What are the mandatory retention periods for accounting documents and invoices in Quebec?

It’s difficult to deal with archives overflowing with illegible invoices and old accounting documents from your business.
There are certain documents that are important to the Quebec tax authorities and must be carefully retained. But how long do you need to keep them, and why?

Do accounting documents have to be retained for at least 6 years?
For many years, Canadian businesses have been required to retain certain accounting documents for at least 6 years. The Income Tax Act allows these documents to be retained in either paper or electronic form. You can use tax and accounting software for this purpose.
Here are a few examples of accounting documents you must keep:
• Daily revenue reports, along with invoices and cash register receipts.
• Daily expense reports with voided or cancelled cheques, as well as expense receipts.
• A log of trips and expenses related to business vehicles, along with supporting documents.
• Corporate credit card statements.
• Records containing employees’ names, their salaries, and payroll deductions.
It is therefore necessary to retain all these documents for a period of 6 years. This period begins at the end of the tax year to which the documents relate. For example, tax returns for the year 2022 must be retained through 2028.
Why should you keep your accounting records for six years?
During this period, businesses must be able to provide all information and documents requested by the Canada Revenue Agency (CRA) for federal purposes or by Revenu Québec for provincial purposes. In the event of a tax audit of your corporate tax return, these tax agencies may require supporting documentation.
It is also mandatory to retain all supporting documents that can be used to verify the information contained in your records, such as business invoices (revenues and expenses).

Are there any accounting documents that businesses are required to keep indefinitely?
Although the standard retention period for business documents, whether accounting or tax-related, is 6 years, it is recommended that certain other documents be retained for the entire lifetime of the business.
Here are a few examples of business documents you should keep indefinitely:
• Notarial deeds.

• Minutes of board of directors meetings.

• Share certificates and share transfer documents.

• Any other document supporting an entry in the general ledger.
Finally, if your business is dissolved, it is essential to retain the originals of these documents for at least two years after the dissolution.

Are there any documents that must be retained at the request of government agencies?
There are exceptional circumstances in which the Canada Revenue Agency (CRA) or Revenu Québec may advise you to retain certain business records beyond the statutory 6-year retention period.
If this applies to you, a representative from the tax authority will contact you directly or send you a letter by registered mail to inform you of this requirement. In this communication, the nature of the business document and the required retention period will be specified.

How can you find an accountant to help you manage your accounting records?
The retention of business records is a major concern for Quebec businesses seeking to comply with administrative requirements.
In general, it is recommended that business records be kept for at least 6 years, but there are exceptions that require them to be kept longer, or even indefinitely.
Understanding your tax obligations allows you to comply with the record-keeping requirements of the Canada Revenue Agency (CRA) and Revenu Québec. However, it may be wise to seek the assistance of accountants to help you better understand all of your business obligations.
If you have any questions about tax laws and regulations in Quebec and Canada, please don’t hesitate to contact us if you’d like to find an accountant who understands your business needs and can assist you with this process. https://www.bankeo.ca/