All small business owners are recommended to keep any invoices they create in case they are audited and need to prove the validity of profit. You can be fined £3,000 by HMRC or disqualified as a company director if you don’t keep accounting records.
You might even have to keep them up to 6 years if:
- they show a transaction that covers more than one of the company’s accounting periods
- the company has bought something that is expected to last more than 6 years e.g. machinery
- you sent your tax return late
- HMRC has started a compliance check into your company tax return.
Even if these don’t apply to you, it’s still better to keep your invoices in a safe place so that if a dispute arises between the company and a client, it’s also good to have all the invoices saved so they can be quickly accessed and the matter solved. By keeping your invoices as organised as possible, you can better balance your budgets as well as manage your business’ accounts payable and accounts receivable functions.