What is audit activity?
Audit activity includes any audit, enquiry, investigation or review which is instigated by Inland Revenue (IR) and other government agencies to ensure business and tax payer compliance with various tax and legislative requirements such as Income Tax, PAYE, GST, FBT, Record Keeping and Employer Returns, amongst others.
How common is audit activity?
IR continues to focus on audit activity and is consistently provided with additional resources for this purpose. Now more than ever you are at risk of being selected for an audit, enquiry, investigation or review.
What is the Audit Shield Master Policy?
Our firm's Audit Shield Master Policy provides for the payment of professional fees incurred as a result of your lodged returns being selected for an audit, enquiry, investigation or review. The cost of being properly represented in these matters can be quite significant. Even if no adjustments are required, you could still be left with considerable professional fees if you are not protected by Audit Shield. Our Audit Shield Master Policy provides a fixed, cost effective solution to guard against these unbudgeted costs.
Who provides the Audit Shield Master Policy?
Audit Shield is provided by our accounting firm via a tax audit insurance Master Policy we hold in our business name, underwritten by Vero Liability Insurance Limited.
What lodged returns are covered?
- Computer Tax Audits
- Dividend Withholding Tax
- Employer Returns
- Fringe Benefits Tax
- Imputation Credit Account
- Income Tax
- Non-Resident Withholding Tax
- Record Keeping
- Resident Withholding Tax
- Plus more!
Who is covered?
All of our clients are invited to participate in our Audit Shield Master Policy. Different levels of cover are available for salary and wage earners and businesses with turnover under $100 million. In most cases individuals and other family entities can be covered with the business entities for no extra cost. If you decide to participate, your cover commences one business day after your payment is received.
Can a tax deduction be claimed?
Yes, a tax deduction should ordinarily be claimable for your payment if you are in business or self-employed.
What is not included?
We have carefully selected our Audit Shield Master Policy to provide the widest possible coverage for us and our clients. However, we do remind our clients that such items or circumstances as listed below are not covered:
Audit activity where notification was given prior to the inception of cover, i.e. prior to our receipt of your payment;
If IR auditor imposes final culpability/shortfall penalties of 100% or more, and/or the return is deemed to have been fraudulently lodged;
Actions in regard to any notices from IR or any government revenue authority that are educational or advisory in nature; or merely suggest, invite or propose actions to be taken by you; or act as a warning to you that you may be selected for audit activity at a future time; or do not compel you to take any action;
Any fine or penalties imposed or for any amounts payable pursuant to an amended notice of assessment or adjustment including but not limited to any additional tax, duty, government impost or similar payments;
Costs for work incurred which should have been undertaken prior to the audit activity (e.g. outstanding lodgements);
Any matter in relation to Inland Revenue Child Support, Working For Families, or any other government benefits or entitlements and any form of activity involving a review relevant to you maintaining industry status, licence compliance, membership or any form of application, registration, or re-registration process.
Is it mandatory to participate?
No, Audit Shield is an option our accounting firm provides to you, our client. You have the opportunity to participate in or decline the Audit Shield offer.
What do I need to do to participate?
Please contact one of our team members to obtain further information about our Audit Shield Master Policy and to learn how you can participate.
Please note that any official IR enquiries, investigations or reviews(for example a risk review) that subsequently continue, progress, expand, escalate or evolve into an official audit are always considered to be the one claim matter under the Audit Shield Master Policy that commenced on the date of first contact by IR.
Please contact us for further information regarding this insurance.