transaction records
Definition
Transaction records are the documented proof of every financial exchange that takes place in your business, including sales, purchases, payments, and refunds. Think of them as the paper trail that shows money or goods changing hands between you and another party. Courts, tax authorities, and auditors rely on these records to verify that business activity actually happened the way you claim it did.
Example
If a customer disputes a charge from six months ago, your transaction records showing the date, amount, and what they purchased can protect you from having to issue an unwarranted refund.
Watch Out
Most tax authorities require you to keep transaction records for at least three to seven years, so deleting old files or throwing away receipts too soon can create serious legal and tax problems.
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This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.