New Zealand Tax Agency Issues Decision Clarifying Shortfall Penalties for Undisclosed Income

The New Zealand Inland Revenue Nov. 24 issued Technical Decision Summary No. 23/14, clarifying taxpayer liability for evasion shortfall penalties on undisclosed income. The taxpayer was employed full-time and involved in their family’s business that included companies and trusts. The taxpayer received income from one of the business’s companies selling a leasehold interest to the local council, regular payments from the family trust, and some unexplained cash deposits. The Tax Agency reassessed the income received as undisclosed dividend income, beneficiary income, and income under ordinary concepts, and imposed an evasion shortfall penalty. The taxpayer disputed and proposed to adjust the ...