How Long Do You Need to Keep Receipts? HMRC Rules for UK Accountants

When a client asks how long they need to keep receipts, the honest answer starts with another question: sole trader, partnership, or limited company? The HMRC receipt retention rules are not one flat number, and giving a client the wrong figure for their entity type is an easy, avoidable mistake.

This is a practical reference for the conversation you have with clients, not a general awareness piece. Here is what to tell each type of client, and where the edge cases sit.

Sole traders and partnerships: five years from the filing deadline

For sole traders and partners in an unincorporated partnership, the retention period is five years after the 31 January submission deadline for the relevant tax year. For the 2024/25 tax year, with a filing deadline of 31 January 2026, that means records need to be kept until at least 31 January 2031.

The clock runs from the statutory deadline, not the date the client actually filed. A client who submits early in October does not get a shorter retention window; the five years still runs from the following January.

In short: sole traders and partnerships keep records for five years after the 31 January filing deadline for the relevant tax year, regardless of when they actually submitted.

Limited companies: six years from the end of the financial year

Limited companies face a longer requirement. According to HMRC's guidance on company and accounting records, company records must be kept for six years from the end of the last company financial year they relate to. This is the tax retention period that applies in practice, and it is longer than the three-year minimum set out in the Companies Act 2006 for statutory accounting records, because the six-year HMRC enquiry window takes precedence for anything tax-related.

For a director client, that means invoices, receipts, and expense records connected to a given accounting period need to survive six full years past the year end, not the shorter period they may have seen quoted for basic statutory records. If you advise both sole traders and limited companies, this one-year gap between the two retention periods is worth flagging explicitly, because clients moving from sole trader to limited company status often assume the rule they already know still applies.

VAT records: six years, or ten for OSS and IOSS

VAT adds a separate retention rule that sits on top of whichever entity-level rule already applies. Standard UK VAT records must be kept for six years. For businesses using the VAT One Stop Shop (or the predecessor Mini One Stop Shop) or the Import One Stop Shop for EU sales, the requirement extends to ten years, running from the end of the year the transaction took place rather than from the VAT period.

Getting the record itself right at the point of capture matters as much as the retention clock; see our walkthrough on scanning receipts for business expenses for the practical side of that. In practice, for a VAT-registered sole trader, this means the longer of the two rules governs: while the income tax retention period is five years, VAT records connected to the same transactions need to survive six. The simplest guidance to give a VAT-registered client is to treat six years as the working minimum regardless of entity type, since VAT retention will usually be the longer requirement in the mix.

In short: standard VAT records must be kept for six years, rising to ten years under the One Stop Shop, Mini One Stop Shop or Import One Stop Shop schemes, counted from the end of the year the transaction took place. For a VAT-registered sole trader, the six-year VAT rule outlasts the five-year income tax rule, so six years governs.

What counts as a valid record, not just a receipt

HMRC does not mandate a specific format. What it requires is evidence that clearly shows who was paid, the date, the amount, and what the purchase was for. A till receipt, an emailed invoice, or a card confirmation with an itemised breakdown all satisfy this if the detail is complete and legible. A bank statement line showing only a merchant name and total does not, on its own, because it cannot show what was actually purchased.

For sole trader clients specifically, our companion piece on how sole traders should keep business receipts is a useful one to point them at directly. For VAT-registered clients specifically, this bar is higher again. To support an input VAT reclaim, a valid VAT invoice showing the supplier's VAT registration number is generally required, not just proof of payment. A card receipt without a VAT number will not support a reclaim, even though it may be entirely adequate for the client's income tax records.

In short: HMRC does not require a particular format, it requires evidence showing who was paid, when, how much, and what for. A legible till receipt, an emailed invoice or an itemised card confirmation all qualify; a bank statement line showing only a merchant name and a total does not.

What happens if records go missing before the retention period ends

HMRC can charge a penalty of up to £3,000 per tax year for failing to keep adequate records, separate from any penalty or interest on unpaid tax that results from an inaccurate return. Where records are lost or incomplete, HMRC may accept estimated figures, but treats them with more scepticism than verified records, and a pattern of estimation across multiple periods can itself look like an under-declaration rather than an honest gap.

Getting VAT reclaims right the first time also avoids compounding retention headaches later; our review of common VAT reclaim errors covers the patterns worth flagging to clients. For a client who has genuinely lost a receipt, a bank or card statement showing the transaction is recognised as supporting evidence, though it is weaker on its own because it does not show what was bought. Wherever possible, strengthen it with any other available evidence: a reissued supplier invoice, an order confirmation email, or a contract establishing a recurring cost.

The retention period is a floor, not a safe harbour

The retention periods above answer "how long must a client legally keep records." They do not answer a related but different question: how far back can HMRC actually assess tax. The two are often treated as the same thing, and advising a client to destroy records the moment the statutory minimum expires can leave them exposed if either question was answered wrong.

HMRC's standard time limit to raise an assessment is four years from the end of the relevant tax year. Where a loss of tax was brought about carelessly, that extends to six years. Where it was brought about deliberately, or involves an offshore matter, or a failure to notify chargeability, HMRC can go back twenty years. The five and six-year retention periods above sit inside that four-year standard window comfortably, which is presumably why they were set where they were, but they do not cover the careless or deliberate cases, where the assessment window outlasts the retention period a client was told was safe to work to.

In practice, this matters most for the client whose record-keeping in an earlier year was genuinely weak, not fraudulent, just careless: an estimated figure here, a missing receipt there, treated as immaterial at the time. If that pattern later attracts HMRC's attention, the six-year careless window can reach back past a five-year sole trader retention period that has already lapsed. The practical advice worth giving a client with any doubt about an earlier year's accuracy is straightforward: treat the stated retention periods as the minimum to plan around, not the point at which it becomes safe to destroy everything, and keep anything connected to a return you have genuine doubts about for longer than the statutory floor requires.

What if a client changes accountant or a company is dissolved partway through the retention window

Retention obligations sit with the business, not with whoever happens to be its accountant at the time. If a client moves to a new firm, the six or five-year clock does not reset, and the outgoing accountant has no obligation to keep copies indefinitely on the client's behalf once the engagement ends. It is worth confirming at offboarding, in writing, that the client (not the practice) now holds sole responsibility for retaining records for the remainder of the period.

For a limited company that is dissolved, the retention obligation does not disappear with the company. Former directors remain responsible for keeping records for the full six-year period from the relevant financial year end, even after the company has been struck off. This is a detail that catches directors out more often than it should, and it is worth raising proactively during a dissolution rather than leaving them to discover it if HMRC later opens an enquiry into a defunct company.

Are digital records acceptable across all entity types?

Yes. HMRC accepts digital records, including scanned paper receipts and email receipts, for sole traders, partnerships, and limited companies alike, provided they are legible and show the required detail. This has been the case for some time, but it matters more now than it used to.

Making Tax Digital for Income Tax Self Assessment is rolling out from April 2026. Sole traders and landlords with annual business or property income above £50,000 are already required to keep digital records and submit quarterly updates through compatible software. The threshold drops to £30,000 from April 2027. For clients already inside these thresholds, digital record-keeping has moved from good practice to a compliance requirement, and the retention rules above apply to the digital record just as they would to the paper original.

For practices advising a mixed client base, this is a useful moment to standardise retention advice across the board rather than tailoring it client by client. A digital-first system that satisfies the six-year VAT rule automatically satisfies the shorter five-year sole trader rule too, so there is little value in maintaining two different retention habits across a client list.

Receiptflow gives your clients a simple receipt forwarding workflow that keeps digital records intact for as long as retention rules require, without your team having to chase paper. See how it fits your practice's client base.

Quick reference: retention periods by record type

The bottom line for advising clients

There is no single HMRC receipt retention rule. The period depends on entity type, and VAT registration adds a separate, usually longer, requirement on top. The practical advice for most clients is to default to six years and keep digital, legible records that show who was paid, when, how much, and for what. That single habit satisfies every rule in the table above, and avoids the £3,000 penalty risk that comes with treating retention as an afterthought. Building that habit into how a practice collects records in the first place, rather than reconstructing it at year end, is exactly what a year-end receipt checklist sent to clients ahead of time is for.

Receiptflow keeps client receipt records digital, searchable, and retained for as long as compliance requires. Start a free trial and see how it fits your practice.