Maintain these Records and Books of Accounts for VAT Compliance: FAQs

What records and books of accounts must be maintained for VAT?

The following should be maintained for VAT purposes:

• Original tax invoices received by the taxpayer
• Copies of tax invoices, credit and debit notes issued by the taxpayer 
• Accounting books containing the transactions in chronological order 
• Balance sheet
• Profit and Loss account 
• Records of payroll
• Records of fixed assets 
• Inventory records for each tax period 
• Customs documents for import and export transactions carried out by the taxpayer
• Additional records (if any) prescribed by NBR

How long should I maintain VAT records?

A taxable person must maintain organised records, tax invoices and accounting books related to their supplies and imports of goods and services for at least 5 years from the end of the tax period in which they were issued. 

Records related to capital assets must be maintained for 5 years from the end of the tax period which also marks the end of the adjustment period for these assets.

As for real estate properties, the invoices, records, and accounting books must be maintained for at least 15 years from the end of the tax period in which they were issued.

Will I be asked to present my firm’s financial records in case of an audit?

Yes, the taxpayer must retrieve and present their records and books to the tax authority upon request. The NBR officials have the right to review the accounting system used by the taxpayer to maintain their firm’s records and books of accounts.