"Auckland's Best Lawyer for Taking on the Taxman"
Auckland’s Best Lawyers
Metro Magazine, August 2008, © ACPMagazines
You can tell fairly quickly if your builder, plumber or electrician is no good. Sooner or later it will become clear if you have an inept doctor. But how do you know if your lawyer has what it takes? Naming the bad ones would mean having to call in lawyers ourselves, so Jan Corbett set out to identify five of the best.
Drawing on observations from many cumulative years sitting on the press bench in this city’s courts, looking at lawyers’ track records and perhaps most importantly, asking their peers, Metro has identified Auckland’s top legal practitioners across the range of criminal, traffic, employment, tax and matrimonial law. They’re not cheap to hire – a top “silk” (Queen’s Counsel) can command $500 to $1,000 or more an hour. But of course your liberty and/or your peace of mind are at stake.
Tax may be his specialty but Geoff Clews isn’t the guy you go to if you want to exploit what few avenues we have in New Zealand to minimise it. He’s the guy you call after Inland Revenue bursts through your doors and seizes your computers, certain already after months of covert surveillance that you’re fiddling your taxes.
Clews’ role at that point is to ensure the IRD is acting lawfully and hasn’t exceeded its powers by, for instance, taking more material than it’s entitled to.
“They sometimes get that wrong in the heat of an inquiry. When adrenalin is up, mistakes get made.”
If it turns out you are indeed in breach of your tax obligations, Clews’ primary objective will be to dig you out of that hole faster than Inland Revenue can bury you in it, and at least try to minimise the penalty. Much of his work is done behind the scenes, trying to reach a settlement with the department.
Or he might show the IRD to be entirely wrong, as he did for the colourful Christchurch entrepreneur Dave Henderson, for whom Clews acted in the final stages of his battle with the IRD over a disputed $65,000 GST refund. Henderson, who was bankrupted by the IRD, heard about a previous case where Clews had been able to stop an IRD investigation. “He liked that, and came to see me.” He describes Henderson as “one of the most delightful clients I’ve had”.
Henderson later published a book about his battle, Be Very Afraid, which was subsequently turned into a film, We’re Here to Help.
Close followers of the Winebox inquiry in the mid- 1990s will remember Clews in the witness stand, accused at the time of exercising undue influence over the IRD, an “allegation” dismissed by the inquiry. Even though he was indeed a partner at the mega-firm Russell McVeagh, which was deeply involved in the Winebox transactions, Clews says he was one of the few tax lawyers who wasn’t involved in designing the Cook Islands schemes that were subsequently judged quite brilliant by inquiry commissioner Sir Ronald Davison.
He’s never even been to the Cook Islands, laughs the 51-year-old former head boy of Kelston Boys High School.
Ironically, at law school, tax was his worst subject. His grade was C minus. But where he found it dull academically, in practice it was comparatively exciting by the late 1980s. By then a whole industry had sprung up to exploit the loopholes in our tax regime — most of which have since been closed — and Russell McVeagh was leading the field thanks to the sharp minds of Dr Robin Congreve and Richard Green, who pioneered tax as a speciality in the firm.
As their understudy, Clews discovered tax touched almost every area of law and that he had to “understand people to understand what drove a transaction”.
Tax is also the point “at which most people have an immediate and continuing connection with the state”. When it comes to collecting tax, the state wields enor-mous power, and if people get into difficulty they “need effective representation to ensure the tax system doesn’t overwhelm them, as it so easily can”.
Clews has never found it boring.
People can, of course, fall foul of Inland Revenue unintentionally. He says, “There are as many good tax advisers as bad, as there are in any profession. You do see people who’ve done their best and taken advice they trust is good and relied on it, to their detriment.” The layperson doesn’t know what they don’t know, and there’s little scope for addressing that, although Inland Revenue has been known to take action against errant advisers.
If you get tax advice that sounds too good to be true, “it very probably will be”, Clews says. Realise before you act on it that tax disputes cost a whole lot more than what you might get from a supposed tax break.
One thing Clews does see is accountants who still don’t realise the importance of meeting the department’s deadlines when there’s a dispute. “If you don’t respond to their notices on time you can lose your right to resolve it.” If you have a tax problem, don’t ignore it, he says, because the rules are weighted in the state’s favour. The more you delay, the more it will cost you.
The fundamental thing about tax, of course, is that our attitude to it defines our position on the political spectrum — it’s the stuff of dinner-party debates. Clews reckons most New Zealanders accept, as he does, that taxation is the price you pay for a civilised society but believe the system has to operate fairly and robustly.
Thanks to the tax reform process of the past two decades, he says, we now have “a Rolls-Royce tax system for a Vauxhall Viva economy”.
He thinks it wise to realise “IRD officers are ordinary people doing a job in good faith”. Don’t expect them to understand your business — take the time to explain it to them. The hope is you can meet your commercial imperatives and your tax obligations. But “if you give them reason to distrust you, don’t be surprised that they do”.
For the full Metro article, click here