Tax Tip 7: keep All Receipts forever

Photocopy the receipt as soon as you get home from the shop & scan it digitally as a PDF. Easy

 

Xero and MYOB are not software that keeps copies of receipts (but they now can). They just record ins and outs through the bank. I can do a withdrawal and tag a receipt for the same amount. All taxpayers should consider cash, card and conventional payments and reconcile to their register and bank account and also address receipts and other documents.

 

I think is really easy to use your phone camera to take photos of your receipts then it will upload automatically to the cloud.

Assuming you have cloud setup in your phone. Then you will never lose it. Possible better for backup.

 

A photo of a receipt is one part of the process. The original may not need it but a copy will require the proof of payment unless its a small cash payment. Apps are not the solution to all world problems since the iphone was invented. You think contractors dont share these images thinking they have outwitted the ATO ??

 

I have an Epson DS-560 wireless scanner next to my Mac. Much more compact and convenient to use than my old flatbed.

This is a compact and fast little scanner that can handle double-sided stacks of A4 or smaller documents such as some receipts.

I have rules setup for scanning to specific folders.

http://www.epson.com.au/products/scanner/WorkForceDS-560.asp

I was lucky to get a factory-refurb unit and a much better price than retail.

 

Best solution I have found so far is Evernote - I have the app on my phone and PCs. I email from my scanner direct to my @evernote.com email address, forward invoices via email or take a picture from my phone. It then syncs to all of my PC's, Tablets, phones etc.

If you have the pro version, it does OCR so you can search your documents for keywords (handy). You can also tag/file.

All of these cloud services are actually sync services - I do a regular export to a local USB drive as a backup. Simple menu option to do so.

RE: Security. Two factor authentication (e.g. SMS) gives some piece of mind but still avoid scanning anything really sensitive.

 

How about documents for selling shares >7 years ago? They caused capital losses that’s still carried forward in the tax return to this day. Should we keep them forever?

 

It wouldn't hurt. If the loss is still carried forward you would need to keep the receipts so that you can use the loss to offset future gains.

 

My drop box was infiltrated by a computer virus by very clever criminals. This made my account useless. Please do not rely on drop box for backing anything up.

 

@Terry_w's advice to keep good records is good advice. My parents are having an issue with this right now.

In 1999 they bought an IP in Melbourne. They sold the IP in 2016. Dad did the dad thing and kept the tax records for 7 years then disposed of them.

Now it is time to calculate the cost base and there are no records of:-

- purchase price
- stamp duty
- building and pest inspection
- solicitor's fees
- capital expenditure
- other costs I have not thought of

This could result in them paying significantly more tax on the sale of the property than they need to.

Personally, I have a lever arch file for each property. I put all of the documents relating to the property in that folder and keep them. They can be disposed of 7 years after lodging the tax return after the sale of the property?

 

I still have an arch lever folder here on a property that I sold 20 years ago - not sure why!

And a lot of people who move into investment properties will be caught out too, because most don't realise they can use various costs incurred while living in it to reduce CGT.

 

i do keep hard copy for 2003-2010 but these days, I just scan and save it in a harddisk and easier for me to pass to accountant given I am in overseas. I have set up all receipts by email.

 

I use a ScanSnap to turn documents into PDFs. They are OCR’d and stored on my hard drive which is then pushed into the cloud.

FUJITSU Image Scanner ScanSnap iX500 - Fujitsu Australia

 

Sounds complex. Copy is scanned as a pdf and scanned. Any folder is easily syncd to a cloud drive

 

They should make it so that little suckers don't fade when stored

 

Those thermal receipts are rubbish and are always best quickly scanned. They go black on a hot day in the car. They fade in plastic sleeves and when they touch another thermal printed receipt. Greasy fingers and they become transparent.

Fun fact - One company holds rights to that paper. *******s Inc.

 

any reason why is that paper used on receipts quite often?

 

Purchase price will be easy, it will be public record.
Stamps you should be able to find th eold rate...but
Solicitor may still have file possibly - ask.
B&P no biggie

The costs and improvements are the big ones, most should be on PM statements, you can also request old acc records if they paid via bank, if cash, you could likely work it out and claim less to be safe (council should know rates)

But yeah, it makes a lot of work. I think many of us have done things the hard way, that is how you learn the easier ways if you keep doing it, but people with one IP prob better just living life anyway and paying a bit more..

PS old returns will have the years claimed amounts.

 

Because it's thermal paper ... saves the issuer having to stock ink as well as paper.

 

Its what banks give merchants...for free. Its ink free. Modern merchants use online systems. No paper. New osko system will change bpay from paper bills