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  • Banking records – business

    Your banking records form an essential part of your overall business records as they show money coming in and out of your business. You should record all the amounts you have actually received and paid. You should also regularly reconcile your records so you understand exactly what money goes through your account and why.

    If applicable to your business, you should bank all your cash sales income into your business account when you receive it, to ensure accurate record keeping and GST reporting.

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    Banking records required

    Banking records information and examples

    Information your records need to show

    Examples of types of records

    • Payments received electronically including:
      • tap-and-go (contactless)
      • EFTPOS
      • credit and debit cards
      • online payments
      • smart phone and tablet card processing
    • Payments made electronically
    • Amounts withdrawn
    • Amounts deposited 
    • Cheque butts or payment records
    • Bank statements
    • Merchant facility statements (for EFTPOS and credit card facilities)
    • Credit card statements
    • Loan or lease agreements
    • Deposit slips, books or records

    How long to keep banking records

    Banking records need to be kept for five years, starting from when you prepared or obtained the records, or completed the transactions or acts those records relate to, whichever is later.

    You should keep records long enough to cover the period of review (also known as the amendment period) for an assessment that uses information from the record.

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    Separate bank account

    If you're operating a business through a partnership, company or a trust, you must have a separate bank account for that business.

    If you are operating as a sole trader, you don't have to open a business bank account, but it's better if you do. That way you can easily separate your business transactions from your personal ones, including any cash taken from money your business receives (often referred to as 'drawings').

    Tips for banking records

    We recommend you:

    • regularly bank all the money your business receives so your income and expenses information is always up-to-date and you can easily reconcile your accounts and analyse your cash flow
    • register for internet or online banking – this may simplify your record keeping and bank reconciliation process as you can
      • easily get detailed records of your business transactions
      • usually download financial information from your online account to the accounting package of your choice
      • identify extra transactions in your account including bank fees or interest charges, and direct debits and credits
      • check and record any errors or omissions.
    • regularly reconcile your bank records, which may help
      • you be more confident that your records contain all the information you need to prepare your tax return and activity statements
      • you to better understand your cash flow
      • reduce the time it takes to prepare your activity statements or tax returns.

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    Last modified: 09 Dec 2019QC 60734