As a North Lakes business owner, you’re aware of the importance of keeping accurate and complete financial records. However, it’s not just enough to maintain these records – you must also have a document retention policy in place to ensure that your records are kept securely and for the required amount of time. In this blog post, we’ll explore the importance of document retention policies for North Lakes businesses and how Total Business Partners can help you implement one.
What is a Document Retention Policy?
A document retention policy is a set of guidelines that dictate how long a business should retain certain documents and how they should be stored. This policy covers a range of documents, including financial records, employment records, legal documents, and more.
Why is it Important for North Lakes Businesses?
Having a document retention policy in place is essential for North Lakes businesses for a few reasons. Firstly, it helps ensure compliance with Australian tax and regulatory requirements. The Australian Taxation Office (ATO) requires businesses to keep records for at least five years, and failure to do so can result in penalties and fines.
Secondly, a document retention policy helps protect your business in the event of an audit or legal dispute. Having accurate and complete records can help demonstrate that your business is operating in compliance with the law and can help defend against any allegations of wrongdoing.
Finally, a document retention policy can also help you better manage your records and keep them organised. By setting guidelines for how long to keep records and how to store them, you can avoid clutter and make it easier to locate specific documents when you need them.
What Documents Should You Retain?
The documents that your business should retain will depend on your industry and the nature of your business. However, some common documents that businesses should retain include:
- Financial records, such as income statements, balance sheets, and tax returns
- Employment records, including contracts, resumes, and performance reviews
- Legal documents, such as contracts, agreements, and permits
- Customer and vendor records, including invoices, purchase orders, and contact information
How Long Should You Retain Documents?
As mentioned earlier, the ATO requires businesses to keep records for at least five years. However, some documents may need to be retained for longer periods of time, depending on the nature of the document and the industry. For example, some legal documents may need to be kept indefinitely.
It’s important to note that the retention period for some documents may also be affected by any legal disputes or audits. In these cases, it’s best to consult with your accountant or legal advisor to determine the appropriate retention period.
How Can Total Business Partners Help?
At Total Business Partners, we understand the importance of document retention policies for North Lakes businesses. That’s why we can help you create a policy that is tailored to your business’s needs and meets all Australian tax and regulatory requirements.
We can also help you implement a document management system that makes it easy to store, organize, and access your records. By using cloud-based software such as Xero, you can securely store your records and access them from anywhere with an internet connection.
In conclusion, having a document retention policy in place is crucial for North Lakes businesses. It helps ensure compliance with Australian tax and regulatory requirements, protect your business in the event of an audit or legal dispute, and makes it easier to manage your records. If you need help implementing a document retention policy or managing your records, Total Business Partners is here to help. Contact us today to learn more.