IRD look at aggressive tax planning

Avoid aggressive tax planning

A small number of people try to avoid paying the tax they should or boost entitlements to social benefits by using inappropriate or unlawful tax structures. IRD call this – aggressive tax planning (ATP). Inland Revenue will investigate if they suspect your planning is not quite on the level.


What IRD are doing

IRD will match tax data from various sources to identify potential ATP structures and schemes. If they suspect ATP is happening, they’ll monitor the tax position taken and follow up with an investigation, where required. They’re working on projects to address specific ATP issues that they’ve identified. For example – herd scheme restructuring in the dairy farming industry and complex financing.

They’ve been very successful challenging tax avoidance in court over the past few years.

IRD also:

  • actively supports the international community’s work on Base Erosion and Profit Shifting (BEPS) in N.Z
  • provide education and support to professional bodies and other stakeholders (e.g. Accountants in Australia and New Zealand)


How you can get it right

Help yourself by learning more about aggressive tax planning so you can avoid it. If you’re considering an arrangement that minimises the tax you need to pay, get independent advice from a tax advisor. If you’re not sure about an arrangement consider asking IRD for a binding ruling so you can be certain to get your taxes right.