How long to keep tax records in the UK (2026 update)

How long do you really need to keep your tax records when you’re self-employed?

Not only do accurate records prove how much tax you should pay, they can also keep you out of trouble in the event of an HMRC tax investigation. Plus with the introduction of Making Tax Digital meaning business owners need to keep digital records, what’s changing for your business?

But most importantly: business owners are required by law to keep tax records for a certain number of years.

How long do you have to keep tax records for HMRC?

Self-employed Self Assessment taxpayers need to keep their business records for at least five years after the 31 January deadline of the relevant tax year.

So if you filed your 2024-25 tax returns by the relevant deadline on 31 January 2026, you’ll need to keep your records until 31 January 2031.

If you run a limited company and need to file a company tax return, there are more rules and regulations.

If this applies to you, you’ll need to keep your accounting records for longer – six years from the end of the last company year they relate to.

There are some situations when limited companies need to keep records even longer, such as if:

• they show a transaction covering more than one of the company’s accounting periods
• the company has bought something that should last more than six years (like equipment)
• you sent the company tax return late
• HMRC is investigating your company tax return

Record keeping: step-by-step for the self-employed

All businesses need to keep records of their income and expenses, but the rules are different depending on your legal structure.

If you’re a sole trader or partnership…

1. Choose an accounting method

There are two accounting methods the self-employed can use – cash basis accounting and accrual (or traditional) accounting.

As of 6 April 2024, cash basis has become the default method of accounting for small businesses. If you want to use traditional accounting, you have to opt out of cash basis.

Record keeping when using cash basis accounting:

• you record income and expenses by the date you receive a payment or pay a bill
• so if you invoice a customer on 27 March 2026 and don’t get the payment until the end of April 2026, you record the income for the 2026-27 tax year

Cash basis is a simpler method of accounting, HMRC expects businesses to take a consistent approach to record keeping. For example, if you decide to record payments two working days after they’ve been received, you should stick to this approach. 

As with all record keeping, you’ll need to keep track of stock, debtors, and creditors to help your business run smoothly.

Record keeping when using traditional accounting:

• you record income and expenses by the date you invoiced or were billed
• so if you’re billed on 25 March 2026 and don’t make the payment until the end of April 2026, you record the expense for the 2025-26 tax year rather than 2026-27

2. What business records to keep

HMRC lists the records that sole traders need to keep. They include:

• sales and income
• self-employed expenses
• VAT records (if you’re VAT registered)
• PAYE records (if you have employees)
• details of personal income (for example from savings, investments, and rental income)
• details of grants

And if you use traditional accounting there’s more records you need to keep, like what you’re owed but haven’t received yet, as well as how much you’ve invested in the business over the year.

3. How to keep business records

There’s lots of information you need to keep – HMRC says you should also keep proof alongside your records, including all:

• receipts (for goods, stock, and expenses)
• bank statements
• cheque stubs
• sales invoices
• purchase orders
• till rolls
• bank slips

So it’s really important to have an effective filing system for all your business records. This should make everything easier when it comes to the tax-year end.

There’s accounting software and invoice software available that can automate some of these tasks and keep your records in one place. For example, some apps let you scan and upload your receipts.

Reminder: With the introduction of Making Tax Digital (MTD), small business owners and the self-employed will be required to keep digital tax records – as well as using MTD-compliant accounting software to submit.

If you do end up losing your records, you need to tell HMRC whether you’re using estimated figures or provisional figures when filling in your tax return. Provisional figures are best estimates while you wait for the actual figures.

If you’re a limited company…

1. Company records

While limited company directors will need to file a Self Assessment tax return, they’ll have more responsibilities than sole traders when it comes to record keeping.

That’s because the limited company legal structure is more complex, as it’s a separate entity.

This means you need to keep records of the company itself (not just financial records).

2. Accounting records

If you don’t keep accounting records, you can be fined £3,000 and disqualified as a company director, so it’s important you do this correctly.

As well as information about the company, you need to keep financial and accounting records.

If your records are lost, you need to try to recreate them. Tell your corporation tax office straight away and mention it in your company tax return.

3. How to keep limited company records

With the breadth of business records that limited companies need to keep, it’s important to have an effective system in place.

Hiring professionals like accountants and bookkeepers can be useful – but make sure you do your research and only work with people who have a good reputation.

While professionals are often expensive, they free up your time so you can focus on running your business. Plus, they can advise on record keeping and your overall tax liabilities.

Accounting and invoice software can also make record keeping a lot easier.

Record keeping FAQs

How long should I keep my tax records if I’m self-employed?

If you’re a sole trader or in a partnership, you must keep your business records for at least five years after the 31 January deadline of the relevant tax year. For example, records for the 2024-25 tax year (deadline 31 January 2026) must be kept until 31 January 2031.

What is the record-keeping requirement for limited companies?

Limited companies are generally required to keep accounting records for six years from the end of the last company financial year they relate to. However, you should keep them longer if the records cover transactions spanning multiple periods, involve long-term equipment purchases, or if HMRC is currently conducting an investigation.

What specific documents does HMRC require for record-keeping?

To remain compliant, you should keep proof of all transactions, including:

• invoices (sales and purchases) and receipts for stock and expenses
• bank statements and check stubs
• VAT and PAYE records (if applicable)
• records of personal income, grants, or investments

What are the penalties for not keeping accurate company records?

Failure to maintain proper accounting records for a limited company can result in a fine of up to £3,000 from HMRC and may lead to being disqualified as a company director.

How does Making Tax Digital affect my record-keeping?

Under Making Tax Digital, self-employed individuals and small businesses are required to maintain digital tax records. You must use MTD-compatible software to store your data and submit your returns to HMRC, as paper-only systems are being phased out.

What should I do if my tax records are lost or destroyed?

If records are lost, you must inform HMRC immediately. For Self Assessment, you may use “provisional” or “estimated” figures on your return, but you must specify which you are using. Limited companies must attempt to recreate the records and notify their Corporation Tax office right away.

More guides for small businesses

• Making Tax Digital: a guide for small businesses and the self-employed
• How to claim tax relief for small businesses
• When is the Self Assessment deadline?
• Public liability or professional indemnity insurance?