In addition to the records/documents that must be kept by all Hong Kong businesses, if your business
deals in goods, you must maintain records relating to your purchases and
This includes full particulars of all goods purchased and all goods sold.
Copies of the invoices for the transactions must show goods, and the buyers
and sellers, in sufficient detail to enable the Commissioner to readily verify:
- The quantities and values of the goods.
- The identities of the sellers and buyers.
Most times, the relevant purchases and sales invoices issued for the
transactions will satisfy this requirement. If, however, the relevant details are
either absent from or not clear on an invoice, you should make additional
notations on it to clarify any doubtful points.
It may be practically difficulties in complying with this requirement if your
business is engaged in retail trade traditionally conducted in cash, particularly
as regards recording the identities of all purchasers. A concession therefore
exists for those taxpayers engaged in retail trades, professions and businesses
which are normally conducted in cash. They are not required to keep the
specified details records of all goods sold. If the concession applies to you,
you must nevertheless keep full records of your purchases and full details,
recorded on a day by day basis, of all sums of money received and expended
by your business.
The inclusion in your accounts of the correct value of trading stock on hand at
the end of the accounting year is essential in determining the correct profit for
that year. You must prepare and keep statements (including quantities and
values) of trading stock on hand at the end of the accounting year (together
with the stocktaking records from which the trading stock statements have