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“How many years do I need to keep my tax returns for?”
6 Years!!! Sounds like a simple answer, right? Unfortunately, no.
The 6 years starts from the time that you are assessed by CRA which is the date of your notice of assessment you receive after filing. i.e. 2018 personal taxes were assessed on April 30, 2019 so you need to keep them until April 30, 2025. If you are reassessed at any point, the 6 years for that tax year starts from the date of reassessment. Using your 2018 taxes again, your notice of reassessment is September 30, 2019 so you will need to keep your 2018 tax documents until September 30, 2025.
Remember, this doesn't just include your tax return. You need to keep ALL supporting documents whether it be donations, medical & dental, childcare, rental expenses, business expenses if you are a sole proprietor, etc. Not only are you required to keep these receipts, you might also be required to keep cancelled cheques and/or bank/credit card statements to support these amounts (very common in separation/divorce situations and are almost always asked of everyone going through this).
If you have had no reassessments to any of your tax years and you have filed every year on time, you should be able to shred your tax documents relating to 2012 and earlier. But DO NOT get rid of any permanent documents for assets in which you still own; i.e. homes, rental properties, capital assets for your business, purchase documents of stocks, etc.
Prior to shredding any important tax information, you should always seek the advice of a professional.
Have a question? Email or call us. And remember to check out our blogs, checklists and social media pages for more information on all things small business, tax, accounting and the Tri-Cities community.
***This blog is for information only and not to be used as tax advice or planning without first seeking professional advice. Information is subject to change without notice.