Episode description
Episode description
It you're actively avoiding your tax obligations, expect the spotlight of an auditor to shine brightly on your books
RNZ's money correspondent Susan Edmunds says IRD gets nearly seven thousand anonymous tip-offs a year about cash jobs, and the construction industry is the most often reported.
The tax department is warning businesses to get their houses in order - it's cracking down with the power of the millions it got in the budget.
The tax department got $29 million in the budget this year - $116m over four years - to collect tax from people who should be paying it, but aren't.
IRD has just released its list of targets and it's a broad one, spanning everyone from students, criminals, shop owners with electronic ways to cheat the system, sole traders whose books are a mess, cleaners, gardeners, landlords, and people who try to avoid banking systems by using cryptocurrency.
But top of its list is the construction industry, a sector long associated with the proliferation of the "cashie".
Today on The Detail we look at how Inland Revenue plans to pull in an estimated extra $702m using its new resources; and why the construction industry feels a bit hard done by when it comes to assumptions about how builders do business.
RNZ money correspondent Susan Edmunds says IRD gets nearly 7000 anonymous tip-offs a year about cash jobs, and the construction industry is the most often reported.
"There's been a focus for several years there and just amping that up a bit," she says.
Construction "has had a big downturn just lately, so probably from some businesses' perspective this isn't a great time for a crackdown. But they have been signalling for some time that it's coming".
The industry has been struggling with economic hard times, an increase in insolvencies, unavailability of materials and hugely increased costs, and Edmunds says IRD acknowledges that.
"But they say that some are just actively avoiding their obligations, and those are the ones that they're going for.
"IRD says it will use the money on tools and people to get its audits done, and accountants and tax experts say they expect to see a real step-up in activity, and everyone should be working to get their paperwork in order," she says. "They say they took a 'softly-softly' approach during the pandemic but that's now changed."
Auditors have started to do site visits looking for the missing millions, which Edmunds says might be alarming for some people. …