Kho Foong Kuin (“Kho”), a director of a security and firefighting supplies company, Speed Safety International Pte Ltd (“Speed Safety”), has been convicted for not reporting the amount of Good and Services Tax (GST) collected from the sale of a non-residential property at Tuas View Place (the “Property”) in the company’s GST return with wilful intent to evade GST. The Court sentenced Kho to 4 weeks’ jail and ordered her to pay a penalty of $173,880 – three times the amount of GST evaded. 

Offence for failing to account for output tax on sale of non-residential property

IRAS’ investigations revealed that Speed Safety had sold the Property on 30 June 2014. The buyer paid Speed Safety $828,000 for the Property and $57,960 for the 7% GST on the selling price.

 Kho, who was responsible for filing GST returns for Speed Safety, had previously made a full claim from IRAS on the input tax amounting to $45,454.49 paid for the purchase of the Property. Kho knew that she was required to declare and pay IRAS the output tax of $57,960.00 collected for the sale of the Property. However, Kho intentionally did not do so as she wanted to use the sales proceeds, including the GST collected, to alleviate Speed Safety’s financial difficulties.

Charging and Accounting for GST

Businesses may buy and sell properties in the course of their business. Under the GST Act, GST-registered businesses have to account for GST collected on the sale of non-residential properties as an output tax in their GST returns. They can also claim the GST paid on the purchase of non-residential properties as an input tax in their GST returns.

How IRAS detects GST omissions

IRAS conducts regular audits of GST-registered businesses, and such GST omissions can be detected through the use of data analysis and risk profiling.

 It is a serious offence to omit or understate output tax on sales. Offenders face a penalty that is up to 3 times the amount of tax undercharged, and a fine not exceeding $10,000 or imprisonment of up to 7 years or to both.

Disclosure or Reporting of Malpractices

Businesses or individuals are encouraged to immediately disclose any past tax mistakes. IRAS will treat such disclosures as mitigating factors when considering action to be taken. Those who wish to disclose past mistakes, reveal evaded taxes, or report malpractices that might indicate tax evasion, can write to:

Inland Revenue Authority of Singapore
Investigation & Forensics Division
55 Newton Road, Revenue House
Singapore 307987

Email: [email protected]

Cash Rewards for Informant

A reward based on 15% of the tax recovered, capped at $100,000, would be given to informants if the information and/or documents provided lead to a recovery of tax that would have otherwise been lost. All payments are at the discretion of the Comptroller. IRAS would ensure that the identities of informants are kept strictly confidential.

Annex A - Common Mistakes (PDF, 263KB)
Compliance Media Story on GST (PDF, 144KB)

Inland Revenue Authority of Singapore