Lets’ discuss business documents you should keep on hand. To keep your business organized, you will need to go through your documents, store the important ones, and throw the rest away. But how do you know if you should keep a document or throw it away? After all, businesses deal with hundreds or thousands of documents, so it can be challenging to know which ones you should keep. To help with this issue, you can read on and learn about the business documents you should keep on hand.
Bank Statements
Bank statements provide proof of your business’s revenue. They also allow businesses track and monitor payments and deposits. It is best to keep the monthly statements until you receive the end-of-the-year report. Then, you can shred the monthly statements, but you should keep the end-of-the-year report for at least three years. These statements will protect your business from fraud and financial losses.
Business Invoices
Another document you should save for your company is a business invoice. You should keep your payable and receivable invoices for around seven years. Both payable and receivable invoices are proof that you paid a sum or received goods. When the IRS audits a business, they pay attention to profit and loss statements. The receivable invoices are proof of gross income, and the payable invoices are proof of expenses.
Employee Records
Employee records include resumes, performance reviews, and employee files. If an employee no longer works for your business, you should keep their records for at least seven years after the employment ends. If the employee received worker’s compensation, you should keep the records for ten years. In addition to the employee records, your business should keep payroll tax records. Payroll tax records include benefit payments, timesheets, and employee information. The IRS recommends keeping these tax records for at least four years from the time you filed the return or paid the taxes.
Confidentiality Agreements
To protect your business, you should keep all confidentiality agreements with employees, suppliers, and other business partners. Since the majority of confidentiality agreements contain sensitive information, you want to ensure that you have written agreements to protect your business. Most businesses dispose of their confidentiality agreements when the information is no longer important to the company.
Contractor Agreements
Contractor agreements will save your business a lot of time and effort. These agreements lay out the terms of the contract and ensure that the contractors complete the work. You should keep these agreements for seven years after the contractors complete their jobs. In addition to the agreement, you should keep any correspondence with the contractor for seven years.
These are a few of the business documents you should keep on hand. If you need to dispose of any documents, make sure you use a secure shredder. There are many reasons why it is important to shred your documents, including the fact that shredding keeps your confidential information safe. You do need to keep the documents after a certain period of time, and once that period has passed, make sure you dispose of the documents safely.
