Do you have to keep a copy of the sales and invoices?
It is the business's responsibility to maintain a complete set of documents with regards to the sales and purchases. You are not suppose to claim any business expenses without a copy of the supporting paperwork. Regarding GST, the law states that if the price is greater than $82.50, you cannot claim the GST unless you have the invoice showing the GST clearly on the invoice.
Is it permissible to maintain electronic copies of your documents?
Yes, and in fact it is encouraged, as long as:
The records have not been manipulated or altered.
IMPORTANT - originals must be intact. -- Save original versions of any legal documents (including invoices) before you modify, or add notes to.
If you change your system, you still need to access the original data.
You do not need to keep paper records, unless a particular law or regulation requires a paper copy of a particular document.
Backups and Security
If you maintain an electronic document system, then you must:
Have your computer securely protected, by using password protection on your operating system.
Have all files backed up and securely protected.
Have a copy of all the files maintained offsite, preferably automatically on a cloud system.
Be able to demonstrate that you have control of all incoming and outgoing data.
Protect the data from ransomware, viruses, hackers, and tricksters.
What are the rules for keeping historical data?
The general rules are as follows:
The data must be kept for a minimum of four years from the date the activity statement was lodged. (Seven years for payroll data.)
The document must be legible - remember thermal receipts fade, and once faded are in-admissible evidence.
The documents must be kept in an easily accessible form, i.e. a PDF file.
The file structure must be organized. You must be able to find it when four years later, you are asked for the document.
The document saved must be a valid invoice or receipt. i.e. a TAX INVOICE. By law, you must not claim items you have no legal receipt for.
Legal receipts must contain:
If a Tax Invoice, the title "TAX INVOICE" printed clearly on the document.
The Sellers identity.
The Sellers ABN, (ps. your responsibility to check annually the GST and ABN registration status).
The date the invoice was issued.
The amount of GST, or statement "the total price includes GST".
The itemized description of what is being purchased.
The value of the items being purchased.
And if the invoice is more than $1000:
The quantity of each item being purchased.
The name and address of the party being supplied the goods.