UPDATED 29 FEBRUARY 2016
Did you miss Bonfire Day? And I mean Day, not Night. Not 5th November but 1st February. It is the day when eleven million people who do self-assessment can celebrate getting their form in by the 31 January deadline. Because the day after that they can burn some of their older financial records.
If you are in business, self-employed or you rent out property, then you must keep records for five years after your self-assessment form was due in. The return for 2009/10 was due in on 31 January 2011 and five years from then was 31 January 2016. So the next day you could destroy all records which relate to the tax year 2009/10.
If your annual accounts are made up to 5 April then you can destroy documents dated between 6 April 2009 and 5 April 2010. But if your accounting year begins on 1 May, as many do, then you must keep almost another year�s documents. So on 1 February 2016 you could destroy records dated 1 May 2008 to 30 April 2009. The rule is that you must keep financial records used in a tax return which are all those for your accounting year which ends in that tax year. That accounting year ends in the financial year 2009/10 so can be destroyed on 1 February 2016.
If you are VAT registered then you must keep documents for six years after the most recent item mentioned on them. So on 1 February that would be those dated up to 31 January 2010. So some documents may have to be kept a little longer than 1 February, depending when your year end is. There is a different VAT rule if you sell digital goods to other EU countries - the VAT MOSS scheme. Then you must keep records of those sales until 31 December after their tenth anniversary. So sales in February 2016 need to be kept until 31 December 2026! See VAT Record Keeping.
If you do self-assessment but are not in business then on 1 February 2016 you can destroy records for the 2013/14 tax year � 6 April 2013 to 5 April 2014. However, it is cautious to keep records for a bit longer as overpaid tax claims can go back four previous tax years. At the moment that means back to 2011/12. But on 6 April 2016 you can have another bonfire to get rid of records from 2011/12 as it will then be too late to make a claim for that year. The ultra-cautious may note that some legal claims can go back up to six calendar years and mis-selling claims such as PPI have gone back much further.
NB If your tax return was sent in late � after 31 January � then you should keep records for fifteen months after it was sent and if there is a live tax enquiry into your affairs you must retain records that relate to the year of the enquiry until it is settled.
Gov.UK: Keeping your pay and tax records
Gov.uk: Business records if you're self-employed
If you do not fill in a self-assessment form you do not have to keep records for any particular time. Four previous tax years or even longer is cautious - see above.
Of course never destroy documents about loans, mortgages, investments, or other financial contracts that are current. If you do the probate on someone's estate you should keep the probate records for 20 years.
And a cross-cut shredder might be safer and more secure than a bonfire.
Version 2.0
29 February 2016
Did you miss Bonfire Day? And I mean Day, not Night. Not 5th November but 1st February. It is the day when eleven million people who do self-assessment can celebrate getting their form in by the 31 January deadline. Because the day after that they can burn some of their older financial records.
If you are in business, self-employed or you rent out property, then you must keep records for five years after your self-assessment form was due in. The return for 2009/10 was due in on 31 January 2011 and five years from then was 31 January 2016. So the next day you could destroy all records which relate to the tax year 2009/10.
If your annual accounts are made up to 5 April then you can destroy documents dated between 6 April 2009 and 5 April 2010. But if your accounting year begins on 1 May, as many do, then you must keep almost another year�s documents. So on 1 February 2016 you could destroy records dated 1 May 2008 to 30 April 2009. The rule is that you must keep financial records used in a tax return which are all those for your accounting year which ends in that tax year. That accounting year ends in the financial year 2009/10 so can be destroyed on 1 February 2016.
If you are VAT registered then you must keep documents for six years after the most recent item mentioned on them. So on 1 February that would be those dated up to 31 January 2010. So some documents may have to be kept a little longer than 1 February, depending when your year end is. There is a different VAT rule if you sell digital goods to other EU countries - the VAT MOSS scheme. Then you must keep records of those sales until 31 December after their tenth anniversary. So sales in February 2016 need to be kept until 31 December 2026! See VAT Record Keeping.
If you do self-assessment but are not in business then on 1 February 2016 you can destroy records for the 2013/14 tax year � 6 April 2013 to 5 April 2014. However, it is cautious to keep records for a bit longer as overpaid tax claims can go back four previous tax years. At the moment that means back to 2011/12. But on 6 April 2016 you can have another bonfire to get rid of records from 2011/12 as it will then be too late to make a claim for that year. The ultra-cautious may note that some legal claims can go back up to six calendar years and mis-selling claims such as PPI have gone back much further.
NB If your tax return was sent in late � after 31 January � then you should keep records for fifteen months after it was sent and if there is a live tax enquiry into your affairs you must retain records that relate to the year of the enquiry until it is settled.
Gov.UK: Keeping your pay and tax records
Gov.uk: Business records if you're self-employed
If you do not fill in a self-assessment form you do not have to keep records for any particular time. Four previous tax years or even longer is cautious - see above.
Of course never destroy documents about loans, mortgages, investments, or other financial contracts that are current. If you do the probate on someone's estate you should keep the probate records for 20 years.
And a cross-cut shredder might be safer and more secure than a bonfire.
Version 2.0
29 February 2016
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