Record Retention Policy

Record retention policy is the dealership's guideline for how long and in what manner various business records must be kept, and when they can be disposed of. Dealerships handle a plethora of documents: sales contracts, lease agreements, finance paperwork, service repair orders, parts invoices, payroll records, etc. Many of these have legal retention requirements. For example, under provincial regulations like Ontario’s Motor Vehicle Dealers Act, a dealer must keep copies of all sale and lease transaction documents for at least 6 years [oai_citation:21‡omvic.examzify.com](https://omvic.examzify.com/question/how-long-does-the-mvda-3b960ca29549c523#:~:text=The%20Record,no%20less%20than%20six%20years). Tax records and payroll records federally might need longer (the CRA often expects at least 6-7 years for tax documents). Similarly, warranty and repair records may be needed for a number of years in case of disputes or recalls. The policy outlines not just duration but also storage methods – e.g., paper files stored on-site vs off-site archive vs digital scanning and backup – with an eye on security (especially for personal info per PIPEDA). The record retention policy also covers the proper disposal once the time is up – ensuring shredding of sensitive documents or certified destruction of digital records, so data doesn't leak. For a Canadian dealership, compliance with both provincial and federal laws is considered (like Quebec might have French language requirements for some records, or BC might have slightly different rules under their local acts). A well-defined policy ensures that in an audit or legal inquiry, the dealership can produce required documents, and that it isn’t holding on to unnecessary paperwork indefinitely (which reduces clutter and liability). It also educates employees on record-keeping responsibilities, for instance, an F&I manager knows they can't just toss old contracts until the policy says so. Ultimately, this process underpins accountability and legal compliance in all dealership operations, ensuring the right information is kept for the right length of time, then disposed of securely when no longer needed.