The woman is not identified in the published version of a recent determination from the Taxation Review Authority. She is called simply “the Disputant” and her de facto partner is referred to as Mr X.
Together, Inland Revenue said they earned too much money for her to be entitled to the tax credits and she needed to pay them back.
Even if they weren’t a couple, the tax collectors said, the woman was still bringing in too much money to be entitled to all of the tax credits she claimed, because she had been stealing cash from her employer.
However, the woman argued, that did not establish a de facto relationship.
Authority member Grant Pearson noted that Mr X had given the woman’s address as his own to his employer, a car dealer, and - in fact - the Inland Revenue. He had told the tax department he lived there with his girlfriend.
ATM records showed that he was regularly in the neighbourhood, bank records showed that they often transferred money between their accounts and Mr X cited the woman’s income to help him apply for a loan.
He gave his employer and a finance company the woman’s name as his next of kin, and attended her work functions as her partner.
Pearson said that the evidence submitted that the two were not a couple was “wholly unconvincing”.
“I must conclude that the Disputant has fallen well short of establishing that she was not in a de facto relationship with Mr X and accordingly the assessments must stand,” Pearson said.
The woman countered that the stolen money shouldn’t count in her assessment, because it had gone to feed her gambling addiction.
But the upshot of the determination from authority member Pearson was that the Inland Revenue was right - the Disputant and Mr X were a couple, and she needed to repay $39,739.
Working for Families tax credits are paid to parents of dependent children aged 18 or under. The amount families are entitled to depends on the number of children and their income.
A family with two children will be entitled to some form of credit with income up to about $100,000 a year.
The woman claimed the credits on the basis that she was a single parent between 2015 and 2018, netting her between $9000 and nearly $11,000 for each of those years.
The Inland Revenue’s position was that she and Mr X, who was telling people that he lived at the same address as his girlfriend, was “in a relationship in the nature of a marriage or civil union”.
That being the case, his income should have been counted alongside hers when the tax credit entitlement was calculated.
The woman said that their families came from the same village in the Pacific.
They grew up near each other in New Zealand, had a family relationship and regarded each other as cousins.
She said the relationship “lacked an ongoing emotional commitment in the nature of marriage or a civil union”.
All the connections between them could be explained as “simple convenience, community and wider family connections”, she argued.
Mr X had a workshop at the Disputant’s home and may have occasionally slept in it. He used the Disputant’s home as a postal address and her as a next of kin.
Pearson also noted that the Inland Revenue would have had an alternative argument that the woman’s entitlement would have been impacted in three of the years, after she pleaded guilty to stealing money from her employer.
“The stolen funds were income for present purposes and allocated to periods by operation of law. There is no material discretion to change the effect of this income on the Disputant’s entitlement to [the tax credits].”
The determination says that the woman had lost the stolen money gambling and then had lost her job when discovered. She was convicted of theft and had to pay some of the stolen money back.
She will now have to pay back the tax credits as well.
Ric Stevens spent many years working for the former New Zealand Press Association news agency, including as a political reporter at Parliament, before holding senior positions at various daily newspapers. He joined NZME’s Open Justice team in 2022 and is based in Hawke’s Bay. His writing in the crime and justice sphere is informed by four years of frontline experience as a probation officer.
