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Administrative penalties

Penalties are charged for errors or omissions in an entry.

About administrative penalties

An administrative penalty can be charged if there is an error or omission identified in an entry you have lodged with Customs. This could be an export, import, excise or export drawback entry.

The penalty is issued to the declarant, the person who makes the entry.  

Administrative penalties are intended to encourage you to provide correct information when making your entry, and to voluntarily tell us about any errors or omissions.

Errors with revenue implications

If an error on an entry results in a duty shortfall, the declarant will be charged an administrative penalty calculated as a percentage of the shortfall. They will also be charged compensatory interest.

The level of penalty depends on the cause of the error or omission resulting in duty shortfall:

If the cause is: then the penalty is calculated as
a % of the shortfall at...
up to a maximum of...
lack of reasonable care 20% $20,000
gross carelessness 40% $35,000
an error or omission was made knowingly 100% $50,000

In all cases the minimum penalty is $200.

Errors without revenue implications

If an entry error has no implication for revenue the penalty is $200.

Additional penalties

If you are charged an administrative penalty and it is unpaid after the due date, then an additional penalty can be applied (under section 289 of the Act). 

You can apply for remission of the additional penalty (section 290), and if refused you could then (section 292) either apply for an administrative review, or appeal the decision. See Review and appeals.   

Why entries must be accurate

An accurate entry is essential for:

  • prompt clearance of compliant goods
  • identification and assessment of risky goods 
  • collecting the correct revenue 
  • reporting official trade statistics 
  • providing assurance that New Zealand’s exports meet international obligations.

Further information

You can read Customs operational policy for administrative penalties.