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Last updated 11 February 2019

Record-keeping requirements and retention

If you are carrying on a business, you must keep records relevant for any taxation purpose that record and explain all transactions and other acts you are engaged in. Subsection 262A(2) of the ITAA 1936 prescribes the records to be kept as including:

  • any documents relevant for the purpose of ascertaining a person’s income or expenditure
  • documents containing particulars of any election, estimate, determination or calculation made by a person for taxation purposes and, in the case of an estimate, determination or calculation, particulars showing the basis on which and the method by which the estimate, determination or calculation was made.

You must keep these records for your financial arrangements covered by the TOFA rules, even if you are not carrying on a business for those arrangements.

Generally, the partnership must keep all relevant records for five years after they were prepared or obtained, or five years after the completion of the transactions or acts to which they relate, whichever is the later. This period may be extended in certain circumstances. Keep records in writing and in English. You can keep them electronically as long as the records are in a form that we can access and understand to ascertain your taxation liability – see TR 2005/9 - Income tax: record keeping – electronic records.

Partnership records

Keep the following records:

  • a copy of the partnership agreement – if none exists, a copy of the partnership’s certificate of registration; if none exists, documentary evidence that partners were carrying on their activities as a partnership
  • commencement date of the partnership or the date of reconstitution
  • detailed statement of assets and liabilities
  • details of each partner’s capital accounts and sources of capital contributed
  • details of each partnership bank account including the name and number of the account, the bank and branch at which it is kept, the date the account was opened and the names of persons authorised to operate the account and the date of such authorisation
  • the family relationship of the partners and, if the partners are husband and wife, details of the nature and extent of the services rendered by each to the partnership
  • whether the partners own jointly or in common, any property from which interest, dividends, rents or royalties are derived
  • the names in which business contracts are made
  • details of any services rendered in the production of assessable income by a partner under 18 years old, or by a beneficiary under 18 years old in a trust where the trustee is a partner; details must include the nature, extent and value of the services rendered
  • whether the partnership is constituted or conducted such that any partners cannot, of their own will, deal with any part of their share of the partnership income
  • whether any partners are required to use any part of their share of the profits to meet any debt to another person
  • records that show you have met your choice of superannuation fund employer obligations; for more information, see Super Funds or phone 13 28 64.

See TD 2007/2 - Income tax: should a taxpayer who has incurred a tax loss or made a net capital loss for an income year retain records relevant to the ascertainment of that loss only for the record retention period prescribed under income tax law?

Record keeping for overseas transactions

Keep records of any overseas transactions in which the partnership is involved, or has an interest, during the income year.

The involvement can be direct or indirect – for example, through individuals, trusts, companies or other entities. The interest can be vested or contingent, and includes a case where the partnership has direct or indirect control of:

  • any income from sources outside Australia not disclosed elsewhere on the tax return, or
  • any property, including money, situated outside Australia. Where this is the case, keep a record of:
    • the location and nature of the property
    • the name and address of any partnership, trust, business, company, or other entity in which the partnership has an interest, and
    • the nature of the interest.

If an overseas interest was created by exercising any power of appointment, or if the partnership had an ability to control or achieve control of overseas income or property, keep a record of:

  • the location and nature of the property
  • the name and address of any partnership, trust, business, company, or other entity in which the partnership has an interest.