Cash Deals Aren’t Tax-Free Income

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The government uses taxpayers’ money to pay for services we all need, such as healthcare, education, environmental protection and recreation.

While most people pay the right amount of tax, some people think they don’t have to pay tax if they’re paid in cash. By not declaring all their income, people who do un-taxed “cashies” are taking unfair advantage of honest businesses and cheating those who pay the right amount of tax.

If you’re not doing the right thing  Inland Revenue can help you get back on track.

If you’re not declaring your income

You can make a voluntary disclosure. There are incentives for letting Inland Revenue know you haven’t returned all your income before they find out, e.g. reduced penalties.

Complete a Voluntary disclosure (IR281) form

If you deal in cash

Keep good records of all your business transactions and provide your customers with receipts.

Make an effort to bank all cash you receive – don’t use it to make small purchases.

Encourage your customers to make a direct credit or internet banking payments rather than paying in cash.

Find out more about keeping records of income when running a business on Inland Revenue’s website.

If you have information about tax evasion and fraud

The entire community is impacted by businesses cheating on their taxes. You can play your part if you have concerns about those getting an unfair advantage.

Report this to Inland Revenue using their  IR873 Report tax evasion or fraud anonymously online service.

Please provide as much detail as possible when you fill in the form.

Source: www.business.govt.nz

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