Often clients have told us that they believe that the IRD's delays are deliberate so that more interest can be charged. We were sceptical, but this year we have seen a deterioration in IRD time frames and then we came across this information.
In the 2016/17 year, interest of $120 million was charged, and penalties of $72 million. Total ordinary and penalty interest for one year was $192 million, or $526,027 every single day. Every day that resolution is delayed, the IRD is potentially better off by more than $500,000. Naturally, this amount is spread over a large number of cases, and the longer the delay the greater the chance that the IRD receives zero because the borrower becomes bankrupt or dies, but these figures show that there is a huge benefit to the IRD in delay.