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Top Tips for Keeping Business Receipts Organized

business receipts

“Would you like a receipt?” We hear this question so often in daily life, we almost just tune it out with an automatic “No thanks.” But, keeping track of your receipts is actually very important, and not just to make things easier at tax time either.

It’s crucial to keep receipts for all expenses whether you’re a small business owner, someone who is self-employed and deducting business expenses on your tax return or an employee working from home who has chosen to claim home office expenses under the detailed method. Otherwise, you risk having an uphill battle with the Canada Revenue Agency should it contest the legitimacy of your deductions.

“Would you like a receipt?” We hear this question so often in daily life, we almost just tune it out with an automatic “No thanks.” But, keeping track of your receipts is actually very important, and not just to make things easier at tax time either. But as busy as we all are, and given that so many transactions are digital these days, what’s the best way to gather and store all these receipts? That’s what we are going to take a closer look at here today.

You CAN Go Digital

Nowadays, the majority of our everyday tasks can be completed online, so why not record keeping? The good news is that when it comes to filing taxes, the CRA accepts scanned or digital receipts. To ensure that your digital file system complies, there are only a few conditions:


  • The electronic storage device (such as a hard drive, flash memory, or app) should be kept for as long as it is thought necessary to respect tax rules.
  • You should be able to index, save, retrieve, and make copies of the receipts using the electronic storage system you chose.
  • Receipts and tax documents must be carefully and precisely reproduced in the identical details as the originals.


An electronic storage system is one that “either prepares or keeps your records via electronic imaging or by transfer to an electronic storage media,” according to the CRA. To back up receipts you scan into your phone or computer, you might elect to buy a scanner (available at any office supply store) and an external hard drive or a flash memory card.

Alternatively, if you’d rather preserve written records, these can be readily added to a spreadsheet for improved organizing. Whatever you choose, be careful to record information from the whole receipt. This contains the time, the company’s address, and the total cost of the purchase.

As an alternative, you can arrange and preserve your receipts using a receipt-tracking program. You can find a very helpful list of some of the most popular – and affordable – ones here.  

Keep Notes, Not Just Receipts

A big advantage of working for yourself, in addition to setting your own hours, is the ability to write off business expenses. If you have a lunch meeting with a client, you can claim the cost as an expense when filing your taxes. However, you can understand how it would become a problem if you give the CRA just a receipt from a restaurant without any notes on the reason for the lunch.

You should be able to substantiate each company expense you include with a variety of supporting paperwork. This doesn’t just apply to receipts and bills; you could also be asked for other details like the attendees and the meeting’s objectives.

You should develop the habit of taking notes because of this. Before snapping a picture, scanning, or putting the receipts in a file folder, you can add these notes straight to the original receipt. Just make sure you record enough details so you can remember what the expense was for weeks or months from now.

You can also log your expense receipts and any notes you want to include in Microsoft Excel or Google Sheets in addition to the tools described above. You might wish to take note of the following information:


  • Date
  • Location
  • Total paid/cost
  • Expense category (e.g., rent, travel expenses, office supplies, marketing)
  • Purpose
  • Who/what/where


Categorize Your Receipts

Why not organize your receipts into categories as you develop the habit of recording your expenses and making notes?

You’ll save a ton of time by doing this come tax season.

The list below includes many business expense types that you can encounter as a freelancer, independent contractor, or consultant.

  • Advertising and marketing expense: This category can include the cost of your business cards, posters, website development and maintenance, and monthly fees to job boards, such as Upwork.


  • Office supplies: Receipts for subscriptions to Microsoft Office and other office materials may be included in this category.


  • Rent: If you rent an office space or lease equipment for your business operation or if your business is based from a home you rent, those belong to this category.


  • Phone and internet expenses: Make sure you have the itemized statements you receive monthly for your internet access, home phone or fax, and mobile phone bills.


  • Travel expenses: You may want to discuss the requirements of a travel deduction with your accountant. But for categorization purposes, you may include airfare, baggage and shipping, car maintenance expenses, gas, mileage, tolls, parking, rental, cab fares, accommodations, and meals during travel.


  • Licenses and fees: File receipts for business licenses, professional license fees, trade association dues, and other fees you may incur in this category.


  • Educational expense: If you attend any seminars or professional development courses to learn more about how to run your business and improve your skills, you may include such expenses in this category. Again, you may want to discuss the criteria set out by the IRS on educational expenses with a tax professional before you claim it on your tax return.


  • Legal and professional fees: If you used a lawyer and an accountant to set up your limited liability company (LLC), include the receipts and invoices you’ve paid for their services in this category. This also covers bookkeeping fees and other professional consultant fees as long as they’re directly related to your business.(yes, you can work with us and write it all off on your taxes.)


Don’t Rely On Other Records

There’s a huge emphasis on receipts when it comes to taxes because it’s one of the few documents the CRA deems a viable supporting document. More specifically, these documents include sales slips, paid bills, invoices, store receipts, deposit slips, and canceled checks.  Note that bank statements and credit card statements are not allowed, so be sure to keep this in mind when debating whether to throw out a receipt.

Avoid Using Cash Whenever You Can

This is truly important. Cash is hard to track, easy to spend, and nearly impossible to reconcile with receipts. Use debit and credit cards; they provide you with monthly statements that can be easily married up with your receipts.

As more people choose to work for themselves, or continue o work remotely, CRA audits will continue to increase and the rules will be strictly enforced. The best course of action for small-business owners, freelancers and remote workers is to be prepare yourself with better set of books and receipts for all of your expenses. And consider working with a small business accountant, especially at tax time.