Records you need to show a payment or expense, the format to keep your records in, and how long to keep them.
What is a record?
Records are written evidence of your income or expenses, these can be either paper or electronic. You need to keep records that support the claims you make in your tax return.
For most expenses you need a receipt or similar document from the supplier. An acceptable record shows all of the following:
- the name or business name of the supplier
- the amount of the expense or cost of the asset
- the nature of the goods or services you buy
- the date you buy the goods or services
- the date the document was produced.
In some specific circumstances, there are record keeping exceptions.
The type and format of records you need will differ depending on what they are for, find out what records you need for:
Payments or amounts you receive
If you receive income or other payment amounts you need to declare in your tax return, you need records that show the amounts. You may need to provide us a copy of the records if we review a tax return you lodge.
For salary, wages, allowances, government payments or pensions and annuities you receive, your records may include:
- your income statement if your employer reports to us through single touch payroll (STP)
- your Pay as you go (PAYG) payment summary – individual non-business
- a signed letter or statement from your payer, that provides the same information as an income statement or payment summary
- your PAYG payment summary – superannuation income stream.
For assessable investment income from interest, divided and distributions from managed funds, your records may include:
- interest, dividends or distributions statements
- Standard Distribution Statement (SDS) and Attribution managed investment trust member annual (AMMA) statement, that shows
- the amount of your distribution
- the amount of any primary production or non-primary production income
- any capital gains or losses
- any foreign income
- your share of any credits, such as franking credits.
If you claim a deduction for a deductible expense, you must have records. Examples include the cost of managing your tax affairs or gifts and donations you make to a deductible gift recipient.
For most expenses you need a receipt or similar document as evidence of your expenses.
For information about specific records you need for gifts and donations, see Keeping records of gifts and donations.
If you claim a deduction for a work-related expense, you must have records of those expenses that show:
- you spent the money
- that the expense directly relates to earning your income.
To show how the expense relates to earning your income, you need a diary or similar record that shows:
- your private and work-related use.
- how you calculate the amount you claim as a deduction.
You can only claim a deduction for the work-related portion of an expense. When you use the items for both private and work purposes, you need to apportion your deduction.
There are some specific exceptions from keeping records for certain work expenses, see Record keeping exceptions.
For information about records you need for work-related expenses, see:
- Calculating your car expense deductions and keeping records
- Keeping records of vehicle expenses
- Keeping records for transport expenses
- Keeping travel expense records
- Keeping records for depreciating assets
- Keeping records for clothing, laundry and dry-cleaning
- Record keeping for the fixed rate method
- Record keeping for actual costs method
- Keeping records for self-education expenses
- Overtime meal allowance expense records
- Keeping records for mobile phone, mobile internet and other devices
- Keeping records for home phone and internet services.
For a summary of work-related expense records, download Keeping records for work-related expenses (PDF, 208KB).This link will download a file
Record for local government councillors
If you received an allowance from a council where you are a councillor, you need to keep written evidence of the work-related and car expenses you incur in carrying out your duties as a councillor. Expenses which allow you to maintain a public profile as local government councillors are deductible.
Investments and assets
If you acquire a capital asset you may make a capital gain or capital loss if you later sell the asset. To ensure you don’t pay more tax than necessary, keep good records from when you buy the asset.
This may include income you receive from an investment property or dividends from shares.
For information about the records you need for investments and assets, see:
- Keeping records of shares and units
- Records for rental properties and holiday homes
- Keeping records for property – your main residence and inherited dwellings
- Keeping crypto records.
The importance of keeping records
Australia’s tax system relies on self-assessment so we accept that the information you give us is accurate. If we review your tax return and you don’t have evidence to support claims for a deduction, your claims can be disallowed (taken off your tax return).
Keeping good records helps you and your tax adviser:
- to provide written evidence of your income and expenses
- prepare your tax return
- to ensure you are able to claim all your entitlements
- prove the information you provide in your tax return (in case we ask you)
- reduce the risk of tax audits and adjustments
- improve communication with us
- resolve issues that relate to a dispute of your assessments or adjustments
- avoid exposure to penalties.
Keeping good records reduces the cost of managing your tax affairs. If you use a tax advisor, you can reduce the time they spend sorting and preparing your records. This will give them more time to ensure you claim your entitlements.
If you incur expenses that you use partly for private purposes, you must have records that show how you worked out the part of expenses that you incur in earning assessable income.
For more information, see PS LA 2005/2 Penalty for failure to keep or retain records.
How long to keep your records
You must keep your written evidence for 5 years from the date you lodge your tax return.
In limited circumstances, there are different time periods for keeping records or record keeping exceptions.
In the following situations the period for keeping records is:
- 5 years from the date of your last claim for decline in value, if you claim a deduction for the decline in value of depreciating assets
- 5 years after it is certain that no capital gains tax (CGT) event can happen, if you acquire or dispose of a CGT asset
- for the later of following periods if you are in dispute with us, either
- 5 years from the date you lodge your tax return
- 5 years from the date the dispute is resolved.
Format of your records
You can keep your records in paper or electronic format, including photos of your written evidence. If you make paper or electronic copies of your records, they must be a true and clear copy of the original record.
Your records must be in English where you incur the expense in Australia. However, if you incur the expense in a country outside Australia, the document can be in the language of that country. If you incur the expense in Australia and your record is not in English, you need to translate them to English using an authorised translation office.
You can use any electronic device or app to keep your electronic records. However, we recommend backing up your electronic records regularly.
Keeping records with myDeductions
Our myDeductions tool in the ATO app is a record-keeping tool you can use to keep track of your records electronically.
Using the myDeductions tool makes keeping your records including photos easier.
We recognise documents you store digitally, including photos of your receipts as records.
Sole traders with simple affairs can also use it to help keep track of their business income and expenses.
You can upload your records from the myDeductions tool and pre-fill your tax return in myTax. If you use a registered tax agent, you can also email your records directly to them.
The myDeductions tool allows you to keep your records for:
- all work-related expenses (including car trips)
- interest and dividend deductions
- gifts or donations
- costs of managing tax affairs
- sole trader expenses and business income
- other deductions.