Tag Archives: Income Tax

Income Tax – Country-by-Country Reporting (Third Edition)


The IRAS has issued the third edition of the Country-by-Country Reporting e-Tax Guide on 7 August 2018 by amending the answer to Question 11 of the FAQ.

Question 11: Can rounded figures be reported in the CbC report?

Companies can report rounded figures in their CbC report if the source data from which those amounts have been obtained consist of rounded figures.

Companies should ensure that the rounding does not have a material impact in terms of understanding the CbC report.

When rounding off to the nearest thousand, companies would still have to show the figures in full. For example, if the rounded figure is S$1,126,000, it should be entered in the CbC report as S$1,126,000 and not S$1,126.

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Income Tax – Sole proprietor convicted for PIC sham


It was reported in IRAS’ website on 3 August 2018 that Lim
Mei Lee, who is a sole proprietor of Wahla Balloon, has been convicted and sentenced for abusing the Productivity and Innovation Credit (“PIC“) scheme by giving false information to illegally obtain PIC cash payouts and bonuses for Wahla Balloon.

Investigations by IRAS revealed that Lim gave false information to the Comptroller of Income Tax (“CIT“) by stating in Wahla Balloon’s PIC application forms that the business had incurred qualifying PIC expenditure when no such expenditure had been incurred.

The forms were submitted between November 2013 to July 2014 to claim $11,953.80 in PIC cash payouts and $13,269 in PIC bonuses for the purported expenditure of $19,923 to purchase items such as balloon inflators and to attend balloon making workshops.

Lim thus committed an offense by giving false information to illegally obtain PIC cash payouts and bonuses that she was not entitled to.

Lim faced a total of 8 charges of giving false information to the CIT to illegally obtain PIC cash payouts and bonuses. She pleaded guilty to 3 proceeded charges, involving a total amount of PIC cash payouts and bonuses of $13,204.60, with the other 5 remaining charges being taken into consideration for the purposes of sentencing. The Court ordered Lim to pay a fine of $9,000 and a penalty of $26,409.20, 2X the amount of cash payouts and bonuses illegally obtained, and sentenced her to 23 weeks’ imprisonment in default of payment.

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Singapore GST – Former professional engineer penalised for evading taxes and failing to register for GST


It was reported on IRAS’ website on 4 June 2018 that a former professional electrical engineer, Ng Hai Hock, who owned a sole proprietorship, NHH Consultants, was sentenced to 6 weeks’ imprisonment and ordered to pay fines and penalties totaling $180,105.37 after being found guilty of evading income taxes as well as failing to register for GST. In addition, Ng is required to pay a total of $533,504.25 in back-dated taxes to IRAS.

IRAS’ Investigations revealed that in 2007, Ng was liable to notify the Comptroller of GST of his liability to register for GST by 30 Jan 2008.  However, he failed to do so by the due date, thus failing to account for GST on taxable supplies provided by NHH Consultants.

Further investigations revealed that Ng had wilfully evaded taxes by omitting to declare the income earned by him from NHH Consultants in his income tax returns for YAs 2008, 2009, 2010 and 2012.

Ng had also failed to file his income tax returns for YA 2011 despite the fact that he was issued a No-Filing Service (NFS) letter by IRAS. This is because he had earned income in YA 2011 beyond what was auto-included and thus did not meet the conditions in the NFS letter.

Ng faced four charges of evading income taxes for Years of Assessment (“YAs”) 2008 to 2010 and 2012, as well as one charge for failing to file his income tax returns for YA 2011. These five offences had resulted in Ng failing to account for $80,399.01 in income taxes to IRAS.  In addition, he faced one charge for failing to register for GST between 1 March 2008 and 31 December 2011, which had resulted in Ng failing to account for GST totalling $453,105.24.

For the two proceeded charges on income tax evasion, Ng was sentenced to 6 weeks’ imprisonment. In addition, the Court ordered Ng to pay a penalty of $129,794.85, which is three times the amount of income taxes evaded.

For failure to register for GST, the Court fined Ng $5,000 and ordered him to pay a penalty of $45,310.52, a sum that is 10% of GST due.

What does this mean to you?

GST Registration
All businesses, including individuals deriving income from their trade, profession or vocation, should closely monitor their income and regularly assess if they need to register for GST.  Any business that fails to register for GST is still required to pay GST on all their past transactions from the date the business became liable for GST registration. GST is payable even if the amount was not collected from customers. In addition, failure to register for GST is an offence and businesses may be required to pay 10% of GST due as a penalty, and fined up to $10,000.

Income Tax
IRAS takes a serious view of non-compliance and tax evasion.  Any person who fails or neglects without reasonable excuse to furnish a return of income shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $1,000, and, in default of payment, imprisonment for a term of up to six months.

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Income Tax – Three individuals to be charged for tax evasion of rental income


It was reported on IRAS’ website on 16 March 2018 that 3 individuals were charged in the court in 2 separate cases for tax evasion on their rental income.

  • 2 persons were charged on 16 March 2018, for the omission of rental income from their tax returns.  More specifically, one of them faced 4 charges involving omitted rental income amounting to $411,252 for Years of Assessment (YAs) 2010 to 2013 which resulted in a total of $69,065.20 in tax undercharged. The other faced 3 charges involving omitted rental income amounting to $299,769 for YAs 2012 to 2014 which resulted in a total of $52,854.75 in tax undercharged. In addition, this individual will face another charge for the non-filing of his income tax returns.
  • One would be charged on 13 April 2018  for submitting falsified invoices to IRAS to support claims made for rental expenses between YAs 2009 to 2013. The individual will face 5 charges involving the submission of falsified invoices that amounted to $284,308.52. This resulted in a total of $56,499.91 in taxes undercharged.

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Income Tax – Director of metal stamping company to be charged for tax evasion


It was reported in IRAS’ website on 22 March 2018 that a company director was charged in court for assisting his company to evade tax.  He faced 5 charges involving the making of false entries in his company’s income tax returns from Years of Assessment (YAs) 2009 to 2013, which resulted in $648,427.90 in tax undercharged.

In addition, he will face 17 charges for without reasonable excuse, making an incorrect return by understating output tax in his company’s GST returns amounting to $266,870.58 during the same period.

What does this mean to you?

Upon conviction, he may face a penalty of two times the amount of tax undercharged, and a fine not exceeding $5,000 or to imprisonment for a term not exceeding 3 years or to both.

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