Can you claim business expenses without receipts in New Zealand?

Sometimes, but the burden of proof is on you. A genuine business expense does not stop being deductible because the receipt went through the wash. What changes is how you show it happened, and whether you can show it at all if Inland Revenue asks.

The Tax Administration Act puts that on the taxpayer. Under section 149A, the onus of proof in civil proceedings about your tax "rests with the taxpayer". If an expense is questioned and you cannot support it, expect it to be disallowed.

What can stand in for a lost receipt#

Inland Revenue's own list of records covers more than receipts: invoices, bank statements, credit card statements and vouchers, point-of-sale records and cashbooks. When the receipt is gone, rebuild the evidence from what is left:

• A bank or card statement. It proves you paid, when and whom. It rarely shows what you bought, so add a note saying what it was and why it was for the business.
• The supplier's copy. Most businesses can reissue an invoice or receipt. For a purchase over $200, a GST-registered supplier has to give you taxable supply information within 28 days of a request.
• Order confirmations and emails. Online orders leave a trail with the items, price and date.
• Your own record, made at the time. A note in your cashbook or diary of what you bought and why, written when it happened, carries far more weight than one written the week your return is due.

The weakest position is an expense with only your say-so behind it, claimed in the same pattern year after year.

GST claims need more than income tax claims#

For income tax, the question is whether you incurred the expense for your business. For GST, you also need the right paperwork before you claim.

• Over $200: the taxable supply information must show the supplier's GST number and the GST, or a statement that the price includes it. A bank statement line does not have either, so ask the supplier for a copy before you claim.
• $200 or less: the supplier's name, the date, a description and the amount. A clear record of the purchase is usually enough.

See GST receipt rules in New Zealand for the full table, including what changes above $1,000.

When records are lost, destroyed or damaged#

Floods, fires and failed hard drives happen. Inland Revenue's guidance is practical:

1. Contact it early if the loss will make you late filing or paying. It may be able to give you more time.
2. Try to recover copies. Ask your accountant, your suppliers and your customers. Your myIR account holds your returns and account history, and records on a damaged device may be recoverable.
3. Explain what happened and what you tried, and give alternative information where you can.

Inland Revenue says it will not penalise you for incomplete or missing records if you have made a reasonable attempt to reconstruct them in a reasonable timeframe.

The habit that avoids all of this#

Records are easiest to keep on the day you spend the money. Photograph the receipt, or forward the emailed one, before it leaves the shop counter or the inbox. Inland Revenue accepts electronic copies, and you can throw the paper away once you have one, as long as a copy of your records is kept in New Zealand.