What records do I need to keep in case CRA audits me?

The Income Tax Act is a federal statute that generally requires you to keep records and supporting documents for at least six years from the end of the tax year to which they relate. This is the minimum; keeping records longer is prudent if you have ongoing matters.

For individuals, this means retaining T4s, T5s, RRSP receipts, charitable donation receipts, and receipts supporting any deduction claimed. Self-employed individuals and business owners should also keep invoices issued and received, bank statements, payroll records, business contracts, and mileage logs if claiming vehicle expenses. Electronic records are acceptable as long as they are readable and accessible.

Failure to maintain adequate records is itself a problem during an audit — CRA may disallow deductions for which you cannot produce evidence, and there are penalties for not keeping proper books. Organize records by tax year as you go rather than scrambling to reconstruct them later. If you destroy records early and are later audited, you may be unable to defend your return.