Just living these days has legal and tax implications in terms of information that SARS and other authorities require.  But once submitted what happens next, can these records and documents be destroyed or erased.  The following is determined by legislation, depending on the coinciding event which the records have relevance to:

1. Taxation records and documents

  • Returns and relevant documents submitted to SARS – 5 years from the date of submission
  • Documents relevant to returns that were not submitted – Indefinitely until submission, then the 5 year rule applies
  • A taxpayer that was not required to submit a return but carried on an activity subject to tax including activities leading to capital gains – 5 years from the end of the relevant tax period
  • Where records are subject to a SARS audit or investigation – 5 years from the date on which the documents were submitted and the assessment or decision is finalised
  • Where a person raises an objection or appeal to an assessment – 5 years from the date on which the documents were submitted and the assessment or decision is finalised
  • Employee records (as listed below) in the employer’s posession – 5 years from the date of submission of the EMP501
    • Amount of remuneration
    • Employees tax deducted or withheld
    • The employee’s tax reference number
    • The relevant employer reconciliation return (EMP501)
  • Records (listed below) for a registered micro business – 5 years from the date of submission or the end of the relevant tax year
    • Amounts received by the micro business during the year of assessment
    • Dividends declared by the micro business during the year of assessment
    • All assets with a cost price in excess of R10 000
    • Each liability with a value in excess of R10 000
  • Records (as shown below) used by a VAT vendor – 5 years from the submission of the return
    • Record of all goods and services
    • The rate of tax applicable to the supply thereof and the suppliers or their agents
    • Invoices
    • Tax invoices
    • Credit notes
    • Debit notes
    • Bank statements
    • Deposit slips
    • Stock lists
    • Paid cheques
  • Documentary proof confirming a zero rating of supplies – 5 years from the submission of the return
  • Records (as listed below) of importation of goods and services – 5 years from the submission of the return
    • Bill of entry or other documents prescribed by the Customs and Excise Act
    • Proof of payment of VAT to SARS
  • Should a VAT vendor change their basis of accounting lists of all debtors and creditors at the end of the tax period immediately before the change – 5 years from the submission of the first return on the new basis of accounting

2. State Owned Entities

  • General Ledger, cash books and similar records – 15 years
  • Internal audit reports – 10 years
  • Main transaction summary, general journals and other transaction summaries – 10 years
  • Primary evidentiary records (invoices, pay sheets, etc) – 5 years
  • Source documents: general and incidental source documents – 5 years
  • Subsidiary ledgers, inventory cards and records on assets or liabilities after maturing – 5 years
  • Supplementary accounting records – 5 years
  • System appraisals – 10 years

3. Labour relations

  • Bargaining council records (listed below) as well as Registered trade unions and employers’ organisations – 3 years
    • Books of account
    • Support vouchers
    • Records of subscriptions paid by members (where applicable)
    • Income and Expenditure statements
    • Balance sheets
    • Auditor’s reports
    • Minutes of meetings
  • List of members of registered trade unions and employers’ organisation – indefinite
  • Ballot papers – 3 years
  • Records regarding collective agreements and arbitration awards in the posession of the employer – 3 years
  • All employer held records of strikes, lock-outs or protests by employees – indefinite
  • Records of disciplinary transgressions, actions and reasons for actions taken by employer – indefinite

4. Employment Equity

  • Employment equity plan where more than 150 employees are employed – 3 years after expiration of plan
  • Employment equity plan where less than 150 employees are employed – 2 years after expiration of plan

5. Basic Conditions of Employment

The employer is required to keep the following records for 3 years:

  • Written particulars of employee after termination of employment
  • Employee’s name and occupation
  • Time worked per employee
  • Remuneration paid
  • Date of birth of any employee under the age of 18 years old

6. Liquidation or Insolvency

All books, records and documents relating to a liquidated estate – 6 months after confirmation by the Master of the High Court of the final trustees’ account.

The above list is not complete, but it does present a good idea of what is expected of employers, employees, businesses and individuals in terms of the various pieces of legislation which we adhere to in our every day lives.  It is always of import to have proof of events handy but if you are compliant with the above you need not have rooms and rooms full of documents gathering dust.

For any specific queries our lines and doors are always open.