It is essential you maintain all records associated with establishing, running and promoting your company.
You’ll need to keep records so that you can use information from them for your next tax return. For example, if you claim a loss carried forward from a business activity in a previous year, the documents used to work out the reduction.
The Australian Securities & Investments Commission (ASIC) requires businesses to maintain records for seven years. Its recommended you check the recordkeeping requirements of bodies that you have dealings with.
Keep records of money transactions
Some companies intentionally hide income to avoid paying the correct amount of tax and superannuation. They generally do so by not reporting or recording all their cash transactions.
This is known as the hidden economy, and it is unfair to everyone doing the right thing.
The ATO’s primary aim is to promote fair competition in business and decrease the unfair advantage some companies have when they do not correctly report or record all their income and expenses.
Penalties can be applied if you’re engaging in money and hidden market activities, like working off-the-books and failing to report cash transactions.