Compliance and penalties
Complance and Penalty Rules
The compliance and penalties rules in the Tax Administration Act 1994 came into effect on 1 April 1997
The definition of "Tax Agent"
The amendment gives Inland Revenue a discretion to withhold recognition or remove a person as a tax agent when the action is necessary to protect the integrity of the tax system
Late filing penalty
The amendment specifies that when an employer monthly schedule is filed late a warning will be given, and that late filing penalties will be imposed on subsequent late filing
Late filing penalties for GST returns
A late filing penalty has been introduced for GST returns that are not filed by the due date
Late payment penalty notification
The amendment provides that Inland Revenue will notify a taxpayer the first time their payment is late rather than imposing an immediate late payment penalty
Associated persons
This amendment enables Inland Revenue to treat return periods that overlap as the same return period for associated persons, allowing a tax refund to be used to reduce an associated person's tax shortfall
Tax advisors and the shortfall penalty for not taking reasonable care
The legislation prescribes the circumstances in which a shortfall penalty for not taking reasonable care can be imposed when taxpayers have used a tax advisor
Refining the scope of the unacceptable tax position shortfall penalty
The amendments remove GST and withholding-type taxes from the scope of the unacceptable tax position shortfall penalty. The thresholds for the assessment of the unacceptable tax position shortfall penalty have been increased
Abusive tax position shortfall penalty threshold
The threshold for imposing the abusive tax position shortfall penalty has been repealed
Late payment of employer monthly schedule amounts
A new graduated penalty has been introduced that applies when an employer has filed an employer monthly schedule but not paid the associated tax and replaces the shortfall penalties that might apply in these circumstances
Tax compliance intiatives - limited amnesties
Inland Revenue has been given the ability to offer limited amnesties to specific industries where tax evasion is a significant concern
Due date for payment of tax
Section 142A of the Tax Administration Act 1994
Penalty reductions for voluntary disclosures
The shortfall penalty for not taking reasonable care, taking an unacceptable tax position or having an unacceptable interpretation will not be imposed when a tax shortfall is voluntarily disclosed before notification of a pending tax audit or investigation
Temporary shortfalls
The legislation has been clarified to reflect Inland Revenue's practice in relation to temporary tax shortfalls
Date published: 20 May 2008
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