Last chance to sort out that tax

Monday December 11, 2017 Written by Published in Local
Finance minister Mark Brown. 17121010 Finance minister Mark Brown. 17121010

If you still need to make outstanding tax payments and you haven’t taken advantage of the amnesty, your time is running out.

 

The team at the Tax Amnesty Office have been running their just “Come forward and talk to us” campaign since August, giving ample opportunity for people to sort out their tax issues.

Over 2000 reminder letters and many more emails were also sent to businesses and individuals earlier in the year outlining their obligations, but tax advisory officer Chiavanni Le’Mon says if you still haven’t got your tax sorted out, it’s not too late to do something about it.

The Tax Amnesty Office is located just along from the Post Office in Takuvaine Rd opposite the Ministry of Justice.

The office will only close on Christmas Day and Boxing Day, before the amnesty ends on December 31. Following the cut-off, the government will take action to recover any outstanding tax without the assistance provided by the amnesty.

In August, at the opening of the Tax Amnesty Office, Finance minister Mark Brown said: “We’ve got to do as much as we can to encourage people to come in and take advantage of this, to not sit back and wait for people to come.”

Brown said government had made a commitment to waive additional tax imposed on companies and individuals, but added they would still be obliged to pay any core tax owing to the IRD. Any penal tax imposed did not qualify to be written-off during the amnesty, and neither were any fines imposed by the High Court for tax offences. Brown said any person or company who had failed to declare income would be able to do this during the five-month amnesty without any fear of being prosecuted. The IRD confirmed companies registered as foreign enterprises would not be treated any differently to local businesses. However, under a tax information exchange agreement with several other countries, the IRD has been collecting information since January this year on Cook Islands entities that may hold funds in any offshore accounts, Brown added. And the Cook Islands will also make tax information available to other countries when the agreement comes into full effect January 1, 2018.

Brown warned that a 20 per cent penalty will be imposed on top of any undeclared income, as part of the tax department’s clampdown on earnings kept overseas and not declared here.

He said the amnesty was an “incentive for people to come in (to IRD) and settle their core taxes and focus on moving forward with their businesses, rather than being stuck in the position that a lot of them are in now.”

The IRD estimates around $17 million is owed in additional taxes and the five-month tax amnesty is expected to lose government around $2 million in tax revenues.

Brown also said during the announcement of the initiative in May that government didn’t expect to offer another tax amnesty. He added that the benefits of having taxpayers become more compliant would result in future economic growth.

“This will happen by making sure our people in the private sector, and individuals, are given the best opportunity to move forward from this current (non-compliant) situation that many of them are in now.”

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