FAQ: How long must accounting documents be kept?

Čo v článku nájdete:

• Legislation governing the retention of accounting documents
• How long must accounting documents be kept?
• Retention of tax documents
• Payroll and personnel documents and their retention periods
• How documents are retained — paper or electronic form

Accounting documents serve as evidence of an accounting entity’s economic activity and as a basis for tax and other inspections. The law therefore specifies exactly how long individual documents must be kept and in what form they must be available.

In this article, we look at the statutory retention periods and the form in which documents must be available. Read on for practical information to help you navigate this area and set up the storage of accounting documents simply and clearly.

Legislation governing the retention of accounting documents

The retention of accounting documents is governed by specific legislation. It determines not only the retention periods, but also which documents must be kept and in what form.

The basic legislation is Act No. 431/2002 Coll. on Accounting. It defines what constitutes accounting documents, accounting books and financial statements, and also sets minimum retention periods.

The retention of documents is closely linked to tax legislation, in particular Act No. 563/2009 Coll. on Tax Administration (the Tax Code). This is especially important for tax inspections, during which accounting and tax documents must remain available for several years after the end of the tax period.

In some cases, it is also necessary to take account of special legislation, for example:

• Act No. 595/2003 Coll. on Income Tax,
• Act No. 222/2004 Coll. on Value Added Tax,
• Act No. 395/2002 Coll. on Archives and Registries, or
• employment legislation for payroll and personnel documentation (the Labour Code, Act No. 311/2001 Coll.).

It is precisely the combination of several laws that means retention periods may differ for individual documents.

How long must accounting documents be kept?

Basic retention periods under the Accounting Act

The Accounting Act precisely sets out how long an accounting entity must retain each type of accounting documentation.

Among the most important accounting documents are invoices, cash receipts, bank statements and internal accounting documents. These documents must be kept for at least 10 years.

The same retention period applies to accounting books, such as the general ledger, journal and subsidiary ledgers. These documents must also be archived for 10 years.

Special attention is paid to financial statements. An individual financial statement is retained for 10 years, while a consolidated financial statement has a longer retention period of 20 years.

Important!

These periods represent minimum statutory periods. In practice, other legislation may require certain documents to be retained for longer.

Retention of tax documents

The Tax Code provides that a taxpayer must retain documents needed for the correct assessment of tax for 10 years from the end of the year in which the obligation to file a tax return arose. This mainly concerns documents related to income tax, value added tax and other taxes.

Special rules apply to VAT. A VAT payer must retain tax documents such as invoices, simplified invoices and corrective documents for 10 years from the end of the year to which they relate.

For long-term assets, it is also necessary to remember that documents relating to their acquisition should be retained throughout their period of use and for several years after disposal, as they may affect tax depreciation or subsequent tax inspections.

Tip: In practice, a simple rule applies. If several laws apply to a particular document, the longer retention period is used. This helps prevent problems during a possible inspection by the tax authority.

Payroll and personnel documents and their retention periods

Payroll and personnel documents form a separate group. Their retention periods are generally longer than those for ordinary accounting documents because of their importance for social security, pension entitlements and employment relationships.

The most important payroll documents include payroll sheets and social insurance record sheets. An employer must retain these documents for 50 years, as they serve as evidence when pension entitlements are established.

Other payroll documents, such as payslips, payroll calculation records, contribution statements and documents relating to payroll deductions, are generally retained for 10 years.

Personnel documentation mainly includes employment contracts, agreements for work performed outside an employment relationship, amendments to contracts and documents related to termination of employment. These documents are retained for at least 10 years after the employment relationship ends, although special legislation may set a longer period in some cases.

How documents are retained — paper or electronic form

Accounting, tax and payroll documents may be retained in both paper and electronic form. The law no longer requires an exclusively paper archive, but certain conditions must be met regardless of the chosen format.

For paper archiving, it is necessary to ensure that documents remain legible and complete and are protected against damage, loss or destruction. Documents should be organised clearly and so that they are easily accessible in the event of an inspection.

Electronic storage is increasingly common, especially because it is practical and saves space. Electronic documents must be archived in such a way that:

• they remain legible throughout the retention period,
• the origin of the document can be demonstrated,
• their content remains intact, and
• they are protected against unauthorised interference or data loss.

In practice, a combination of the two forms is often used, with some documents kept on paper and others electronically. The important thing is that the chosen archiving method is consistent, clear and sustainable over the long term.