Tax season ends and the box of paper stays. Canadian tax laws set a floor for how long it has to survive, and several ordinary events push that date back by years. This guide shows you how to date each record, which ones outlive the standard clock, and what the Canada Revenue Agency (CRA) can ask to see.
Key Takeaways
- The clock runs from the end of a taxation year, not from the day you filed or the date on your notice of assessment.
- A late return, an objection, an appeal or a written demand from the agency extends it.
- Records for assets you still own, and records behind losses you have not finished using, stay live for years.
- A dissolved corporation keeps its minute books, share records and ledgers for two years after dissolution.
- Destroying anything early needs the agency’s approval, requested on Form T137.
The CRA Rule: Six Years From the End of the Tax Year
Tax record retention in Canada rests on subsection 230(4) of the Income Tax Act (ITA). You keep your records and books of account, with every voucher needed to check them, until six years after the end of the last taxation year to which they relate. Anyone carrying on a business, and anyone who has to pay or collect tax, falls under it.
Individuals are not exempt. The agency’s page for individuals says your tax documents and records should be kept for at least six years, even if you filed online and attached nothing. Records means more than the tax return: it means the supporting documents behind every figure, such as receipts, invoices, bank statements, cancelled cheques, mileage logs, payroll records, and proof for every deduction you claimed.
The six-year period starts when the year ends: December 31 for an individual, including a sole proprietor, and the fiscal year-end for a corporation. The table shows our own arithmetic for returns filed on time with none of the exceptions below; the agency does not publish a destruction calendar.
| Records for | Year ends | Six years later | Earliest day to let them go |
|---|---|---|---|
| An individual’s 2019 year | December 31, 2019 | December 31, 2025 | January 1, 2026 |
| An individual’s 2020 year | December 31, 2020 | December 31, 2026 | January 1, 2027 |
| A corporation’s year ending June 30, 2020 | June 30, 2020 | June 30, 2026 | July 1, 2026 |
Six years outlasts the window in which the agency can normally reassess most returns, which is deliberate. That window is its own subject, covered in our guide to statute-barred tax years.
When a Late Return or an Objection Keeps Records for Longer
A late or missing return. Under subsection 230(5), if you did not file a return when it was due, you hold the records for that year until six years from the date you file it, so an unfiled year never starts the clock. If you have years to catch up on, read our guide to the Voluntary Disclosures Program first.
Example. You file your 2021 return on November 15, 2024, long after its due date, and your next return on time. By our count, the on-time year’s records can go after December 31, 2028, but the late year’s file has to stay until November 15, 2030.
An objection or appeal. Once you serve a notice of objection, subsection 230(6) requires you to keep every record needed to deal with it until the time to appeal has passed. In an appeal, you hold them until it and any further appeal are decided, or the time to file one has run out. A Tax Court appeal can take years, as our Tax Court timeline shows, and the records have to last the whole way.
A written demand. Under subsection 230(7), the agency can require you, by registered letter or a demand served in person, to keep the records for a period it names. That letter sets the date, even if the six years have passed.
Tax Records You Must Keep Longer Than Six Years
Some records relate to years that have not arrived yet, because the asset is still owned or the loss is still being used.
Property you own and its cost base
Records for capital property, such as a rental unit, a cottage or shares, relate to the year you sell. Your adjusted cost base (ACB), the tax cost you subtract from the sale price, is built from the purchase agreement, closing costs and improvement invoices. Information Circular IC78-10R5 says those documents should be kept until six years after the end of the last year the transaction could enter a tax calculation. The agency’s record-keeping guidance for businesses goes further: records of long-term acquisitions and disposals of property should be kept indefinitely. At a minimum, we recommend keeping the whole purchase file until six years after you sell, counted from the end of the year of sale.
Example. Leila bought a rental condo in 2008 for $300,000 and paid $10,000 in legal fees and land transfer tax. In 2014 she spent $45,000 upgrading the kitchen and bathrooms, which she treated as a capital improvement. She sells in 2026 for $620,000 and pays $25,000 in commission and legal fees. With every document, her gain is $240,000 ($620,000 less $25,000 of selling costs and a $355,000 cost base), and half, $120,000, is taxable under paragraph 38(a) of the ITA. If she can prove only the $300,000 price, the gain becomes $295,000 and her taxable income rises by $27,500. By our count, the 2008 closing file has to survive until January 1, 2033, almost 25 years after she signed it. The example leaves capital cost allowance aside; our capital gains tax guide covers how the gain is taxed.
Share registers, minute books and the general ledger
For a corporation, Regulation 5800 under the ITA sets a longer period for its core records: minutes of directors’ and shareholders’ meetings, the record of who owns each share and every transfer, the general ledger, and any special contracts needed to understand it. The corporation keeps them until two years after the date it is dissolved. A company that runs for 30 years therefore keeps its first share register for at least 32. Our guide to the corporate minute book covers what belongs in it.
Records behind a loss carryforward
A loss can be deducted long after the year it happened. Paragraph 111(1)(a) of the ITA lets you carry a non-capital loss forward 20 years, and a net capital loss can be carried forward with no time limit. The related records support every later return that uses the loss, so on our reading of subsection 230(4) you keep them for the last year you deduct any of it, plus six years.
Example. A corporation with a December year-end has a $90,000 non-capital loss in 2022. It deducts $40,000 in 2025 and the last $50,000 in 2030. On that reading, the invoices and ledgers behind the loss stay until December 31, 2036, eight years after the rest of the 2022 records could go.
How Long to Keep Records After a Business or Estate Closes
A dissolved corporation. Paragraph 5800(1)(b) extends the two-year rule to every other record of a dissolved corporation, including its supporting documents. Treat that as a floor. On our reading, a company that receives the notice of assessment on its last return and dissolves a few months later can reach the end of the two years while the normal reassessment period on that return is still running. Keeping the file for at least two years meets the rule; keeping it until that period ends is the safer habit.
If you are deciding how to close a company, our comparison of amalgamation and wind-up sets out the tax side. After an amalgamation, the agency says the new corporation usually keeps the business records of each predecessor for the usual six years.
A sole proprietorship or partnership. An unincorporated business that stops keeps its files for six years after the end of the year it closed, and paragraph 5800(1)(c) applies the same period to its general ledger.
An estate or trust. Estate records follow a shorter rule. Once the agency issues a clearance certificate for the property of a deceased taxpayer or a trust, the legal representative can destroy the records, under paragraph 5800(1)(g).
Can You Keep Digital Copies? Electronic Records and Scanned Receipts
Yes, with two conditions. First, subsection 230(4.1) requires anything you keep electronically to stay in an electronically readable format for the whole retention period, even if you printed it. Cancel an accounting subscription without exporting your data, and years of readable books can go with it.
Second, a scan replaces paper only if the imaging is done properly. The agency’s page on imaging paper documents says images made to the Canadian General Standards Board (CGSB) standards become the permanent records, so you can destroy the imaged paper. A business that cannot meet those standards is required to keep the originals.
Information Circular IC05-1R1 describes an acceptable imaging program: written approval from someone in authority, documented procedures, a logbook of what was imaged and by whom, an index, legible images and regular quality checks. In our view, a phone photo of a receipt is an image like any other and faces the same test.
Location matters too. Records belong at your place of business or residence in Canada unless the agency approves another place, and records kept outside Canada and accessed electronically from Canada are not considered kept in Canada. IC05-1R1 adds that the agency may accept a readable copy made available in Canada, so if your document management system stores files abroad, keep that copy here. Hiring a bookkeeper or a cloud service does not move the obligation.
Keeping Tax Records for GST/HST and Input Tax Credits
Sales tax follows a parallel rule. Section 286 of the Excise Tax Act (ETA) covers anyone carrying on a business or commercial activity in Canada, anyone who files a GST/HST return, and anyone claiming a rebate. Those records stay for a period of six years after the end of the year they relate to, in English or French, and in Canada unless the Minister authorizes otherwise. The ETA mirrors most of the ITA’s exceptions, so small business owners can run one schedule for both taxes.
The records that matter most are the invoices behind your input tax credits (ITCs). The Input Tax Credit Information (GST/HST) Regulations set what that paperwork must show, in three tiers:
- Under $100: the supplier’s name, the invoice date and the total paid or payable.
- $100 to under $500: all of that, plus the supplier’s GST/HST registration number and either the tax charged or a statement that tax is included, along with the tax rate.
- $500 or more: all of that, plus your name, the terms of payment and a description of what you bought.
A registration number only helps if it is real, so learn how to verify a supplier’s GST/HST number. An old period does not expire on its own either: the CRA says a GST/HST return for a reporting period that ended more than six years ago still has to be filed, with records to support it.
Destroying Records Before the Retention Period Ends: Form T137
You can let records go sooner, but you need written permission from the CRA first. Subsection 230(8) of the ITA allows it, and subsection 286(6) of the ETA does the same for GST/HST records.
For ITA records, the request goes on Form T137, Request for Destruction of Records. Individuals, corporations, trusts, partnerships and tax-exempt entities, or their authorized representatives, can use it, and you must mail the completed form to your tax services office. The current version, T137 E (25), notes that most records need a minimum of six years. For records under other laws the agency administers, including GST/HST, you apply in writing to the same office.
The form asks for your reason, a list of the records and the dates they cover, whether they are paper, imaged or digital, whether every return is filed and the appeal period is over, whether an objection is outstanding, and whether a letter has asked you to keep them. Destroy records without permission and, the agency warns, you may be prosecuted. For most households and small companies, storage costs less than the request.
What the CRA Can Ask to See in an Audit
Section 231.1 of the ITA lets an authorized officer inspect, audit or examine any document of yours, or of another person, that may be relevant to your tax obligations. The officer can enter a place of business, although a home needs your consent or a warrant, and can require answers to proper questions orally or in writing. Under section 231.2, when the CRA requests information or documents formally, the notice sets a reasonable deadline. Our guide to the agency’s audit powers covers what you can push back on.
The agency’s audit guide, RC4188, lists what an auditor examines: business documents such as ledgers, invoices, receipts, contracts and bank statements; personal financial records such as bank statements, mortgage documents and credit card statements; and records of people who are not being audited. If records are missing, RC4188 says you have to try to get copies from whoever created them, such as your bank or suppliers.
Copies will not always exist. Under subsection 152(7), the Minister is not bound by your return, which in practice means an auditor estimates what your records cannot prove. Failing to keep records is also an offence: subsection 238(1) sets a fine of $1,000 to $25,000, or that fine plus up to 12 months in prison. Subsection 162(7) adds a penalty for failing to meet a duty under the Act of $25 a day for up to 100 days, with a $100 minimum.
In our CRA representation practice, CRA audits rarely turn on last year’s receipts. They turn on the purchase file for a property bought 15 years ago, a minute book nobody updated, or the invoices behind a loss claimed long after it arose. Our overview of the types of audits explains what each one asks for first, and our audit representation team can handle the requests for you.
Common Mistakes in Managing Tax Records
- Counting six years from the filing date or the notice of assessment instead of from the end of the taxation year.
- Shredding a late-filed year on the normal schedule.
- Throwing out a purchase file because the property was bought more than six years ago.
- Switching accounting software without exporting readable copies of the old books.
- Scanning paper with no index or log, then destroying the originals.
- Letting records go while an objection, appeal or written demand is still open.
Action Checklist
- Label each year’s folder with its earliest disposal date, and redo the label for any year filed late.
- Move property purchase files, share records and loss schedules into a permanent folder.
- Keep all related documents with the tax return they support, including every notice of assessment and reassessment.
- Export digital records to a readable format before you change software.
- Check that purchase invoices of $100 or more show the supplier’s registration number.
- At each tax filing, retain records for any year still under objection, appeal or a written demand.
- Ask for permission on Form T137 before destroying anything early.
Frequently Asked Questions
How many years should you keep income tax records in Canada?
Six years after the end of the last taxation year they relate to, under subsection 230(4) of the ITA, for individuals and businesses alike. The count runs longer for a late return, an objection or appeal, a written demand, property you still own and losses you have not finished using.
What is the CRA 7 year rule?
There is no seven-year rule in the legislation; the rule is six years after the end of the year. The seven probably comes from counting calendar years. By our count, records for 2019 have to be kept through December 31, 2025, which is seven calendar years if you count 2019 itself.
What year tax records can I destroy in 2026?
If you filed on time, have no dispute or demand open, and nothing in the file relates to a later year, records for 2019 and earlier can go in 2026 on our count. A corporation counts from its own year-end. Throwing out records after six years is safe only after you have pulled out anything tied to property you still own or losses you are still using.
How long should you keep old tax records for property you sold?
Keep the purchase agreement, closing statement and improvement invoices until six years after the end of the year you report the sale. The agency’s business guidance goes further and says to keep them indefinitely, which is the simpler habit.
How many years back can the CRA audit you?
An auditor can ask about any year, but how far back the agency can change your tax is limited by the reassessment period in section 152 of the ITA. That period is shorter than six years for most returns and longer in specific cases, and six years of records is designed to outlast it.
Does the six-year rule apply if you are self-employed?
Yes. Subsection 230(1) applies to every person carrying on a business, so a sole proprietor keeps sales records, expense invoices and bank statements for the same six years. If you are registered for GST/HST, section 286 of the ETA sets a matching period for those records.
The Bottom Line
Most records can go six years after their year ends. The expensive mistakes come from the few that cannot.
- Count from the end of the taxation year, and from the filing date for a late return.
- Hold anything tied to an open dispute, a written demand, an asset you own or an unused loss.
- Keep a dissolved corporation’s records for two years after dissolution at minimum, and longer while its last return can still be reassessed.
- Scan to the standard, keep files readable, and get permission before destroying anything early.
A retention schedule looks simple until a property sale, a late year and an open objection share the same cabinet. If your records include a corporation, our corporate tax team can map what each file still has to prove, and you can book a review before anything goes in the shredder.
