Every entrepreneur runs into it sooner or later: boxes full of old invoices, annual accounts and bank statements that need to stay somewhere. But for how long exactly? The law sets clear requirements here, and anyone who does not comply risks trouble during a Tax Authority audit. In this article we explain exactly what the retention obligation involves, which term applies to which documents, and how best to organise this in practice.
Short answer
The main rule is that entrepreneurs must keep their records for seven years. For data on immovable property, such as your business premises, a longer term of ten years applies. This retention obligation applies to virtually all basic data of your business, both on paper and digitally, and is intended to enable the Tax Authority to check your returns.
What does the retention obligation involve?
The statutory retention obligation is laid down by law and means that entrepreneurs are required to keep their records in such a way that they can be checked at any time within the retention period. This concerns not only invoices, but all data relevant to taxation. Think of:
- The general ledger and the balance sheet.
- The accounts receivable and accounts payable administration.
- The purchase and sales records, including invoices and receipts.
- Bank and cash data.
- Payroll records, if you have staff.
- Contracts, correspondence and other documents relevant to your tax returns.
As long as data is still current, it belongs to your ongoing administration. Only once the current relevance of a piece of information lapses does the retention period for that document start running. A current lease agreement is therefore kept for as long as it is valid, and only after termination does the count of the retention period for that contract begin.
Why exactly seven years?
The seven-year term aligns with the period during which the Tax Authority can generally still issue additional or corrective assessments for earlier years. By observing this period, the tax authorities can check during an audit whether earlier returns are correct. For core data such as the general ledger, the accounts receivable and payable administration, and the purchase and sales records, the seven years applies in full: you may not destroy these basic records earlier, not even if you make agreements with the Tax Authority about a shorter retention period for less essential documents.
The exception: ten years for immovable property
For data on immovable property, such as the purchase, renovation or sale of business premises, a longer retention period of ten years applies. This is related to the VAT revision rules for immovable property, which run over a longer period than for movable property. An example: an entrepreneur who purchased business premises in 2019 and offset the associated VAT must keep the invoices and underlying documents of that purchase until the end of 2029, even though the regular seven-year term for other records has long since expired. Certain data related to the so-called One Stop Shop scheme for cross-border VAT also has a deviating retention period of ten years.
Paper or digital?
The law does not prescribe in which form you must keep your records: both paper and digital storage are in principle allowed. What matters is that the data is checkable and legible for the Tax Authority within a reasonable time. If you keep documents digitally, make sure you also retain the software or file formats with which that data can be accessed, so that an auditor can actually review the records. Some entrepreneurs make arrangements with the Tax Authority about the exact form in which data is kept, for example when a particular system is being phased out.
A practical example
A sole proprietorship in hospitality still keeps the purchase invoices from its supplier from 2019 in a digital archive, because the seven-year retention period for these invoices does not expire until the end of 2026. That same entrepreneur bought the premises housing the business in 2020. The invoices and notarial documents of that purchase must be kept until the end of 2030 because of the extended term for immovable property, even though the regular business invoices from that year are by then already seven years old.
What happens if you don't comply with the retention obligation?
If an entrepreneur is unable to produce certain data during an audit, the Tax Authority cannot properly check the return. This can lead to an estimated tax assessment, with the burden of proof shifting to the entrepreneur to show that the estimate is incorrect. Failing to comply with the retention obligation can therefore have unpleasant financial consequences in practice, even if there was nothing substantively wrong with the return itself.
How to approach this in practice
It is wise to work structurally with a digital bookkeeping system in which invoices, receipts and bank transactions are automatically archived. This prevents you from having to search for loose documents during an audit. Also keep an overview of documents that fall under the extended ten-year term, such as purchase files for business premises, so you don't accidentally delete them earlier than the rest of your records. If you are unsure about a specific document, it is better to keep it a bit longer than strictly necessary: the cost of extra digital storage usually does not outweigh the risks of incomplete records.
Frequently asked questions
Does the retention obligation also apply to sole traders and small businesses?
Yes, the retention obligation applies to every entrepreneur required to keep records, regardless of the legal form or size of the business. A sole trader with a sole proprietorship must also keep records for at least seven years.
Do I also have to keep emails and quotes?
Correspondence and quotes that are relevant to taxation, for example because they substantiate an invoice or transaction, in principle also fall under the retention obligation. If in doubt, it is wiser to keep a document than to delete it too soon.
Can I make agreements with the Tax Authority about a shorter retention period?
For certain, less essential data, the Tax Authority may agree to a shorter retention period or a specific form of retention. The core data, such as the general ledger and the accounts receivable and payable administration, must however always be kept for the full seven years.
What if my bookkeeping software is discontinued or I switch systems?
In that case, make sure you export the data to a readable format or retain access to the old system, so that the records remain checkable within the retention period. This is indeed checked during an audit.
Does the seven-year term still apply in 2026?
Yes, the seven-year retention period, with the extended ten-year term for immovable property, is still the applicable main rule for 2026 as well. It is always wise to consult the Tax Authority's current information if in doubt, since specific rules can change.
Want to be sure your records are in order and comply with the retention obligation? See how we can support you with this.
More information on the exact retention periods can be found at the Tax Authority.
