Soh Kay Hee ("Soh"), a manager at Presido International ("Presido"), flouted the law when he unlawfully charged Goods and Services Tax (GST) on a total of 1,095 sales invoices issued to his customers.

Soh pleaded guilty to the 64 charges proceeded on. For unlawfully charging $19,772.80 as GST, he has to pay $136,118.40 in penalties and fines, which is more than 6 times the amount of GST. In default of paying $136,118.40, he has to serve a total of 320 days of imprisonment. Another 260 similar charges were taken into consideration in sentencing.

In addition, the Inland Revenue Authority of Singapore (IRAS) compounded some of his offences for $81,760.78. This was twice the amount of GST wrongfully charged by him on the sales invoices.

Unauthorised issuing of tax invoice and collection of GST

IRAS conducts regular audits to identify businesses that do not comply with GST laws. This case was uncovered in one of such audit programmes to check whether businesses charge, collect and claim GST correctly.

Soh listed his wife Goh Ka Cheng ("Goh") as the sole proprietor of Presido, a wholesale business of security and fire fighting equipment. Neither of them is a GST-registered person.

IRAS' investigations revealed that from 21 Nov 2002 to 11 Jun 2010, Soh issued sales invoices which reflected the prevailing rate of GST to Presido's customers when he was not supposed to do so. The GST that Soh collected unlawfully on 1,095 sales invoices amounted to $68,000. He deposited the money into Presido's bank account and used it to pay for his business and family expenses, as well as credit card bills.

Penalty for unauthorised charging and collecting of GST

Only GST-registered businesses are allowed to charge GST on their sales. It is an offence for non GST-registered businesses to issue tax invoices charging and collecting GST on their sales. Offenders face a penalty of three times the amount of tax shown on the invoice and are liable to a fine of up to $10,000.

Report GST malpractices to IRAS

Members of the public can check if a business is registered for GST on IRAS' website. All they need to do is to key in the business name or business registration number at the following link:

https://mytax.iras.gov.sg/ESVWeb/default.aspx?target=GSTListingSearch.

Anyone who wishes to report cases of malpractices by businesses can write to:

Inland Revenue Authority of Singapore
Investigation & Forensics Division
55 Newton Road, Revenue House
Singapore 307987
Email: [email protected]

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

Inland Revenue Authority of Singapore