§235-108  Audit of return; procedure;additional taxes.  (a)  Audit.  The director of taxation or a responsibleperson designated by the director to act in the premises for the purpose ofverification or audit of a return made by the taxpayer or employer, or for thepurpose of making a return where none has been made, is authorized andempowered to examine all account books, bank books, bank statements, records,vouchers, copies of federal tax returns, and any and all other documents andevidences having any relevancy to the determination of the income or wages asrequired to be returned under this chapter, and the director may employ thedirector's powers under section 231-7 for such purposes.

(b)  Additional taxes.  If the department oftaxation discovers from the examination of the return or otherwise that income,or the liability of an employer in respect of wages, or any portion thereof,has not been assessed, it may assess the same and give notice to the taxpayeror employer of the assessment, and the taxpayer or employer shall thereuponhave an opportunity within thirty days to confer with the department as to theproposed assessment.  After the expiration of thirty days from suchnotification the department shall assess the income of the taxpayer, or theliability of the employer in respect of wages, or any portion thereof which itbelieves has not heretofore been assessed, and shall give notice to thetaxpayer or employer of the amount of the tax and interest and penalties ifany, and the amount thereof shall be paid within twenty days after the date thenotice was mailed, properly addressed to the taxpayer or employer at thetaxpayer's or employer's last known address or place of business. [L Sp 1957, c1, pt of §2; am L Sp 1959 2d, c 1, §16; Supp, §121-42; HRS §235-108; gen ch1985]

 

Case Notes

 

  Assessor not bound to take return as true.  16 H. 796.

  Method of computing depreciation not reflective of income. 18 H. 530.

  Reassessment proper when income in previous year unreported. 28 H. 261.