Income Tax – Wholesale Trader and Company to Pay Penalties of $169,194.60 and Fine of $5,000 for False PIC Claim


It was reported in IRAS’ website on 21 July 2017 that Chin Jin Han (“Chin“), who was running a wholesale trading company, Mah Sing Pte. Ltd (“Mah Sing”), has been convicted of providing false information in the company’s Productivity and Innovation Credit (“PIC”) cash payout application form.

Chin submitted a PIC cash payout application form to IRAS, under Mah Sing’s name, in Apr 2013. He obtained the signature of Mah Sing’s sole director, his mother-in-law who left the running of the business to him, and completed all the required fields in the PIC cash payout application form.

IRAS’ Investigations revealed that Mah Sing did not purchase the two servers and three workstations (“the equipment”) at the purported cost of $93,997, as declared in the PIC cash payout application form. The invoices that showed the purchase of the equipment were false.

Both Mah Sing and Chin were convicted of giving false information to the Comptroller of Income Tax, in order to obtain a PIC cash payout and Bonus which the company was not entitled to.

The court ordered the company to pay a penalty of $56,398.20 which is a one-time penalty of the amount of the PIC cash payout that was wrongfully claimed.

Chin was convicted of giving false information to the Comptroller of Income Tax to assist Mah Sing to obtain a PIC cash payout, which Mah Sing was not entitled to when no such purchase had in fact taken place. The court ordered Chin Jin Han to pay a penalty of $112,796.40, which is two times the amount of PIC cash payout that was wrongfully claimed, and a fine of $5,000.

What does this mean to you?

IRAS takes a serious view of any attempt by claimants, vendors or consultants to defraud the Government. Under the Income Tax Act, anyone convicted of an offence of abusing the PIC scheme will have to pay a penalty of up to four times the amount of PIC cash payout fraudulently obtained or which would have been obtained if the offence had not been detected, and a fine of up to $50,000 and/or imprisonment of up to five years.

If you have any questions, contact support@whm-consulting.com.

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