IRD recently reported a tax evasion case involving a South Auckland couple operating in the property renovation industry. The couple were sentenced by the court after failing to meet their tax obligations over an extended period, receiving business income through multiple bank accounts and providing false information to IRD, resulting in tax evasion involving more than NZ$500,000. On 5 October 2026, both individuals were sentenced at the Manukau District Court. One received n

When businesses leave outstanding tax debts unresolved for an extended period, the consequences may go beyond penalties and interest. As IRD tax debt continues to accumulate, Inland Revenue (IRD) may take further debt recovery action and, in appropriate circumstances, apply to the court to liquidate a company. Once matters reach this stage, the concern is no longer simply how much the company owes IRD, but whether the business can continue operating and what may happen to the

A Christchurch company director has recently been sentenced to two years and three months in prison after failing to pay nearly NZ$1.4 million in PAYE and GST over an extended period. What makes this case particularly concerning is not just the amount of unpaid tax, but the court's finding that the company was not entirely without funds. Instead, the director chose to use money that should have been paid to Inland Revenue (IRD) for other business expenses and personal purpose

Ysquared Chartered Accountants dealt with a complex IRD tax audit involving multiple companies and several family members in the construction industry. Over a number of years, errors had been made in the client's tax filings. Family members had also regularly withdrawn funds from the companies for personal purposes, including the construction of a private residence, without the associated tax obligations being correctly accounted for. How We Helped After receiving corresponde

A client recently approached Ysquared Chartered Accountants after receiving a letter from Inland Revenue regarding overseas income that had not been correctly declared in New Zealand. The matter also involved overseas investments and New Zealand’s Foreign Investment Fund (FIF) rules. The Situation IRD had identified overseas income that was not reflected correctly in the client’s previous New Zealand tax returns. The client also held overseas investments, which meant the FIF

Mortgage cashback payments are prevalent in New Zealand, particularly when borrowers refinance or transfer their loans to another bank. Many homeowners perceive cashback as merely a bank incentive without tax implications. However, the latest draft guidance from Inland Revenue, under PUB00504, suggests the matter may be more intricate, especially if the loan is associated with a rental property or another income-generating purpose. Is Mortgage Cashback Taxable When Received?

Getting ready for IRD tax audit is unlikely to be one of your favourite things to do as a business owner. But being prepared, organised and ready can take some of the pain out of an audit. Let's take a look at five key ways to be ready for an audit. Gather all the relevant documentation – this documentation will include financial statements, bank statements, expenses, management information and any other documentation that your auditor is likely to ask you for. Organise y

People who are buying and selling properties for profit are being warned they could get a tax bill, even if they hold the house for longer than two years - and even if they have lived in it themselves. The bright-line test has now been reduced to two years, which means that investors who hold a property for at least that long are not automatically handed a tax bill for any gains they make on the property. Inland Revenue recently released a tool that would help people to u

Selling up and exiting the business is a major chapter in your business journey. But if you’re going to get the maximum return on investment (ROI), it’s vital to have an exit plan and to think seriously about how you add value to the business in the run-up to selling. Forward planning prior to a sale is crucial. It’s generally accepted that a five-year exit plan is needed before you even think about putting the company on the market. Having this five-year plan gives you

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We get a lot of questions about what you can claim as a business expense, and clothing is one of the confusing topics when you’re self-employed. Most jobs have some sort of dress code – whether you wear suits and heels or overalls and steel-toed boots. Work clothes can be a significant expense for any business owner or employee. You only buy these clothes for your job, so it feels as though they should be business expenses, right? Well, not quite. What types of clothing can

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