On other fediverse servers you have a local and federated timeline, and when I first started on the project I began implementing that. But because it was beginning to get complex I was wondering whether these timelines are strictly required.

As far as I can tell from the ActivityPub specification the local and federated timelines aren't part of the spec. Instead you only have inbox and outbox, like email. It turns out that those timelines are just a convention carried over from StatusNet/identica originally.

Not implementing those timelines seems like an improvement. There is perhaps some loss of discoverability, but there's a much bigger gain in control over what ends up on your timeline and what gets written to disk storage. If you're concerned about the potential for illegal content which you havn't signed up for to get onto your server then doing it the inbox/outbox way gives a lot more confidence that you're remaining inside of the legal boundaries.