It was reported in IRAS website on 25 October 2013 that Mr. Soh Kay Hee, a manager had unlawfully charged GST on approximately 1,100 sales invoices issued to the customers amounting to almost S$20,000. He is convicted and is liable to pay S$136,000 in penalties and fines (which is more than 6 times of the GST unlawfully collected). He defaulted the payment of the fines and penalties, and is now serving a total of 320 days of imprisonment.
Furthermore, IRAS compounded some of his offences for $81,000. This was twice the amount of GST unlawfully charged to his customers.
This case was uncovered through IRAS’ regular GST audit. More specifically, Soh listed his wife as the sole proprietor of the business. Neither of them is GST-registered person. IRAS’ investigation revealed that from 21 November 2002 to 11 June 2010, Soh issued sales invoices that reflected the prevailing rate of GST to his customers when he was not supposed to do so. He deposited the money into his business’ bank account and used it to pay for his business and family expenses, and also credit card bills.
What does this mean to you?
In short, it is an offence to charge GST if you are not registered for GST. Penalties can be up to three times of the amount of tax shown on the invoice and the person might be liable to a fine of up to $10,000.
If you have any questions regarding the above, please let us know.