IR to carry out surprise visits to nearly 300 New Zealand employers

The Inland Revenue Department (IR) is carrying out unannounced visits to businesses that are reportedly not meeting their tax obligations following thousands of anonymous tip-offs.

According to the department, it will be visiting nearly 300 employers across various sectors in New Zealand.

"We want the businesses we are visiting to understand their obligations and we'll help them put their affairs right. But we'll also act on any further non-compliance, with consequences for them," the IR said in a media release.

"This is not an audit or an in-depth review, but it is a chance for businesses to explain what they're doing and get some help in getting it right."

The visits are part of the government's Get it Right campaign, which recognises that while more businesses do the right thing, there are others that don't.

"We are aware of and actively seeking out and prosecuting those who aren't paying their fair share," the IR said.

The visits are also another round in the IR's Hidden Economy suite of work and builds on the success of the department's liquor store campaign in the past year.

Tip-offs on non-compliance

The IR said it identified the businesses to be visited after going through thousands of anonymous tip-offs from the public.

"Inland Revenue's [staff] has analysed the anonymous information at a high level. That's shown the tax risks overwhelmingly relate to taking the cash for personal use without recording sales and/or paying employees in cash," the IR said.

According to the IR, nearly 7,000 anonymous tip-offs reach their department every year, noting that the volume has also been growing over the past years.

It indicates "an increased sense of frustration by the community in general with businesses who are not doing the right thing," according to the IR.

Ahead of the visits, the IR reminded employers to keep a record and declare all income and sales, including any cash sales.

"It's fine to receive cash payments, so long as those are recorded and reported as income earned in GST and income tax returns," it said.