Can Hong Kong Accounting Records Be Digital or Scanned?

Company law (s.376). Accounting records may be kept in hard copy or electronic form. If they are electronic, the company must be able to reproduce them in hard copy. Where records are not in a bound book, the company must take adequate precautions against falsification and make it possible to discover any falsification. Breaching these rules is an offence for the company and responsible persons (level 3 fine, up to HK$10,000).

Tax (IRD leaflet on electronic records). The IRD accepts electronic books of account and scanned source documents if:

• the information stays complete and unaltered after scanning;
• it can be displayed in a legible form;
• the records are kept in the original format, or in a format that accurately represents the original;
• details showing the origin, destination and date and time of the record are kept; and
• scanning and storage are done or supervised by a responsible person, particularly before originals are destroyed.

You do not need to apply to the IRD before going digital.

Practical tip: store scans in an access-controlled system with backups, and do not shred originals until you have checked the scans are complete and readable.