Penalties Linked to Tax Offences in New Zealand

Tax Management in New ZealandTaxes come in many forms; they come in salary deductions, a three dollar espresso, or even day-to-day grocery items. They are part of the bills that homeowners and entrepreneurs settle every month. Some people, however, choose to evade tax and their associated requirements.

A crime in New Zealand, below are the penalties linked to tax offences:

For Knowledge Offences

Breaching a tax obligation is one of the major and most common crimes in New Zealand. This offence includes the following: failure to provide required tax information, failure to deduct or withhold tax when required to do so, failure to account government for tax deducted or withheld, and providing altered or false tax information. According to Accounting North Ltd, those who commit knowledge offences are expected to pay $25,000 for the first offence and $50,000 and above for later offences. Imprisonment of up to five years may also be included.

For Absolute Liability Offences

Absolute liability offences consist of failure to provide information such as tax returns and forms, failure to issue a tax invoice within 28 days after the request, and failure to protect tax books and documents. Entrepreneurs are typically involved in this kind of offence. Penalties associated are $4,000 for the first offence, $8,000 for the second offence, and $12,000 for any following offence.

For General Evasion and Similar Offences

Tax evasion is a broad subject matter in New Zealand but for general purposes, tax evasion consists of the following actions: evasion of assessment or tax payment, obtaining a refund or payment when not lawfully entitled, and enabling someone not entitled to obtain a refund or payment. The penalty for cases like these is imprisonment of up to 5 years and a fine of up to $50,000.

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Everyone is required to settle taxes because apart from aiding the government, it also helps the community as a whole. Prevent penalties and imprisonment by filing your taxes and paying them on schedule.