Tax season can feel crazy, especially when you’re swamped with receipts and old returns. Before shredding any documents, it is essential to know the required retention period for tax records in Canada. Getting it wrong could cost you a missed refund, a denied claim, or an audit.
The CRA has rules on how long to retain your tax records, and failing to adhere to them can cause problems. You should keep your tax files for at least six years. If you’re self-employed, own property, or have unreported income, keep these records for longer.
In this guide, we will explain how many years to keep tax records, what papers to save forever, and how to organise them. Stay on the right side of the rules, avoid fines, and keep your money safe. Let’s get started!
CRA Official Record Retention Requirements
Here’s what you need to know about keeping your tax records in Canada, according to the CRA:
Keep your tax records for at least six years. The clock starts ticking at the close of the tax year, not when you file. So, if you filed your 2024 return in April 2025, keep those records until at least the end of 2031.
What counts as a record? It’s not just your tax return. It’s any paper that backs up what you put on your return:
- T4 slips
- Donation receipts
- Medical expense receipts
- RRSP statements
- Bank and credit card statements (if they show income or deductions)
Digital copies also work. Just be sure they’re easy to read, accessible, and backed up.
Why six years? The CRA might:
- Audit your return later on
- Reassess your filing if new information becomes available
- Ask for proof if something seems off
Following these rules means you’re ready if the CRA comes calling. Keeping records isn’t just a formality; it’s a way to dodge penalties and have one less thing to worry about.
What Records Should You Keep?
Knowing how long to keep your tax info is essential, but so is knowing what to keep. The CRA wants you to keep more than just your tax return. They want a full view of your finances that supports everything on your tax forms.
1. Tax Returns and Assessment Notices
Always save copies of your tax returns and the CRA’s assessment notices. They form the basis of your tax history and may be required if the CRA audits a prior year. They also allow you to view and track any changes or re-evaluations.
2. Receipts for Write-Offs and Credits
If you claimed expenses such as medical costs, donations, or home office write-offs, save all the related receipts. These documents will support your claims, and the CRA may request them later to verify your qualification.
3. T-Slips, Receipts, and Bank Records
Keep all your T-slips (T4, T5, T3, etc.) with invoices or bank records showing interest, dividends, or income. These back up your reported income and withheld taxes, which is key if you’re audited.
4. Records for Investments or Property Sold
Did you sell a home, stock, or something else? Save records of the original buy and the final sale, plus any records of upgrades or selling costs. These figure out your gain or loss and should be kept, especially if you’re claiming write-offs.
5. RRSPs, RESPs, and Investment Money
For accounts like RRSPs, RESPs, or TFSAs, save all records of deposits and withdrawals. These support what you claim each year and help you track deposit limits and avoid penalties for putting in too much.
Special Considerations
While the CRA usually wants you to keep your tax info for six years, sometimes you need to hold on to it longer. So, is six years always enough? Nope. Knowing when to retain records longer is crucial, especially if you have a complex tax situation.
1. Keep Records Longer If You’re in a Dispute
If the CRA is auditing you or you’re in a tax dispute, keep all related papers until everything is sorted out, even if it takes more than six years. Getting rid of documents while there’s an open case can mess up your defence and drag things out.
2. Late or Amended Returns
If you file late or make changes to a return you have already sent, the six-year rule starts when the CRA receives the return or correction, not from the original year. People often overlook this, which could result in a fine if they discard old records too soon.
3. Foreign Income or Assets
If you’re reporting money, investments, or property from other countries, the CRA will look closely at your return. It’s a good idea to keep detailed financial records for more than six years. You might need these papers if there’s a global tax review or if countries share information.
4. Deceased Taxpayers and Estates
If you’re dealing with someone’s estate, the CRA advises keeping their records for at least six years after the estate is settled. Executors or trustees should ensure the estate’s financial history is accurate if the CRA requests a review or requires additional information.
5. CRA’s Statute of Limitations: The Fine Print
The CRA usually has three years to recheck a return (after that, they need a good reason). But for things like fraud, there’s no time limit. Therefore, knowing how long to retain your tax records isn’t always straightforward.
Practical Tips for Organising Your Tax Records
After determining how long to retain your tax records, the next step is to organise them effectively. If you have a system, it can save you time when tax season arrives and help you stay calm if the tax authority asks questions. Whether you prefer paper, digital, or a combination of both, these tips can help you stay in control.
1. Organise Folders by Year and Type
To keep things simple, try sorting your files by year first. Within each year’s folder, create separate folders for different types of documents such as income statements, receipts, notices, and write-offs.
2. Use Tax Apps or Online Tools
Going digital is more than easy; it is smart. Apps like Hubdoc, Evernote, or Google Drive allow you to scan and store receipts, sort them by type, and search for specific words. Just be sure your digital tools have backup plans and safe access. These apps can help you keep track of your paperwork as you decide how long to keep personal tax records, based on the tax authority’s advice.
3. Maintain a List for Each Tax Year
Before filing, create a list of paperwork for each tax year. It should include items such as T4s slips, medical receipts, RRSP slips, charitable donations, and your Notice of Assessment. This list helps you stay on track and serves as a source if you need to fill in any missing information later.
For more about the tax records, you can safely contact Accounting for Realtors today.
Conclusion
Keeping your tax records isn’t just a rule; it’s your duty. Understanding how long to keep your personal tax info can save you from audits, fines, and worry. The CRA typically states six years, but some cases require longer storage.
Whether you file things traditionally, go digital, or use yearly checklists, the point is to stay ready and organised. A bit of work now can spare you trouble later.
