IRD is targeting property speculators and cash jobs in the construction sector

The Inland Revenue Department is putting more resources in catching property speculators and tradies who are avoiding paying tax.

IRD’s latest annual report says the department has been focusing on identifying property speculators, particularly in Auckland and Christchurch.

“This focus includes examining residential property sales and new developments to ensure that speculators are paying the correct amount of tax,” the report said.

In the year to June that work uncovered what the report described as “discrepancies” totaling $67.1 million.

“To help clarify the tax position, we delivered presentations to different industry groups on this topic,” the report said.

“We aim to educate people about how to deal with GST on a property and property investment.

“We will use funding from Budget 2015 to expand customer education and increase our focus in this sector.”

The department has also been targeting the hidden economy, where work is often undertaken for cash and the proceeds not declared to IRD.

The construction sector had been a particular focus for IRD in this area.

“In May and June 2015 we ran an advertising campaign to remind tradespeople to declare all of their income,” the report said.

“The campaign ran in four suburbs in Auckland and included billboards and posters at construction sites and advertisements online, on radio and in trade publications.

“The reaction was fast, with tax agents reporting a large number of calls from people looking to add cash jobs to the information they had submitted to us,” the report said.