Record retention is the practice of keeping business records for as long as they may be required.
Why it is not a filing question
Records are needed for tax examination, for employment claims, for warranty and contract disputes, and for lien enforcement. Each has its own period, set by law rather than by preference, and the periods are longer than most owners assume.
A record discarded early cannot be recreated, and its absence is generally read against the business.
The categories that carry the longest obligations
Tax records and everything supporting them: returns, receipts, bank statements, asset purchase records. Records supporting an asset are usually needed for years after it is disposed of, not after it is bought.
Payroll and employment records, including time records, which employment law commonly requires be kept for a set period after employment ends.
Contracts, change orders and job files, for at least the period a claim can be brought over the work, which in construction is frequently measured in years after completion.
Formation and ownership documents, kept permanently.
The specific periods are set by federal, state and local law and by trade, and they change. This is a question for the business's accountant and attorney rather than a general list.
Form
Electronic copies are acceptable for most purposes provided they are complete, legible and retrievable. Retrievable is the part that fails: files kept on one person's laptop, or in an account nobody else can open, are not retained in any meaningful sense.
Backups held somewhere separate from the originals are what makes the retention real.
Disposal
Records containing personal information — payroll records, anything with identification numbers — carry disposal obligations of their own, and cannot simply be discarded.
Where they live
Employment records belong in employee documents, and tax records in tax documents.