The regulations with respect to the documents you need to keep on file for tax purposes are very clear. You need to keep all documents related to your tax situation at least seven years. This implies that when you have a company, you need to keep the invoices on record for seven years. For the income tax return the documents for seven years.
Sometimes you receive an invoice in PDF via email, instead of regular mail. With respect to the PDF email the requirements are slightly different. You need to keep the original email on file for the seven year period. The reason is that in a PDF file you could make a change, therefore the original message needs to be kept, a print on file has no value. The tax office has then the opportunity to check on the side of the sender if the PDF file has been altered or not.
Backup and tax
We recently learned that the court of justice is very rigid on backing up the documents. If you have not or not adequately made a backup of your files, then you have a problem.
Some tax payers have the opinion that if they put their office or shop or showroom on fire, including the bookkeeping, that then their issues with the tax office are solved, as the bookkeeping was burned as well.
Some tax payers who claim always to keep the bookkeeping, for a seven year period mind you, in their car and either the full car was stolen, the car burned down or someone stole the bookkeeping (?).
Some tax payers claim the dog ate the bookkeeping, again seven years of bookkeeping, what dog can that be? Our dog does not fancy paper, hard drives or CD rom. Maybe a quick bite, but not continuously till the seven year period bookkeeping has been digested.
What ever happened with the original bookkeeping, the court expects you to keep a backup of the bookkeeping and to keep that backup at a place that cannot burn down simultaneously with the original bookkeeping. If the bookkeeping and the backup are not available, then the tax payer still needs to proof the tax office is incorrect.
Ex officio tax assessment
The tax office will issue an ex officio assessment based on what they think you could have earned. Most of the time that ex officio assessment is substantially higher than what it actually should have been the amount. That is done to trigger you to provide the correct details after all. But if you set fire to the administration, then you cannot proof the ex officio assessment is incorrect. Hence you gone from a bad place to a worse place.
Orange Tax Services
Tax problems are not solved by not opening the blue envelopes you receive nor by putting your house or company on fire. The tax office has seen these circumstances before and are not really impressed. They might be pitiful, but we learned the court does not have such feeling. The court decides on facts and circumstances based on the legislation. If you cannot proof a case due to incompetent situations, you lose the court case.
We hope the above makes you aware of keep track of a solid backup and that you keep your records on file for at least an eight year period.
The dog in the picture was made available by: fabusfitclub.com