Audit Shield
The Inland Revenue Department (IRD) can take an interest in the taxation affairs of any New Zealand taxpayer at any time.
Whether it’s Income Tax, GST or Payroll Returns, the IRD can initiate an enquiry even if the return was submitted correctly. Responding to IRD requests takes time and the resulting accounting fee cost can be significant.
Participation in our Audit Shield Master Policy will save you those costs. Whether it is a phone call, enquiry, review or audit, you are protected against additional fees when you choose to participate.
Benefits of the Audit Shield Master Policy:
Relief
If you are subject to an audit, enquiry, investigation or review in relation to your lodged returns, the professional fees associated with the response process (up to a prescribed limit) are covered.
Reputable provider
Offered through more than 600 New Zealand accounting firms, thousands of businesses, self-employed and salary/wage earners participate annually.
Retrospective protection
Previously lodged returns are covered automatically.
Simple claim process
In the event of a claim, we manage the process on your behalf.
Tax Deductible
The premium payment is tax deductible if you are in business or self-employed.
You have a choice
The offering is optional.
New Zealand taxpayers protected by the Audit Shield Master Policy saved close to $1 million in professional fees (based on participation) during the 2023/2024 financial year.
Important information about the Audit Shield Master Policy:
We hold the Audit Shield Master Policy nominally in our business name. If you participate in our Audit Shield Master Policy, we will include you and your entities in our policy.
The policy we hold is underwritten by certain underwriters at Lloyd’s. (Refer to *1 below for Lloyd’s Financial Strength Rating.)The premium payment is tax deductible if you are in business or self-employed.
We receive the premium payment from you as an agent of Accountancy Insurance, and your payment also includes a fee payable to us to cover our administrative costs for operating the
Audit Shield Master Policy (the fee we receive is calculated based on the estimated time spent administering this offering and varies depending on the size and complexity of your business).
You can benefit from the offering on the proviso that we are acting as your registered tax agent.
Participation in this offering is not automatic, and this webpage is not intended to be financial advice or a recommendation. Protection will commence on the next business day after we have received your premium payment, and expires on 31 August 2025.
FAQs
What is the Audit Shield Master Policy?
The Audit Shield Master Policy is a tax audit insurance policy that provides for the payment of our professional fees otherwise payable by you when incurred as a result of our accounting firm being required to respond, on your behalf, to an audit, enquiry, investigation or review (audit activity) of your lodged returns instigated by Inland Revenue.
What is the benefit of the Audit Shield Master Policy?
The fees which can be incurred for us to correctly respond to, and resolve an audit, enquiry, investigation or review of your lodged returns can be considerable. In fact, these fees can often be greater than those we charge you for completing your annual returns. Inland Revenue now has unprecedented access to data matching that makes it simpler and far more likely for previously untargeted taxpayers to encounter audit activity. There is no excess and no minimum claim amount.
What is included under the Audit Shield Master Policy?
Professional fees otherwise payable to us, that have been incurred in responding to audit activity until the completion of the matter, or until the cover limit as stated on your "Client Acceptance Form" is exhausted, will be covered under the Audit Shield Master Policy. Fees of any other external specialist (e.g. taxation lawyers) or relevant consultant engaged or instructed by us to assist us in a response to audit activity are also covered. Both during (interim payments) and/or upon conclusion of the audit activity, we will present for payment our fees on your behalf to the insurer for recovery against the policy. Should a difference arise between our fees and the amount available to be covered against the policy, we may need to seek the shortfall payment of our fees from you. Your cover begins from the next business day after our receipt of your premium payment (see the attached "Client Acceptance Form" for further details).
Is the cost tax deductible?
Yes. A tax deduction should ordinarily be claimable for your premium payment if you are in business or self-employed.
What is the benefit of the Audit Shield Master Policy?
The fees which can be incurred for us to correctly respond to, and resolve an audit, enquiry, investigation or review of your lodged returns can be considerable. In fact, these fees can often be greater than those we charge you for completing your annual returns. Inland Revenue now has unprecedented access to data matching that makes it simpler and far more likely for previously untargeted taxpayers to encounter audit activity. There is no excess and no minimum claim amount.
Will my professional fees be covered?
Yes. Costs (professional fees) which are directly related to the work we are required to undertake as a result of audit activity will ordinarily be covered (up to the limit specified on your "Client Acceptance Form"). The cost of these additional fees can be considerable depending on the amount of time required to attend to the audit activity. Standard fees associated with any typical compliance or other work conducted throughout the year are excluded.
Is it possible to arrange a pro rata premium for the Audit Shield Master Policy?
Yes, depending on your date of payment a pro rata premium may be available. Please speak with us to discuss the specifics of this option.
What audits, enquiries, investigations and reviews are covered?
Dividend Withholding Tax
Employer Returns
Fringe Benefits Tax
GST
Imputation Credit Account
Income Tax
Non-Resident Withholding Tax
PAYE
Recordkeeping
Resident Withholding Tax
What is not included?
We have carefully selected the Audit Shield Master Policy to provide the widest possible coverage for our clients. However, we do remind our clients that such items or circumstances as listed below are not covered:
Actions in regard to any notices from Inland Revenue 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 Inland Revenue audit that imposes final shortfall or culpability penalties of 100% or more, and/or the return is deemed to have been fraudulently lodged.
Any matter in relation to Inland Revenue Child Support, Working For Families, KiwiSaver, ACC or any other application, assessment or review of government benefits, entitlements, grants or subsidies and any form of activity involving a review relevant to you maintaining industry status, licence compliance, membership or any form of application, registration, or reregistration process.
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).
Audit activity where notification was given prior to the inception of cover, i.e. prior to our receipt of your premium payment.
Important information:
Please note that any official Inland Revenue enquiries, investigations or reviews (for example a risk review) that subsequently change or increase in scope or 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 made by Inland Revenue to either our clients or us.
