Every tax season, the same question comes up: how long do I actually need to keep all of this? The shoebox of receipts from three years ago, the T4 slips from your first year in business, the invoice for that piece of equipment you bought and later sold, at what point can you safely let it go?
The answer matters. If the CRA audits you and you cannot produce the supporting documents, they can deny the deduction or credit, reassess your return, and charge additional tax plus interest and penalties. At Cassar CPA, we work with small business owners and incorporated professionals across the Greater Toronto Area who need clear guidance on this. Here are the rules.
The General Rule: Six Years
Under section 230 of the Income Tax Act, most taxpayers, individuals, businesses, and corporations, must keep their books, records, and supporting documents for a minimum of six years from the end of the last taxation year to which they relate. The Excise Tax Act has a parallel requirement for GST/HST records.
The clock starts from the end of the tax year, not from the date you filed. Records supporting your 2025 tax return (taxation year ending December 31, 2025) must be kept until at least December 31, 2031. This applies to everything that supports your filing: T-slips, expense receipts, bank statements, invoices, payroll records, GST/HST returns, and any documentation of income earned or deductions claimed.
When Six Years Is Not Enough
The six-year rule is the baseline, but several common situations require you to keep records longer. These are where most people get caught off guard.
Late-filed returns. If you file a return late, the six-year period starts from the date you actually file, not from the end of the tax year. File your 2022 return in 2025? Keep the records until 2031.
Capital property. This is the exception that catches the most people. If you own a rental property, investment portfolio, business equipment, or even your principal residence, keep the purchase records for as long as you own the asset, plus six years after you sell or dispose of it. When you eventually sell, you may need to prove your adjusted cost base to calculate a capital gain or loss. If you bought a rental property in 2010 and sell it in 2028, you need the 2010 purchase agreement, legal fees, and renovation receipts until at least 2034.
Objections and appeals. If you file a notice of objection or appeal to the Tax Court, keep all related records until the matter is fully resolved and any further appeal period has expired. The six-year clock does not start until the dispute is settled.
Estates. If you are the executor of a deceased person’s estate, do not destroy any records until the CRA issues a clearance certificate confirming all taxes have been paid. Without one, you could be held personally liable for outstanding tax obligations.
CRA requests. The CRA can formally request that you keep records longer than six years, typically during an audit or investigation. They will notify you in writing.
Special Rules for Corporations
Corporations follow the same six-year rule for non-permanent records like invoices, expense receipts, and payroll records. However, permanent records, including minutes of directors’ and shareholders’ meetings, share registers, the general ledger, and key contracts, must be retained for at least two years after the corporation is dissolved. In practice, we recommend keeping these indefinitely. If a corporation is dissolved or amalgamated, the six-year rule for non-permanent records still applies from the end of the last taxation year.
Digital Records and Early Destruction
The CRA accepts electronic records, provided they are stored in an electronically readable format for the entire retention period. You can scan paper documents and keep the digital version as your primary record, but the images must be clear, complete, and unaltered. If a document was created electronically, such as an email invoice, it must be retained in its original electronic format. Keep in mind that records stored on servers outside Canada are not considered “kept in Canada” under the Income Tax Act; CRA permission may be required.
If you need to destroy records before the six years are up, you must obtain written permission from the CRA first by submitting Form T137 (Request for Destruction of Records) to your tax services office. Destroying records without approval can result in prosecution. Note that CRA’s permission covers only the legislation it administers, you may have separate retention obligations under provincial employment standards or corporate law.
Quick Reference: What to Keep and for How Long
Standard tax documents (T-slips, receipts, bank statements, invoices, GST/HST records, payroll): six years from the end of the tax year they relate to.
Capital property records (purchase agreements, renovation receipts, legal fees, trade confirmations): for as long as you own the asset, plus six years after disposition.
RRSP, TFSA, and FHSA contribution receipts: for as long as the account is open, plus six years. RRSP contribution room carries forward indefinitely.
Corporate permanent records: at least two years after dissolution. In practice, retain indefinitely.
Estate records: until a clearance certificate is obtained, then six years after the final T3 return.
Tax returns and notices of assessment: the CRA requires six years, but we recommend keeping these indefinitely. They take up minimal digital storage and can be needed for mortgage applications, immigration filings, or future CRA inquiries.
How Cassar CPA Can Help
At Cassar CPA, we help clients across Toronto and Oakville set up organized, CRA-compliant record-keeping systems as part of our ongoing accounting services. Whether you are transitioning to digital records, winding up a corporation, or dealing with a CRA audit, our team can guide you through the process.