Updates on compliance
Read about about our progress against Our Compliance Focus 2010-11 including hidden economy, debt and property.
Results and successes
Over the last year tax agents have asked about our progress against Our Compliance Focus 2010-11.
Tax agents were particularly interested in the areas that received additional funding from the government: hidden economy, debt and property.
You can read about our progress in these and other areas on this page and link to relevant in-depth information. During the 2011-12 year we will also be updating our Compliance News pages with further results.
Hidden Economy
In the May 2010 budget we were given additional funding to detect and take action against those who choose to operate in the hidden economy. By the end of April we had brought in a total of $118.5 million in revenue, exceeding the return on investment target for the 2010-11 year.
In the cafes and restaurant sector alone, we completed 650 compliance visits and are conducting over 100 investigations.
We have received a number of voluntary disclosures, including one from within the hospitality industry for $2.2 million.
Over the last five years PAYE payments from the horticultural industry have almost doubled, from $88 million to $150 million, while the size of the industry has remained relatively unchanged. The increase is a direct result of our advisory and audit activity and the tightening of rules around schedular payments.
Read more about exposing hidden economy
Debt
We successfully piloted a major texting campaign aimed at customers with tax to pay due on 7 February. For example, half of those who received a reminder text, and regularly don’t meet their obligations, paid on time this year.
We’ve seen positive results from our initiative in Australia to encourage defaulting student loan borrowers to make repayments. More than $2 million in student loan debt has been repaid since the campaign began in October 2010.
Read more about encouraging customers to manage their debt
Income from Property
We’ve been working to improve our customers understanding of their tax obligations when buying or selling property. We developed a Tax and your property transactions (IR361) brochure to clarify what’s involved in property ownership and cover areas where mistakes commonly occur.
Read more about residential property
Losses
We ran a campaign for customers who were identified with a mismatch between their losses to carry forward and their loss brought forward balance. We sent customers with a mismatch in the 2008 income year a letter outlining the mismatch and inviting a voluntary disclosure. A 100-case pilot resulted in 90% of customers making voluntary disclosures. As a result $3.4 million of losses were adjusted. We’ve extended this pilot.
We identified 1,700 tax agents with clients who had losses from previous years. Before agents lodged returns on behalf their clients, we sent them a letter to let them know of common errors we’ve seen in calculating losses and how to get it right when preparing returns.
Read more about how to help your clients get their losses right
Anonymous information
We developed a new process for receiving and processing anonymous information from customers. As part of that we launched a new online form and phone number that allows you to notify Inland Revenue if you suspect an individual or business of evading the tax system or committing fraud.
The information you provide remains anonymous and lets us coordinate an appropriate response.
Report tax evasion or fraud anonymously
Date published: 22 Jul 2011
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