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30.7 Document Retention: 10-Year Requirement

Overview​

Luxembourg has strict document retention requirements for accounting and business records. Companies must retain documents for 10 years from the end of the fiscal year to which they relate. This requirement applies to all accounting records, supporting documents, and financial statements.

Accounting Law Requirements​

Article 8 of the Accounting Law requires companies to:

  • Keep accounting records for 10 years
  • Maintain supporting documents
  • Preserve financial statements
  • Retain audit reports (if applicable)

Commercial Code Requirements​

The Commercial Code also requires retention of:

  • Business correspondence
  • Commercial documents
  • Contracts and agreements
  • Other business records

Documents Subject to Retention​

Accounting Records​

Must Retain:

  • General ledger
  • Journal entries
  • Chart of accounts
  • Trial balances
  • Financial statements (annual accounts)
  • Supporting schedules

Supporting Documents​

Must Retain:

  • Invoices (sales and purchases)
  • Receipts
  • Bank statements
  • Contracts
  • Agreements
  • Correspondence related to accounting
  • Tax returns and supporting documents

Financial Statements​

Must Retain:

  • Annual accounts (balance sheet, income statement, notes)
  • Audit reports
  • Management reports
  • Interim financial statements
  • Previous versions (if amended)

Retention Period​

10-Year Rule​

Retention Period: 10 years from the end of the fiscal year to which documents relate.

Example:

  • Fiscal year ending 31 December 2024
  • Documents must be retained until 31 December 2034

Starting Point​

Retention starts from:

  • End of fiscal year (not date of document creation)
  • For annual accounts: End of fiscal year
  • For supporting documents: End of fiscal year to which they relate

Storage Requirements​

Physical Storage​

Physical Documents:

  • Must be stored securely
  • Must be protected from damage
  • Must be accessible when needed
  • Must be organized for easy retrieval

Electronic Storage​

Electronic Documents:

  • Must be stored in readable format
  • Must be backed up regularly
  • Must be protected from loss
  • Must be accessible when needed
  • Must maintain original format

Digital Preservation​

Best Practices:

  • Regular backups
  • Multiple storage locations
  • Format migration if needed
  • Access controls
  • Disaster recovery plans

Access and Retrieval​

Accessibility​

Documents Must Be:

  • Accessible when requested
  • Available for audits
  • Retrievable within reasonable time
  • In readable format
  • Properly organized

Retrieval Requirements​

When Requested:

  • Must be able to provide documents
  • Must be able to access historical records
  • Must be able to demonstrate compliance
  • Must be able to support audit requests

Compliance and Penalties​

Non-Compliance​

Failure to Retain Documents:

  • May result in penalties
  • May complicate audits
  • May create legal issues
  • May affect tax compliance

Penalties​

Potential Penalties:

  • Fines for non-compliance
  • Additional tax assessments if documents unavailable
  • Legal consequences
  • Business complications

Luxembourg Compliance Note​

Critical Requirements:

  • 10-year retention: All accounting documents must be retained for 10 years
  • Secure storage: Documents must be stored securely
  • Accessibility: Documents must be accessible when needed
  • Format preservation: Electronic documents must remain readable
  • Organization: Documents must be organized for retrieval

Best Practices:

  • Digital storage: Consider digital storage for efficiency
  • Backup systems: Implement regular backup procedures
  • Organization: Maintain organized filing system
  • Access controls: Implement proper access controls
  • Documentation: Document retention procedures

Common Issues:

  • Insufficient retention: Not retaining documents for full 10 years
  • Storage problems: Documents damaged or lost
  • Format issues: Electronic documents no longer readable
  • Organization problems: Unable to retrieve documents when needed
  • Backup failures: Electronic documents lost due to lack of backups

Think It Through​

Artisan Boulangerie has been operating for 8 years. They have documents from their first year of operations. Can they dispose of these documents? What should they consider before disposing of any documents?

Concepts in Practice​

Document Retention Example

TechLux Solutions document retention:

Fiscal Year: 31 December 2024

Documents Retained:

  • Accounting records (general ledger, journals)
  • Supporting documents (invoices, receipts, bank statements)
  • Annual accounts (balance sheet, income statement, notes)
  • Audit reports
  • Tax returns and supporting documents

Storage:

  • Electronic: All documents stored electronically with regular backups
  • Physical: Important original documents stored securely
  • Backup: Daily backups to cloud storage
  • Organization: Documents organized by fiscal year and type

Retention Schedule:

  • 2015 documents: Can be disposed (10 years from 31 December 2015 = 31 December 2025)
  • 2016-2024 documents: Must be retained
  • 2024 documents: Must be retained until 31 December 2034

Compliance: All documents properly retained, accessible, and organized.