IR uncovers $150m undeclared tax
- Nairn Fisher
- 3 days ago
- 1 min read
Inland Revenue (IR) has uncovered over $153 million in undeclared GST and income tax from the property sector in just the first nine months of the current financial year — nearly matching the $156.8 million total for the entire previous year.
As part of its increased compliance work funded by extra money in last year’s budget, IR has been taking a closer look at the tax affairs of developers, people with rental properties, and those people covered by the Bright-line test.
Key Areas of Non-Compliance
1. Property Developers – $72.9M in discrepancies
Some developers claim big GST refunds early (for upfront costs), then fail to file/pay when the property sells.
IR is cracking down fast, especially when a sale isn’t reported as expected.
2. GST on Multiple Land Deals – $60M in discrepancies
IR is tracking frequent transfers, change of use, or entities swapping property — often used to dodge GST rules.
Automated analytics help detect red flags early.
3. Bright-line Test – $14.1M in discrepancies
A campaign launched in March is educating sellers about their tax obligations under the Bright-line rules.
So far, 550+ people have voluntarily disclosed their situation, with $3.68M in voluntary tax payments received.
IRD is watching the property sector closely. Whether you're a developer, investor, or someone selling a rental or home — it's crucial to stay on top of your tax obligations or risk enforcement.
Resources:
Property tax decision tool – helps you check if Bright-line tax applies.
