writing for accountants says "may", because whether a penalty actually follows depends on what the check finds, what else supports the figure, and how the whole thing is handled. That is the register this entire subject should be written in, and it is the reason you should be wary of any article that tells you what HMRC will definitely do. What is not conditional is the position you put yourself in: with the records, you are arguing about a number, and without them you are arguing about whether the number ever existed.
We have picked up businesses whose bank accounts had not been reconciled for several years, and one QuickBooks file so far gone that it was cheaper to rebuild the records from a clean account than to correct what was there. In almost every case the underlying documents existed. They were simply never matched to anything, which makes it much harder to demonstrate how the figures in the accounts or tax return were derived. The amount of clean-up work that takes depends on the volume and condition of the records, so we review the books before agreeing the scope.
It is worth naming, because it is repeated confidently on a great many accountancy websites and it was on this page until we corrected it.
There are three honest reasons it persists:
Keeping records for seven years is not dangerous, and nobody is suggesting you shred anything on the stroke of the deadline. It is wrong in the sense that it is not what the law says, and if you are going to build a filing policy on a number, it may as well be the right one. Keeping everything indefinitely is not a free option either: personal data is meant to be kept no longer than you need it, so an unbounded filing policy is its own small problem.
It depends on the business and the record. A sole trader generally keeps records for at least 5 years after the 31 January Self Assessment deadline for that tax year. A limited company generally keeps accounting records for 6 years from the end of the financial year they relate to. VAT records normally run 6 years, and 10 years on the VAT One Stop Shop or Mini One Stop Shop schemes. PAYE records run 3 years. Some records need to be kept for longer.
No. There is no flat seven-year rule in UK tax. The confusion is understandable: five years measured from a 31 January filing deadline can mean holding a receipt for close to seven calendar years, and seven years is a common rule of thumb in the United States. Keeping records for seven years does no harm, but it is not what the law requires.
Bank statements are part of your business records, so they follow the same period as the rest: generally 5 years for a sole trader from the 31 January deadline, and 6 years for a limited company from the end of the financial year.
Where the record covers a transaction spanning more than one accounting period, relates to an asset expected to last beyond the period, where the return was filed late, or where HMRC has opened a compliance check. A return sent more than four years after the deadline means keeping the records for 15 months after you send it.
Yes, and for many businesses digital records are now a requirement rather than a choice. HMRC accepts scans and photographs of paper documents provided they are legible and complete. Making Tax Digital requires digital record keeping for those within it, subject to HMRC exemptions.
A limited company that fails to keep adequate accounting records may face a penalty of £3,000 from HMRC, or disqualification as a director. The larger practical risk is that a check you cannot answer with documents may be settled on estimates, and an expense you cannot evidence may not be accepted.
Three years after the end of the tax year they relate to, under regulation 97 of the Income Tax (PAYE) Regulations 2003. Records for the 2025/26 tax year, which ended on 5 April 2026, run to at least 5 April 2029.
More than most people assume. Money in and out, assets, debts owed and owing, year-end stock, purchases and sales, who you bought from and sold to, and the supporting documents behind all of it. It also includes the calculations you used to get from those documents to the accounts, which is the part most often thrown away.
Every figure on this page was checked against the sources above on . Rates and thresholds change. If you are reading this long afterwards, check the current position before you act on it.
If your bookkeeping is behind, records are missing, or you are unsure what needs to be retained, tell us what you currently have. We can review the position and explain what needs sorting before any work is agreed.
What this touches
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