When was the last time you used cash?

For lots of us, it's a bit of an anachronism. When you can tap your card, Stripe a credit card or use your smartphone to make a payment, hunting out the right number of coins and notes can seem pointlessly difficult.

But while everyone keeps predicting the death of cash, the amount we're using keeps growing.

There's about $6.5 billion of notes in circulation at the moment, which is getting near twice what it was ten years ago.


Theories for this increase vary but include things like people losing money or stashing it around their houses and forgetting about it, people using it for illegal purchases they'd rather no one knew about and the black market more generally.

Sometimes I see people who use cash to avoid paying tax. They might have a side gig that they don't want the hassle of admin for, or be doing cheap cashier jobs on the side of their regular work.

It's easy to see the appeal of this – the customer pays less than they might otherwise have to, but the person earning the money usually still makes more than they would if they were paying tax.

But it's not legal. In New Zealand, there's a tax obligation on every dollar of income earnt (except for in some cases of capital gains, but that's a story for another column).

The Inland Revenue Department is throwing more resources at tracking down black market transactions and some of the penalties it takes against people who are found to have been deliberately dodging their obligations are severe.

They tend to track people down through things like assets being purchased outside the business accounts, lifestyle expenses that it's not immediately obvious there is money to fund, and even things like social media comments.

With all the technology available these days, it's not hard to keep up with what you owe IRD. Don't risk getting caught out with cash.