Does Business records — 7-year retention (Corporations Act + tax) apply to sole traders?

Yes. Across every industry and every size band, the engine's answer for a sole trader is: yes.

Does Business records — 7-year retention (Corporations Act + tax) apply to businesses with 1–5 employees?

Yes (1–5 employees, turnover $100K–$1M).

Who must comply with Business records — 7-year retention (Corporations Act + tax)?

The applicability test for Business records — 7-year retention (Corporations Act + tax) (ASIC, ATO, AUSTRAC and FWO), computed across 35 industries, 9 business structures and 6 size bands.

Short answer: Every business

Every business must keep tax and business records for 5–7 years (ITAA 1936 s 262A; Corporations Act s 286)

What the obligation is

Companies must retain financial + business records for 7 years.

Section 286 Corporations Act requires companies to keep written financial records for 7 years. Tax records also 7 years under TAA. Employee records 7 years under FW Regs. CDD records 7 years under AML/CTF Act.

The applicability test

Every business must keep tax and business records for 5–7 years (ITAA 1936 s 262A; Corporations Act s 286)

How the regulator frames it: Companies + employers + reporting entities.

What triggers it: Recording event.

Jurisdiction: Commonwealth law, so the test is the same in every state and territory.

Which industries are in or out

Outcome across the 35 industries Rules Mate maps (35 of 35: yes).

The answer is the same in every industry: yes. Industry does not change who must comply.

Business structure and size

Structure does not change the answer across all industries: for every structure the answer is "yes".

Size does not change the answer across all industries: at every size band the answer is "yes".

Worked examples

Each line is one run of the Rules Mate applicability engine for a single business profile, with the reason the engine gives:

Pty Ltd company in real estate agents with 6–19 employees, turnover $1M–$3M: applies. Every business must keep tax and business records for 5–7 years (ITAA 1936 s 262A; Corporations Act s 286)

What you must do, and when

When due: Continuous retention; 7-year minimum.
Frequency: Ongoing
Evidence to keep: Records management policy + actual retention.
Status: Current
Priority: High

Penalty for not complying

Maximum penalty: Civil penalties; tax + AML enforcement consequences.

Audit or assurance level

Rules Mate has not yet classified the audit or assurance level for this obligation. Any audit, review or certification requirement is set by the regulator source listed below.

Where it sits in the corpus

Rules Mate tracks 1 published obligation tagged "records", 0 of them rated critical. For a professional services Pty Ltd company with 6–19 employees operating in every state, 1 of those apply outright. This obligation is rated high priority, and is an ongoing duty.

Regulator, legislation and tools

Regulated by Australian Securities and Investments Commission, Australian Taxation Office, Australian Transaction Reports and Analysis Centre and Fair Work Ombudsman.

ASIC: Corporate regulator administering the Corporations Act, financial services and credit licensing (AFSL/ACL), markets supervision, insolvency, and registries (ASIC and ABRS).

ATO: Federal tax administrator covering income tax, GST, PAYG, FBT, superannuation guarantee, STP, and self-managed super funds. Also administers the Director ID regime via ABRS.

AUSTRAC: Anti-money laundering and counter-terrorism financing regulator and financial intelligence unit. Administers the AML/CTF Act, including Tranche 2 expansion from 1 July 2026.

FWO: Enforces compliance with the Fair Work Act, awards, and agreements. Investigates underpayments, brings civil penalty proceedings, and publishes compliance notices.

Corporations Act: The foundational federal Act for Australian corporate law.

TAA: General tax administration — PAYG withholding (Sch 1 Pt 2-5), STP, Director Penalty Notice regime (Sch 1 Subdiv 269-B), assessment + objection process, penalties + general interest charge.

Free tools that help with this obligation:

Compliance calendar builder

Check your AML/CTF programUpload the AML/CTF program you already have and get a gap score against the Tranche 2 requirements of the Act and Rules. Personal information is removed before analysis.Run the compliance journeyAnswer a short questionnaire about your business and get the obligations that apply to you, with the reason each one applies.

Questions

Who must comply with Business records — 7-year retention (Corporations Act + tax)?: Every business must keep tax and business records for 5–7 years (ITAA 1936 s 262A; Corporations Act s 286)
Does Business records — 7-year retention (Corporations Act + tax) apply to sole traders?: Yes. Across every industry and every size band, the engine's answer for a sole trader is: yes.
Does Business records — 7-year retention (Corporations Act + tax) apply to businesses with 1–5 employees?: Yes (1–5 employees, turnover $100K–$1M).
When is "Business records — 7-year retention (Corporations Act + tax)" due?: Continuous retention; 7-year minimum.

Sources

Computed by the Rules Mate applicability engine from the published obligation corpus; facts last checked 3 October 2026. Rules Mate is not a law firm and this is general information, not legal advice. Confirm your position with the regulator source or a qualified adviser before acting.