Can I delete previous years bank transactions so that only this years transactions are used?

Yes, you can, gbcdelta. I'll be happy to guide you to exclude last year's bank transactions in QuickBooks Online (QBO).

Excluding a transaction prevents the program from downloading that same entry into the bank feed again. If you delete it, rather than excluding it, the system will detect the transaction is not accounted for and will download it again from the bank. 

If you wish to exclude, please refer to the steps below.

1. Go to Transactions and click Bank Transactions.
2. Select the blue tile for the bank account.\
3. Go to the For Review tab and set the date in the dropdown. 
4. Put a checkmark on the transactions you want to exclude.
5. Click Exclude.

For further details, please refer to this guide: Exclude a bank transaction you downloaded into QuickBooks Online.

Additionally, you can see this article for the steps to reconcile your account: Reconcile an account in QuickBooks Online.

Keep in touch if you have other questions concerning your bank transactions in QBO. We're always here to help. Take care.