Inland Revenue (IR) New Zealand: Compliance Tip-offs

Within the tax system, a sense of fairness and equity is crucial for fostering compliance. Compliance tip-offs are one way Inland Revenue (IR) helps create the all-important ‘level playing field’ and support the work to help New Zealand taxpayers get things right.

In the 12 months to December 2024 our Intelligence Team received more than 7000 tip-offs providing valuable information that we wouldn’t usually get in any other way. The Intelligence Team reads and categorises every tip-off received, using this information to identify compliance-related patterns and trends, system-level vulnerabilities, and specific individuals or entities that present a risk to the tax and social policy system.

A great example of the impact of tip-offs on our compliance priorities was action that came from a trend in tip-offs about tax advisors. Consequently, we have been able to identify attributes that indicate an advisor might need to be looked at more closely.

From analysis of tip-offs, the Intelligence Team identified 300 businesses that our Community Compliance people then visited during December and January to help get their tax affairs right, with great results. An unannounced visit by IR can be an effective alternative to an audit – they can validate information, open up conversations about obligations, and influence taxpayer behaviours and attitudes and, ultimately, future compliance. Tip-offs also inform our Hidden Economy work. This includes the Getting It Right work programme, our series of short rolling campaigns that started early in 2024.

Among the valuable insights from the Intelligence Team’s analysis of tip-offs are behavioural insights we gain when interacting with taxpayers. These insights are highlighted in the Quarterly Risk Radar, an internal analysis which summarises the total number of tip-offs received, the top industries to which they relate, where referrals have been made within IR, as well as emerging themes and patterns.