Tag Archives: IRAS

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 – Accomplice of GST fraud mastermind put in jail


It was reported in IRAS’ website on 2 August 2018 that
Sng Kay Heng who is a sole proprietor of Strikey Trading was found guilty and convicted of making false entries in the GST returns of his business entity, resulting in GST refunds totaling $30,806.61.

Sng was the accomplice of Eric Chan, who was convicted in July 2014 for masterminding a complex GST scam by using multiple shell entities and colluding with Sng to defraud the Comptroller of GST of GST refunds.  Sng had voluntarily registered himself for GST in October 2005.

IRAS’ investigations revealed that Sng, who elected to file his GST returns on a monthly basis, made false entries in his GST returns for the accounting periods ended November 2005, December 2005 and January 2006.

Investigations further revealed that the suppliers whom Strikey Trading had purportedly made purchases from confirmed that they did not make any sales to Strikey Trading.

Sng had claimed trial to 3 GST charges of making false entries with wilful intent to evade tax in his GST returns.  The Court sentenced Sng to 6 weeks’ imprisonment and ordered him to pay a penalty of $92,000, which is 3X of the amount of tax undercharged.

What does this mean to you?

Under Singapore GST law, it is a serious offense to claim GST input tax on fictitious purchases or understate output tax on sales. Offenders face a penalty of up to 3 times the amount of tax undercharged, a fine not exceeding $10,000, and/or imprisonment of up to 7 years.

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Singapore GST – Request For Extension of Filing GST Form F5


For Singapore GST purposes, all GST-registered businesses are required to file their GST returns on time.  The IRAS considers one month after the end of the prescribed accounting period a reasonable deadline and no extensions will be granted.

Nevertheless, IRAS has announced that it is prepared to grant an extension of time for newly registered businesses and for businesses which fall within the following list of acceptable reasons:

  • Newly GST-registered businesses (1st GST return) – 1 month
  • Fire disaster – 2 months (submission of the police report and the insurance claim is required)
  • Breakdown of computer systems – 2 months (submission of the IT servicing report is required)
  • Purchase of new accounting software and/or IT systems – 2 months (submission of the tax invoice is required)
  • Key accounting personnel on medical leave of more than 1 week  – 2 months (submission of medical/ hospitalization certificates is required).

Affected businesses should email IRAS at least 3 working days before the filing due date with the supporting documents (where applicable) to enable IRAS to have sufficient time to process the request for an extension of time to file their GST F5.

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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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