Not really. Unless your energy bills are to be treated as expenses which can be set against income, there is no need to keep them. What HMRC are interested in is taxing your income, and you should be able to account for all items of credit to your bank accounts if you want to say they are not income, and therefore not taxable.
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It may not be your income they are looking at directly, it might be some one elses that you have had dealings with. They have "unexplained" income, you have "unexplained" expenses, 2 and 2 make?
Even if HMRC could credibly allege that my friend's undeclared income
*is* my unexplained expense, that couldn't affect my tax position, only his.There is neither obligation nor need, from a tax point of view, to keep records of one's own domestic (i.e. non-business) expenses. Not ever.
Not doing so is not going to "make life difficult". Well, OK, not unless they were to decide, purely by reason of association, and without any real evidence to suspect me of tax evasion, to investigate me fully, but (a) I'm not sure that's lawful, and (b) being able to document irrelevant expenses isn't going to help then.
There is actually no limit, however for practical purposes it is 7yrs plus the current financial year.
Those records should include proof of an item being purchased if later sold, that way you can prove the sale was not income but actually a loss (or profit). This can catch out tradesmen who may struggle to account for say 50x =A3150 legitimate personal disposals over that period which otherwise appear to be =A35,000 undeclared income. However it can also catch out HMRC where the purchases were made online and thus easily proved.
Key, however is not relying on online records remaining intact, paper sadly is still very much the "in thing". Online records can however be very useful where paper receipts are "buried". I am reminded of Part P where a staff member at a dishonest supplier claimed that a CU had not been purchased in 2004 and bad mouthed the buyer around local tradesmen. In fact a long series of PayPal transactions showed that a spare CU and multiple RCBO CU had been purchased online at the same time. PayPal transactions stored on 3rd party servers are distinctly hard to fake and the supplier and his network of corrupt electricians were made to look a bunch of fools.
So electronic transactions can entrap or set free, HMRCs easy "you have income because you can not prove you purchased it" is fading fast for those wise enough to avoid "everything by cash". Similarly HMRC have a new tool to catch the real crooks where the accounts declare an income & expense sheet quite different to that obvious before them. That might yet catch out some of the charitable trust recruitment agencies.
On the contrary, that is exactly what is required in the UK.
Same reason you have to keep old cheque books, bank statements, receipts etc - and not just for self-assessment. Say you buy mostly online and sell things you do not want or have finished with on Ebay taking PayPal payment. If you log in to PayPal and just bring up 7yrs of "Payment Received" it may seen to be an "apparent Ebay income" of =A322,000. Since you shop online you most likely have receipts on your account, your paypal account or merchant account history (Ebuyer, RS, Amazon etc). So the problem is moot.
It is however quite possible and not uncommon for HMRC to ask you to justify that income, if only to waste your time as much as theirs. They assume people will have lost the paper receipt, fortunately online leaves a good "paper" trail which makes their past tricks more difficult.
One teacher I know of was investigated by HMRC because he partly blew the whistle on the IT teacher buying vast amounts of hardware using the school accounts cheap and selling it within the month, or outright using it for own business purposes offsite (=A39k Apple). The teacher who reported the budget abuse ended up slaughtering the HMRC by printing off everything off, dumping it on the floor of their offices and leaving them to it. Budget abuse in the public sector is widespread - a budget may allocate money for public-use sports equipment, in reality it gets delivered to a private club and used to set up a business which they profit from.
So do not assume HMRC will not ask for justification of personal activities where there is a clean trail of =A33-5k per year coming into an account over 7yrs from elsewhere. Personal disposals can appear on the surface (ie, without proof of purchase) to be a second undeclared income. That is I can assure you the automatic assumption of HMRC if they start digging.
In most cases HMRC is more interested in the bigger fish per dollar investigation, which is offshore bank accounts and offshore & onshore property portfolio income. The USA, Germany & UK have a serious "taxation black hole" which has grown from the 1990s to the extent that it is materially affecting government income and eventually government borrowing costs (although not as yet, because that they are all brown & smelly hides the smell). Part P was as much about electrician earning paper trail as membership fees and safety. Plumbers and Locksmiths however were the worst offenders re HMRC, IT contractors got screwed early on as many know :-)
You're wrong.
Anybody who does sell so much stuff on Ebay that it can look as though he's in business would, I agree, be well advised to keep records of expenses incurred in buying said stuff, to demonstrate that he is not making a profit.
The selling of used chattels is in any case not taxable (because it is usually assumed you would make a loss on them). If HMRC want to assess you as trading, the onus of proof is on them to show that you are trading as opposed to just selling unwanted junk. The onus is not on you to prove that you are not trading for profit. That's not to say that being investigated while they seek to find proof isn't going to be inconvenient.
But we were talking about energy bills. Unless they're business energy bills, they are of no use in dealings with HMRC at all.
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