Accounting Records a Hong Kong Company Must Keep: What, Where and for How Long
Every Hong Kong company has to keep proper accounting records, and two laws say so: the Companies Ordinance, for the company's own accounts, and the Inland Revenue Ordinance, for tax. The duties overlap, but they're not identical. Here's what both require.
What the Companies Ordinance requires
Under section 373 of the Companies Ordinance, a company's accounting records must be sufficient to:
- show and explain the company's transactions;
- disclose with reasonable accuracy, at any time, its financial position and financial performance; and
- enable the directors to make sure the financial statements comply with the Ordinance.
In particular, they must contain daily entries of all money received and spent, with what each receipt or payment was for, and a record of the company's assets and liabilities.
"At any time" matters: records written up once a year from a box of receipts don't meet it (see the month-end close).
What the Inland Revenue Ordinance requires
Section 51C of the Inland Revenue Ordinance requires every business to keep sufficient records of its income and expenditure, in English or Chinese, so that its assessable profits can be readily worked out. The records include books of account and the documents that verify them: "vouchers, bank statements, invoices, receipts", plus records of goods bought and sold, stock, and services provided (IRD guidance).
| Record | Examples | Keep for |
|---|---|---|
| Books of account | Ledgers, journals, the trial balance, the accounting system's data | 7 years |
| Money in and out | Bank statements, payment records, receipts | 7 years |
| Documents behind entries | Sales and purchase invoices, receipts, contracts, payroll records | 7 years |
| Assets and liabilities | Fixed asset register, loan agreements, leases | 7 years |
| Goods | Purchases and sales of goods with buyers and sellers, stocktake sheets | 7 years |
| Services | Records of services provided, in enough detail to check the entries | 7 years |
How long: seven years, but from when?
- Companies Ordinance (section 377): 7 years after the end of the financial year to which the last entry in the records relates.
- Inland Revenue Ordinance (section 51C): at least 7 years after the transactions they relate to are completed.
In practice, keep each year's records for 7 years after that financial year ends, and longer for anything still open, such as a long contract, an asset still in use or a loss still being carried forward (see tax losses).
Where they can be kept
- At the registered office or anywhere else the directors think fit, open to the directors at all times (section 374). Directors can take copies free of charge (section 375).
- Outside Hong Kong is allowed, but then accounts and returns showing the financial position with reasonable accuracy, at intervals of not more than 6 months, must be sent to and kept at a place in Hong Kong.
- Electronically: records can be kept on a computer or in an accounting system, as long as they can be inspected and reproduced in hard copy.
The penalties
- Directors who fail to take all reasonable steps to ensure the records are kept face a fine of HK$300,000, and if the failure is wilful, up to 12 months' imprisonment as well (section 373). A director has a defence if they reasonably believed a competent and reliable person was responsible for keeping them.
- Under the tax law, failing to keep records without reasonable excuse can lead to a fine of up to HK$100,000 (section 80(1A); IRD).
How Certanta helps
- Daily entries from bank feeds or statements, each with what it was for.
- The source document linked behind every line, uploaded from a phone in any language, with the books themselves kept in English.
- Every year's records in one place, ready for your auditor and the IRD.
Frequently asked questions
What accounting records must a Hong Kong company keep?
Records sufficient to show and explain its transactions and disclose its financial position with reasonable accuracy at any time, including daily entries of all money received and spent and a record of assets and liabilities (Companies Ordinance s.373), plus the documents that verify them, such as vouchers, bank statements, invoices and receipts (Inland Revenue Ordinance s.51C).
How long must a Hong Kong company keep its records?
Seven years. The Companies Ordinance counts from the end of the financial year to which the last entry relates (s.377); the Inland Revenue Ordinance counts from the completion of the transactions (s.51C).
Can accounting records be kept outside Hong Kong?
Yes, but accounts and returns that disclose the financial position with reasonable accuracy, at intervals of not more than six months, must be sent to and kept at a place in Hong Kong (Companies Ordinance s.374).
In what language must records be kept?
The Inland Revenue Ordinance requires records in English or Chinese (s.51C).
Can records be kept electronically?
Yes. Books of account kept by computer are records under the Inland Revenue Ordinance, and the Companies Ordinance requires electronic records to be open to inspection and reproducible in hard copy.
What is the penalty for not keeping proper records?
A director who fails to take all reasonable steps faces a fine of HK$300,000, and imprisonment for up to 12 months if wilful (Companies Ordinance s.373). Under the Inland Revenue Ordinance the maximum fine is HK$100,000.
Records kept, and kept together
Certanta keeps your ledger with the source document linked behind every line, so the records the law asks for are complete and in one place.
Open the demo See pricingThis article summarises sections 373 to 377 of the Companies Ordinance (Cap. 622) and sections 51C and 80 of the Inland Revenue Ordinance (Cap. 112) as published on e-Legislation, and the IRD's record-keeping guidance, as at 29 October 2026. It is general information, not legal or tax advice.