One director and two former directors of iQuartz Pte Ltd (“IQPL”), a company that trades in marble and granite stones and which previously operated under the name of Stonetile Enterprise Pte Ltd, have been convicted by the Court for:

(a)  making a false entry in IQPL’s Corporate Income Tax return for Year of Assessment (YA) 2015 resulting in $31,878 of taxes undercharged; and
(b)  understating output taxes in IQPL’s Goods and Services Tax (GST) returns for prescribed accounting periods ended June 2013 to March 2014 resulting in $29,801 of taxes undercharged.

The trio consists of 58-year-old Chia Poh Yong Tony (“Chia”), 45-year-old Chong Chew Yee (“Chong”) and 53-year-old Yong Chon Ben (“Yong”) (collectively, “the Directors”).

IQPL, a GST-registered company since 1999, did not account for GST on its cash sales in 2013 and 2014. This resulted in an understatement of IQPL’s output taxes in its GST returns. IQPL’s income was also deliberately under-declared by failing to account for the cash sales. A loss of $5,357 was declared for IQPL’s YA 2015 Corporate Income Tax return when its actual income was $420,388. 

Court Sentences

Chia pleaded guilty to one charge of abetting by instigating Chong to falsely state IQPL’s total income in its Corporate Income Tax return for YA 2015. The Court sentenced Chia to 6 weeks of imprisonment and ordered him to pay a penalty of $95,636, which is three times the amount of taxes undercharged. 

Chong pleaded guilty to one charge of making a false entry in IQPL’s Corporate Income Tax return for YA 2015 with the wilful intent to assist IQPL in evading tax. The Court sentenced Chong to 6 weeks of imprisonment and ordered her to pay a penalty of $95,636, which is three times the amount of taxes undercharged.

Yong pleaded guilty to one charge of abetting by intentionally aiding Chong to make the false entry in IQPL’s Corporate Income Tax return for YA 2015 by confirming in IQPL’s Directors’ Report and Statement by Directors for YA 2015 that IQPL’s attached income statement was true and accurate despite being aware that it was false. The Court sentenced Yong to 6 weeks of imprisonment and ordered him to pay a penalty of $95,636, which is three times the amount of taxes undercharged.

Chia, Chong and Yong each also pleaded guilty to four charges of understating IQPL’s output tax in the company’s GST returns for prescribed accounting periods ended June 2013 to March 2014. The Court sentenced each of them to 1 week of imprisonment and to pay a penalty amount of $89,404, which is three times the amount of taxes undercharged.

Penalties for Non-Compliance

Fraudulent GST Claims

It is a serious offence to wilfully evade tax by submitting false GST returns such as by understating any output tax, overstating any input tax, excluding taxable supplies or including fictitious transactions. Upon conviction, offenders are liable to pay a penalty of three times the amount of tax undercharged and are liable to be punished with a fine not exceeding $10,000, and/or to imprisonment of up to seven years.

With the endorsement of the enhanced sentencing framework for GST evasion by the High Court on 17 January 2022 following the case of PP v. Pua Om Tee, offenders will face a stiffer imprisonment sentence which takes into account the harm caused by the offender and his or her culpability, such as the quantum of tax evaded, the degree of planning and premeditation and sustained period of offending. The imprisonment term imposed for GST evasion under Section 62 of the GST Act may span the full range of up to seven years.

IRAS Warns Against Tax Evasion

IRAS takes a serious view of non-compliance and tax evasion. There will be severe penalties for those who wilfully evade tax. Taxpayers are ultimately responsible for the information declared in their income tax returns. The authority will not hesitate to bring offenders to court. Penalties for tax evasion can be up to four times the amount of tax evaded. Jail terms may also be imposed.

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 or report malpractices can write to:

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

Email: [email protected]

 Cash Rewards for Informants

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 will ensure that the identities of informants are kept strictly confidential.

Inland Revenue Authority of Singapore