Many owners clear out receipts once the tax return is filed. That is a risky habit. IRAS requires a company to keep its business records for at least five years from the relevant Year of Assessment (YA), and the obligation applies whether or not the company is GST-registered. Missing records can lead to tax being estimated and deductions being disallowed.

This guide explains what the IRAS rule says, how to count the five years, what counts as a proper record and what happens when a company closes down. It is based on IRAS guidance on record-keeping requirements for companies.

What IRAS expects you to keep

A company must keep proper records of its financial transactions and retain source documents, accounting records and schedules, bank statements and any other records connected with its business. You must be able to explain all transactions relating to income, business expenses and purchases.

  • Source documents: invoices, receipts, vouchers, contracts, delivery records and travel documents. These can be kept in paper or electronic form.
  • Accounting records and schedules: ledgers and schedules that summarise transactions in a systematic order.
  • Bank statements: necessary, but not enough on their own.

IRAS gives the example of a company that keeps only bank statements. That is treated as poor record keeping and can attract penalties of up to S$5,000. A taxi receipt or travel document is exactly the kind of source document needed to support a transport or overseas travel expense.

How to count the five years

The five years run from the relevant YA, not from the date of the transaction. For a company with a 31 December financial year end, records for the accounting period 1 January 2023 to 31 December 2023 relate to YA 2024, so they must be kept until 31 December 2028. For a company with a different year end, work out the YA first, then count five years from the end of that YA. When in doubt, keep records longer.

The Companies Act 1967 separately requires companies to keep accounting records, and GST-registered businesses have their own retention period under the GST rules, counted from the end of the GST accounting period. Use the longest period that applies to a given document. Our bookkeeping FAQ for Singapore SMEs covers day-to-day filing habits that make this easier.

Paper or electronic?

IRAS encourages companies to use accounting software, including products on its Accounting Software Register Plus. Electronic bookkeeping reduces manpower cost and makes records easier to retrieve for queries. Source documents may be held in either form, but you must be able to produce them in readable form on request.

If you change accounting software

IRAS says there is no specific requirement to migrate old transactions into new software. You must, however, continue to retain and be able to retrieve the transactions recorded in the old system, with their source documents, for at least five years from the relevant YA or the end of the GST accounting period. Before you cancel an old subscription, export a full set of ledgers and keep it safely.

When a company is struck off or wound up

IRAS notes that if a company is struck off and dissolved, a person who was an officer immediately before dissolution must ensure that all books and papers are retained for at least five years after the date of dissolution. If the company is being wound up, the liquidator must ensure the books and papers are retained for at least five years from the date of dissolution. Directors who plan to close a company should read our guide on how to strike off a Singapore company and agree who will hold the records.

What happens if you do not keep records

Failure to comply with record keeping requirements is an offence under the Income Tax Act 1947 and the Goods and Services Tax Act 1993. IRAS may exercise its best judgement to estimate the revenue earned, disallow expense claims, capital allowances or GST input tax claims, and impose penalties of up to S$5,000, with up to six months’ imprisonment in default of payment. Records are also the first thing requested in an audit or review, as described in our article on IRAS tax investigations.

A practical retention checklist

  1. Create a folder structure by financial year, with sub-folders for sales, purchases, payroll, bank and tax.
  2. Scan paper receipts promptly and name files consistently.
  3. Back up accounting data to a second location.
  4. Record the earliest destruction date for each year’s records.
  5. Keep records of dissolved entities with a named custodian.
  6. Review the set before any change of accountant or software.

Frequently asked questions

Can we discard records once the tax return is filed?

No. IRAS requires companies to keep records for at least five years from the relevant Year of Assessment, and filing the return does not shorten that period.

Are scanned copies acceptable?

IRAS says source documents such as receipts, invoices and vouchers may be kept in physical or electronic form. Whichever you choose, you must be able to retrieve and explain them when asked.

Do dormant companies need to keep records?

A company that does not trade should still keep its records for the same period, including bank statements, filings and the documents supporting its tax returns. Read our guide to dormant company filing obligations for what must still be filed.

Who is responsible if the accountant holds the records?

The company. Appoint a custodian, ask for periodic copies and make sure the engagement letter says what is returned at the end of the relationship.

What should we do before changing accountants?

Ask for the full ledger, schedules, tax computations and supporting files. Check that the handover includes everything IRAS may ask for, and confirm the date to which each record must be kept.

A simple example

A company with a 31 December year end prepares accounts for the year ended 31 December 2023. IRAS treats those as YA 2024, so the records are kept until at least 31 December 2028. If the company is struck off in 2026, the former officers must still ensure the books and papers are kept for five years after the date of dissolution.

Getting help

Good records make tax filing faster and cheaper, and they support better decisions. For wider business investment planning, you also need a reliable financial history. Raffles Corporate Services can help set up a bookkeeping routine that produces audit-ready files. You can read the full guidance on the IRAS website.

To speak with the team at Raffles Corporate Services, you can email [email protected] or call, SMS, or WhatsApp +65 8501 7133. We are happy to assist with any queries.

The Editorial Team, Raffles Corporate Services