Tax Record Keeping 2026: Essential Documentation Guide

Why Record Keeping Matters

Good tax records protect your deductions. LHDN requires proof. Without records, deductions are disallowed. Keep everything. Stay safe.

Essential Equipment Records

Purchase Records

• Invoice: Supplier invoice with date and amount
• Receipt: Payment confirmation
• Delivery note: Proof of delivery date
• Purchase order: Your order document

Financing Records

• Loan agreement: Complete financing contract
• Payment schedule: Installment breakdown
• Interest statements: Annual interest paid
• Payment receipts: All installment payments

Organizing Your Records

By Equipment

Create a file for each equipment:

• Folder name: Equipment type and ID
• Contents: All documents for that equipment
• Easy access: Quick reference when needed

By Year

Also organize by tax year:

• Folder name: Tax year
• Contents: All purchases and deductions that year
• Tax return ready: Easy filing and audit support

Bank vs. Ing Heng: Record Comparison

Record	Bank	Ing Heng Credit
Down Payment Proof	RM10,000-RM20,000 payment	0% - No payment needed
Loan Amount	90% of equipment cost	100% Full loan
Equipment Age	Under 5 years only	Any age allowed

Capital Allowance Records

Track capital allowance for each equipment:

• Year 1 initial allowance: 40% deduction
• Years 2-5 annual allowance: 20% of remaining
• Total deductions: Cumulative amount claimed
• Remaining value: Undeducted balance

Example: RM100,000 Excavator
• Year 1: RM40,000 initial allowance
• Year 2: RM12,000 annual allowance
• Year 3: RM9,600 annual allowance
• Year 4: RM7,680 annual allowance
• Year 5: RM6,144 annual allowance
• Total claimed: RM75,424

Interest Deduction Records

Keep interest records separately:

• Annual interest statement: From financier
• Interest breakdown: By payment period
• Total interest paid: Running total
• Deduction claimed: Amount deducted each year

Digital vs. Paper Records

Digital Records

• Easy to organize: Digital folders
• Quick search: Find documents fast
• Backup easily: Cloud storage
• Accessible anywhere: Remote access

Paper Records

• Original documents: Signed originals
• Hard copy backup: If digital fails
• Physical filing: Traditional system

Best Practice: Keep both digital and paper copies

Record Retention Period

• 7 years minimum: From tax filing date
• Longer if audited: Keep until audit complete
• Permanent records: Asset register, depreciation schedules

2026 Record Keeping Checklist

1. Create filing system: Digital and/or paper
2. File purchase documents: Immediately upon purchase
3. File loan documents: As received
4. Track payments: Record each installment
5. Update depreciation: Annual allowance calculations
6. File interest statements: As received annually
7. Maintain asset register: Current at all times
8. Backup everything: Secure storage

0% Down Payment Records

With 0% down payment:

• Simple records: No down payment to track
• Clear documentation: 0% down in loan agreement
• Full loan amount: Easy to calculate interest
• Same deductions: As cash purchase

Real Record Keeping Success

"Started business 2020. Poor record keeping. Tax audit 2024 was nightmare. Couldn't find documents. Deductions disallowed. Paid extra tax. Learned lesson. Now keep perfect records. Every file organized. Every document tracked. 2026 audit was smooth. Had everything ready. All deductions allowed. Good record keeping saves money and stress."

— Lim Siew Lin, Small Business Owner

Keep Perfect Records in 2026

Good records protect your tax deductions. 0% down payment simplifies tracking. 100% full loan properly documented. We provide complete paperwork.

We approve in 24-48 hours with full documentation. Start your 2026 equipment purchases with proper records today.