Date: 7th January 2016
The IRD has made it clear that they will be targeting tax fraud, namely ‘cashies’, non-declared cash jobs, and businesses in the construction, trades, hospitality industries and other cash-based industries, will be in the spotlight for at least the next 12 months.
The IRD reports that a survey of Auckland tradespeople shows that their campaign highlighting cash jobs has hit home, with four in five believing they’ll get caught if they cheat on their taxes. The survey of nearly 420 tradies followed an advertising campaign in Auckland during April and May, with the message that tradespeople need to declare all their income, including cash, “or risk everything”.
Inland Revenue’s Group Manager Investigations and Advice, Patrick Goggin, said the survey results show that the message that doing under-the-table jobs is a tax crime is getting through. Mr Goggin said while the majority of tradespeople “do the right thing” by paying their taxes, there’s a minority who are cheating the system and ripping off taxpayers.
“Unfortunately our survey found that in the Auckland region, there’s anecdotal evidence that up to a quarter of building and construction involves under the table work. If that’s true, that’s a lot of tax not being paid and that would have funded vital services we all benefit from such as schools, hospitals and social services.
“I think what’s encouraging though is that tradies are talking about their tax obligations with their mates in the industry and with their customers. And most are saying it’s no longer okay to do work for cash and not declaring it.
If you want to stay on the right side of the law, try the following strategies in regards to declaring tax, suggested by Build Magazine:
Tax advisors have tools that can help with an IRD investigation. It’s often not the time for a DIY approach.
If you need help getting your tax records up to scratch, give us a call or send us an email.