Over the last few years there have been changes in the way the Inland Revenue conducts its audits. In the past, businesses could have expected to be audited every three to five years, however in recent times the Inland Revenue have been undertaking more and more “risk based” reviews on both business and individuals. This is as a result of a Government cash injection to investigate tax evasion, with a focus on specific higher risk areas such as property speculation, trade and construction where cash transactions may not be reported.
These risk based reviews are done with a broader view than an audit and may start with a compliance package information request. Provided you supply the correct information in a timely manner and everything is in order, no further action may be required. Sometimes, however, these risk based reviews can be expanded to full audits.
For either a review or an audit, an Accountant will need to be brought in to help which can be a lengthy and very expensive process, in some cases costing up to $20,000 depending on the size of your business.
To help manage the risk of these common reviews, K3 Accounting is now offering ‘Audit Shield’ to all of its clients. The Audit Shield Policy provides for the payment of professional fees incurred in the event that you are selected for an audit, enquiry, investigation or review instigated by Inland Revenue.
What does Audit Shield cover?
All professional fees up to a prescribed limited (with no excess) are covered when you engage us in audit activity matters. Our fees in addition to legal fees, bookkeeping fees and other specialist professional advisor fees required to assist us in our responses are covered, and services include Income Tax, Risk Reviews, GST, PAYE, Fringe Benefit Tax, Resident Withholding Tax and more. Audit Shield is retrospective, so all previously lodged returns are also covered.
Is Audit Shield right for you?
Any businesses or individual can be a target, even if their lodgements are accurate. For those in business or self employed, a tax deduction should ordinarily be claimable for your payment.
For more information on Audit Shield or any of K3 Accounting's other services, contact Richard Matson on 021 635 576.