Section 17 – Search and Information-Gathering Powers of the Commissioner

The Commissioner of Inland Revenue has significant powers under Section 17 of the Tax Administration Act 1994. A recent Operational Statement sets out how the Commissioner will exercise these powers, including those under sections 17, 17C, and 17D, and references to the Search and Surveillance Act 2012. This statement replaces all previous operational statements.

1. General Powers Under Section 17

• The Commissioner may enter property and inspect documents or assets for the purpose of carrying out tax administration duties.

• These powers may be exercised by authorised Inland Revenue officers, who have delegated authority.

• Section 17 powers are frequently used during audits and investigations to obtain documents and information of interest to Inland Revenue.

2. Scope of Search

• The Commissioner can:

  • Access and inspect documents (including electronic records).

  • Make copies of documents.

  • Remove documents for examination.

• These powers are warrantless for any property other than a private dwelling.

• For private dwellings (including home offices), either:

  • The occupier’s consent, or

  • A warrant under section 17D is required.

3. Definition of Private Dwelling

Under section 17(5), a private dwelling includes:

• Any building or part of a building used as residential accommodation.

• Garages, sheds, or other structures connected with the dwelling.

• Business premises located within a private dwelling.

• Even a prison cell is considered a private dwelling.

This means Inland Revenue cannot access your home office without consent or a warrant.

4. Electronic and Remote Access

• Section 17 also allows the Commissioner to conduct remote access searches of electronic documents.

• This includes files stored on platforms such as Dropbox, Google Drive, or OneDrive.

• Inland Revenue may contact the electronic host directly to gain access to your records.

5. Use of Force

• Inland Revenue may use reasonable force, including locksmith services, to access locked premises, doors, or cabinets.

• Officers must, however, follow due process and respect legal privilege.

6. Legal Privilege and Non-Disclosure Rights

Protections include:

• Section 20 – legal professional privilege (e.g., communication with your lawyer cannot be disclosed).

• Sections 20B and 20G – non-disclosure rights for documents prepared by tax advisers.

• Privileges under the Search and Surveillance Act 2012 also apply.

7. Obligations During a Search

If Inland Revenue conducts a search:

• The occupier is not detained or arrested.

• The officer in charge must provide:

  • An explanation of the right to consult a lawyer.

  • Information about privilege against self-incrimination (section 60, Evidence Act).

  • A clear outline of the process being undertaken.

• Searches are expected to be carried out at a time that minimises disruption.

• A taxpayer’s lawyer or tax adviser may be present during the search, and this is recommended.

8. Section 17B – Requesting Information from Third Parties

• Section 17B empowers the Commissioner to require any person to provide information or produce documents relevant to tax administration.

• This power is often used in liquidation or bankruptcy cases.

• Inland Revenue can obtain information from:

  • Taxpayers themselves.

  • Third parties such as accountants, banks, employers, lawyers, and government agencies.

• Information collected is treated as confidential and secure.

• If information is not provided voluntarily, Inland Revenue may issue a formal notice under section 17B.

Summary

• Section 17 gives Inland Revenue broad warrantless search powers for all property except private dwellings.

• Private dwellings (including home offices) require either occupier consent or a warrant under section 17D.

• These powers extend to electronic records, including cloud-based storage.

• Taxpayers retain protections through legal privilege and non-disclosure rights.

• Section 17B allows Inland Revenue to demand information from taxpayers and third parties where required.