How long does the IRS require you to keep receipts?

Three years in the standard case, matching the usual period of limitations on a return. It stretches to six years if you under-report income by more than 25%, seven for worthless-securities or bad-debt claims, at least four for employment tax records, and indefinitely if you never file or file fraudulently.

How long must UK sole traders keep their records?

At least five years after the 31 January Self Assessment deadline for that tax year. HMRC can charge a penalty of up to £3,000 for failing to keep adequate records, so it is a legal requirement rather than a suggestion.

Are photos or scans of receipts accepted for taxes?

Generally yes. Both the IRS and HMRC accept legible digital copies of most records, which also solves the problem of thermal paper fading long before the retention period ends. Some documents have special rules, so check the official guidance for your situation.

What if a receipt has faded and is unreadable?

A faded receipt is effectively no receipt, since it cannot back up the expense it belonged to. Thermal paper often fades within a year or two, which is the strongest argument for photographing receipts when you get them rather than storing paper.

Should I keep receipts if I am not self-employed?

Keep anything supporting a deduction, credit, or income item on your return for the same three-to-six-year horizon. Beyond tax, receipts for big purchases are worth keeping for warranties and returns, though a much shorter period usually covers that.

How Long Should You Keep Receipts for Taxes? A Freelancer's Guide

If you are self-employed, "how long do I keep this receipt?" is a real question with an official answer, and it is longer than most people think. Throw a receipt out too early and you have no proof if the tax authority ever asks. Here are the actual rules for the US and the UK, plus the painless way to store them.

United States: the IRS rule

The IRS keeps it relatively simple, with some important exceptions. The general rule is three years, tied to how long the agency has to question your return:

3 years in the standard case, the usual period of limitations on a return.
6 years if you under-report income by more than 25% of the gross income shown on your return.
7 years if you claim a loss from worthless securities or a bad-debt deduction.
At least 4 years for employment tax records.
Indefinitely if you do not file a return, or file a fraudulent one.

In short: keep everything for three years minimum, and longer if any of the special cases might apply to you.

United Kingdom: the HMRC rule

HMRC is stricter on time. If you are a sole trader or in a business partnership, you must keep your records for at least five years after the 31 January Self Assessment submission deadline for that tax year. Failing to keep adequate records can bring a penalty of up to £3,000, so this is not just a guideline.

A safe rule of thumb

If you do not want to memorise exceptions, keep every business receipt and tax record for at least six years. That comfortably covers the IRS three-year standard (and most of its exceptions) and the HMRC five-year rule, with margin to spare. Storage is cheap; a missing receipt during an audit is not.

The problem with paper

Thermal receipts fade, often within a year or two, which means a drawer of paper receipts can be unreadable long before the retention period is up. Faded paper is the same as no receipt. So "keeping" a receipt really means keeping a legible copy, and for most people that means going digital.

The easy way: capture once, keep forever

A digital copy solves both problems at once: it does not fade, and it is searchable when you actually need it. The simplest workflow is to photograph each receipt as you get it. With kvar. you snap a receipt and it is read and stored with the merchant, date, and total already captured, so your records are organised the moment the purchase happens, not reconstructed in a panic years later. For the day-to-day habit side of this, see how to track expenses from receipts.

Keep this in mind and the next tax season, or any surprise query, becomes a search instead of a scramble.

This is general information, not tax advice. Rules change and your situation may differ, so check the official guidance or a qualified accountant for your case.