Will HMRC accept scanned receipts for business expenses?
This article was first published on 20 November 2013 and was last updated on 29 September 2016.
When you’re running a business, do you have to keep paper copies of all your receipts, or will HMRC accept scanned copies?
The answer is surprisingly simple: in most cases, the answer is yes, HMRC will indeed accept scanned copies!
Watch out for these exceptions
Naturally there has to be an exception, and that is when you receive documents that show tax that isn’t VAT - for example, bank interest certificates, or dividend vouchers. These documents have to be kept in their original form - so that means that if you receive these in paper format, you’ll need to retain that paper.
If, however, you receive these documents in an electronic form (for example, you’re emailed a .pdf dividend voucher by a company in which you own shares), you can keep that .pdf file - you just can’t change it to another format, like an image.
Don’t forget the back of the receipt!
Also, when you’re scanning your documents, if you receive a document that has information on the back as well (such as a bill with terms and conditions on the back), then you have to scan both sides.
Managing your scanned receipts
To scan your receipts, consider investing in a scanner such as Doxie, which is small, can work wirelessly, and produces manageably small file sizes. Alternatively, you could even send your receipts to a service like Receipt Bank and let them do the scanning for you.
To make it easy to find your receipts later on, set up a structured folder layout that will be easy to keep up-to-date. For example, if you don’t have many receipts in a year, you might create a subfolder for each supplier to save your receipts into. If, however, you need to store a lot of receipts, you might find it easier to create a folder for each year, then subfolders for months, then save receipts into subfolders by supplier.
Use a backup service
HMRC require you to retain your records for a number of years so when you scan receipts, you should be confident that they’re backed up securely. You can use a service like Depositit to back up those folders online daily. To find out more, take a look at HMRC's requirements for limited companies and sole traders.
You don’t have to scan - take a snap instead!
Finally, don’t forget that managing your receipts doesn’t have to be about sitting at a desk and scanning pieces of paper - why not just snap a photo of that receipt on your smartphone as soon as you spend the money? If you’re using FreeAgent's mobile site or its iOS or Android app you can just attach the receipt image to your expense entry. Job done, and no desk required!
More expenses tips:
- You deserve better: why you need to break up with your spreadsheet
- Simple ways to save yourself future Self Assessment stress
- Making Tax Digital consultation response published
- Not feeling (a) fine? You might have a ‘reasonable excuse’ for not completing your tax return
- Don’t be caught out by the Self Assessment deadline!