Why Storing Business Archives Offsite Makes Sense

Businesses of all sizes are required to keep a certain amount of paperwork to comply with regulations, which documents exactly need to be kept depends on the type of business but there is no getting away from the fact that you need to keep and store paperwork. At the very least the documents that would be required should your business be audited or come under some other sort of scrutiny. So the size of your businesses paper archives soon grows and eventually reaches the point where you need to think seriously about where and how you are going to store the files because it eventually becomes unworkable to simply have a filing cabinet or two or ten taking up valuable office space. This is when you might need to consider storing your business archives offsite in a specialist facility.

 

Of course, most businesses store a wide range of files digitally: invoices, strategy documents, technical  and functional specifications, financial spreadsheets, technical drawings and so on. Those digital files are also (hopefully) backed up somewhere – perhaps on a server at a different company location that can be used for a disaster recovery situation – and perhaps also in the cloud so they can be accessed from anywhere without the need for company computer hardware. And all of this is very reassuring – we can be reasonably confident that if we had a complete system failure or our premises burnt to the ground that the business could be up and running again relatively quickly at a new temporary location by accessing the vital documentation from our backup servers or from the cloud.

data-archiving-shows-library-catalog-and-backup

So when we consider physical paper document archiving that can seem dated, surely? Well no, there is still a long way to go before businesses can be entirely paperless. Just as one example, HMRC require paper records for a tax investigation should they decide to investigate your financial affairs, and as another example architects drawings are large scale and not easily transferred to a format that can be reproduced from a digital backup file. So the realities of storing physical documents are still very much with us in the business world.

Consequently, businesses can find that they are using a significant amount of expensive office space storing documents that they are legally obliged to keep but, in practise, rarely, if ever, have the need to retrieve. Clearly this is a waste of money paying for office space you don’t need just for your archives or having to rent additional office space for staff members when you actually have adequate space in your existing offices if it weren’t for the archive files.

It makes sense, then, to look at alternatives that save your business money and free up additional space but, at the same time, offer a risk free solution that both protects your valuable documents but also provides easy access to them should that be required. So storing your business archives off-site can make great business sense.

 

The Benefits of Offsite Document Archiving

 

Better Security

There are many reasons why storing your business archives on your own premises is not a good idea and one of these is the issue of security. Unless you have a secure room with controlled access there is always the potential that important documents can go missing, not necessarily deliberately, of course, but if members of staff have access to the files there could be a situation where a file is retrieved by mistake and not properly filed again. That file is then as good as lost and if it is, say, an important tax document then that is a potentially serious problem.

Even if you have excellent on-site security and a special storage room with controlled access to keep your archive files in, you can’t eliminate the possibility of files being removed; either deliberately of by mistake by one of your employees. Where your data records contain sensitive or confidential information this is a major risk.

However, with an off-site secure document archiving facility, you can have peace of mind that the employees at the facility are far less likely to breach security because they don’t know what files are contained in your archives; they don’t know the value of any potentially sensitive data. So because they are not familiar with your business there would be little to gain from deliberately removing or viewing files. And, in any case, the employees at secure document archiving facilities are rigorously vetted before being employed so your precious business archives will be safe and secure.

Freeing up Valuable Space

As businesses grow and expand so their quantity of paper documents grows and it starts to become obvious that they are taking up large amounts of office space that could be put to far better use. With office space being so expensive it makes sense that a simple way to free up that space is to place your businesses document archives in an alternative, off-site location. Freeing up valuable office space offers your company low cost options to expand the business by taking on additional employees without the cost and upheaval of moving offices.

Expandable Archive Space

Another element to take into account when considering whether to store your business archives offsite is that it is likely (if you choose your document archiving facility carefully) that you can easily rent additional space as and when you need it. Unlike business premises where you are unlikely to rent much more space than you need, because of the high cost, at an off-site storage facility there is usually plenty of extra space available. This extra space can be quickly rented as needed without any hassle as you will already have a contract with the facility. Consequently, if your business is expanding rapidly, but you are still required by law to retain your oldest records and files, but still accommodate new paperwork, you can simply rent a bigger storage space.

Of course, this would also work to your advantage in reverse. Of you find, say because of a change in legislation, that you need to retain fewer documents then you can just as easily reduce the amount of space you are renting and lower your overall costs.

Cost Effective Solution

Initially it may seem that the rental cost of using an off-site storage facility is simply an additional cost that you do not need to incur because you could just use space for which you are already paying rent i.e. your office space. But as you need to use more and more of that space as the business and the archives grow or when you may want to take on new employees to ease the workload you will find that you are restricted. And, in fact, when you do the calculations you will see that the cost of off-site storage rental is minimal compared with the cost of office space. And even more minimal if lack of space for new employees is holding back expansion of your business.

On balance off-site storage is a perfect cost-effective solution for businesses whose main premises comprise of office space. Even those types of businesses who have plentiful warehouse space can still find that it is cheaper to free up warehouse space for more stock and place business archives in less expensive storage.

There are also the hidden costs in time wasted if you are regularly having to re-organise your office space to make room for the growing mountain of files you are accumulating.

 

 

How to Prepare Your Documents for Off-Site Storage

 

inventory-files-indicates-paperwork-document-and-folderWe already know that with any business eventually comes a mountain of paperwork; even in this highly digital age there are certain documents that must be kept in paper form. That could be records of financial transactions for HMRC, legal case notes, old contracts or old customer records. And we now know that an off-site document archiving facility provides a cost-effective, safe and secure place to store your valuable information.

If your business has made the decision to use an external document archiving facility then full preparation of your documents is a must if you are to fully benefit from the services such facilities provide. After all there may come the day when you do have to retrieve that old paper document and you want to be able to find it quickly and easily.

Many businesses take the opportunity to digitally archive those documents that they can when their new external archiving system is first set up. This is, of course, an extra expense initially but as part of longer term planning it may mean you won’t need to expand your archiving space in a few years time. But digital archiving is also a long process so may not suit the needs of every business.

Whether you are planning to build a digital archive of old documents or not preparing your documents properly for archiving is essential to ensure you can find particular documents in the future should you need to.

So just how should you go about preparing documents for archiving off-site?

The First Stages

file-archive-means-catalog-document-and-documentationOrganising your existing files is the first vital stage – that might simply be checking that every file is in alphabetical or date order. It could also mean ensuring that each revision of, say, a technical specification document is stored together so that anyone needing to retrieve the latest version can be confident that is, indeed, what they have retrieved.

There is also the issue of how likely it will be that certain documents need to be retrieved. Within your business you may know that particular documents are highly unlikely to be ever needed and you are only keeping them to comply with current legislation. All of those types of documentation can be classified in a different way to the documents that are deemed quite likely to be required at some point in the future.

Understanding the regulations and legislation surrounding the need to keep the archives is important from the outset so that documents can be filed and stored in a way that is logical for your type of business. Once you have a firm understanding of this you will be able to categorise the documents broadly into long, medium and short-term access groups.

One of the reasons this is important is that off-site document storage will inevitably store boxes nearer the front or back of the storage space; or higher or lower in the area. (This is, of course, how the costs of off-site storage are kept low by utilising every inch of space from floor to ceiling, side to side and from front to back of the space.) So make sure you categorise accurately and that the short term documents are the most easily accessible.

Further Categorisations

Once you have divided your documents into short, medium and long term categorise you then need to think about how to further categorise them to make retrieval as easy as possible. One way to do this is to organise it into document types. So all customer records together, for example, and all financial transactions together. When these groupings have been decided  make sure that all documents are filed alphabetically, numerically or in date order.

Label Accurately

Once you have decided on all of the relevant and appropriate categories and sub-categories and organised the files suitably you need to ensure that everything is clearly labelled so that whoever needs to retrieve a particular document can find it as easily as possible. That means labelling individual files correctly and the archive boxes or cabinets that will contain the files, and then completing a detailed inventory of what each archive box or cabinet contains. This can be slow, tedious work but is absolutely essential so that documents can be easily found at a later date.

Selecting the Right Storage

You may opt to store rigid metal filing cabinets in your archive storage space but, more typically, the files are stored in boxes of some sort. Traditional archive boxes are made of rigid cardboard but another, more secure, option is hard plastic boxes. Plastic boxes are generally sturdier, more waterproof and resistant to rodents and other pests. The choice involves some additional costs but you also want to have peace of mind that your files cannot be subject to any damage during storage. Then, no matter how long the files are archived, they will suffer any unforeseen damage.

Selecting the Right Location

Once you have sorted, categorised, labelled and packed up all your archive files you need to find the right location for your document archiving. Any business clearly wants to balance a cost effective solution with being close enough to the business premises to make retrieval quick and easy. So a very cheap facility in the North of England won’t make sense if your business is located on the South Coast. However, if you are a London based business there are plenty of options for benefitting from lower storage costs by choosing a facility just outside the M25 but one that has good road connections with the capital. The Home Counties have plenty of good document archiving facilities at significantly lower costs that in Greater London. Just make sure the premises are easy to get to and have good security.

 

What Business Documents Need to be Archived?

 

EducationWe know the benefits of storing business archives offsite and we have looked at how to create an efficient and effective document archive by sorting, categorising and labelling documents in a systematic way but let’s look now in more detail about exactly which documents are most likely to be archived for a typical business.  Deciding just what you should keep in your business archives can be confusing with so many rules and regulations on what to keep and for how long so here are a few helpful pointers to make your business archiving simpler and easier to understand.

 

For all UK businesses trading here in the UK or overseas it is essential to keep certain documents relating to business transactions and accounting because it is a legal requirement with which every business must comply. HM Revenue and Customs (HMRC), the UK tax authorities, can ask to see these documents at any time and failure to produce them is very likely to lead to a full blown tax investigation by HMRC .

It’s understandable that this documentation can take up a lot of space and that many businesses choose to store these documents in an external document archiving facility. HMRC appreciate that this might be the case but would expect an efficient business archiving system to be in place from which you could fairly quickly retrieve those documents they need to look at. Knowing what documents you should keep is half the battle won. So here we look at what sort of documents you should keep in your business archives.

 

Company Tax Records

Every business is required to keep their company tax records for at least 6 years and many companies choose to keep them for even longer if they have the available space to store them. Given the timescales involved it is important to have an efficient archiving system and process to keep the archive up to date. Then you can be confident that you have all the appropriate documents if ever you need to prove to HMRC that the business has paid the right amount of tax.

Value Added Tax (VAT) Records

By law, VAT records should also be kept for a minimum of 6 years – again to make certain your company has all the necessary records available if they need to be reviewed.

Accounting

TaxesIn addition to all of your company’s VAT and Company Tax records for at least the last 6 years, you should also keep any other documents that relate to your filed company tax returns and any tax reliefs that you may have claimed, including those such as Research and Development (R&D) relief, Enterprise Management Incentives (EMI) and Venture Capital schemes. This will allow you to demonstrate the trail of business transactions, payments and reliefs claimed, and schemes entered into, accordingly.

Company Records and Personal Data

The UK’s Data Protection Laws must be complied with when it comes to storing personal information about both customers and your own employees. Every document that contains personal information such as names, addresses, emails, phone numbers or any other contact details should be placed in secure business archives and stored for up to 6 years.

 

PAYE Records

Pay As You Earn (PAYE) records for directors and employees (both permanent and temporary) should also be stored in your business archive to enable you to quickly and easily retrieve the information about the tax that has been paid under this scheme for any given individual associated with the company within the past 3 years. Note that this is not actually a legal requirement but it makes sense to retain these data because HMRC can request that you provide it to them so it is simply a matter of good business practice to keep it for at least 3 years.

Business Insurance

All UK based businesses are obliged to have an up to date Employers Liability Insurance Policy certificate and also possibly Public Liability Insurance and/or Professional Liability Insurance (depending on the actual type of business being run) So it is necessary to keep comprehensive records of all current and previous insurance policies that relate to the business and the business activities they have and are currently carrying out. This is to ensure that any future claims on their current or past liability insurance can be met in full.

Grants

Many businesses will, at some point, have benefitted from a range of government grants such as those available to start-up companies, and, therefore, it is necessary to securely retain records of all past and present documentation relating to any grants in your business archives. This information should be kept for at least 5 years after the grant monies were received – or the final payment if it was paid in instalments.

Loans

It is common for businesses when they first start up and during periods of expansion to take out a business loan so similarly you should keep all documentation relating to any loans for at least 5 years after the repayment of the loan.

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