“..The IRD is turning its sights on the country’s top earners .. as the recession leaves a gaping hole in the government’s tax take.
This year, for the the first time, the tax department has sent questionnaires to some of the country’s biggest companies demanding details of the salary and perks of its three highest-earning staff.
Top executives in New Zealand earn as much as $7 million a year, attracting tax bills in the millions of dollars.
The questionnaire asks for details of all the perks and non-cash benefits of employment contracts.
The IRD focus on executive high-fliers comes hot on the heels of the department’s huge court victories against Westpac and Bank of New Zealand ..
.. which must now pay $918m and $645m to the IRD respectively in taxes and penalties.
The most common perks for top execs include cars, share options, bonuses, superannuation and sports club memberships.
But there are more gold-plated versions .. such as those in Telecom boss Paul Reynolds’ contract.
His package for the year to June 2009 was worth $7.1m, and included a base salary of $1.75m plus a $1.75m annual performance incentive.
Telecom is also paying for Scottish-born Reynolds and his family to travel business class between New Zealand and the UK for his first three years in the job (he took over in September 2007) .. and giving him accommodation costs of $100,000 for the first two years.
His salary package also includes $20,000 towards legal advice on his contract .. and $6000 for tax advice.
The spotlight on CEO pay is part of IRD’s new “compliance focus” document released in June ..
.. which spelt out where it will be placing greater scrutiny in the coming year..”
go to source/story>>Taxman to set sights on top bosses – national | Stuff.co.nz
