Parade Industries Pte. Ltd. (“Parade Industries”) and its director, Lim Beng Gwek, have been convicted of providing false information in the company’s Productivity and Innovation Credit (“PIC”) cash payout application form. The court ordered both the company and its director to pay total penalties of $300,000 and fines amounting to $14,000 for the wrongful claim of $60,000 of PIC cash payout by the company.

False PIC Claim on Old Equipment

Parade Industries is a manufacturing company that produces plastic packaging products. Parade Industries made a PIC cash payout claim for the purchase of an automatic vacuum forming machine (“the machine”) at a cost of $103,000 in the Year of Assessment (“YA”) 2014. Investigations revealed that the machine was in fact purchased by Parade Industries in 1999. Lim Beng Gwek had signed Parade Industries’ PIC cash payout application form which falsely reflected that Parade Industries had purchased the machine in YA 2014 to claim $60,000 of PIC cash payout on behalf of Parade Industries.

Court Sentences

Parade Industries was convicted of giving false information to the Comptroller of Income Tax, in order to obtain a PIC cash payout which it was not entitled to. The court ordered the company to pay a penalty of $180,000, which is three times the amount of the PIC cash payout that was wrongfully obtained, and a fine of $10,000.

Lim Beng Gwek was convicted of giving false information without reasonable excuse to the Comptroller of Income Tax to assist Parade Industries to obtain a PIC cash payout, which Parade Industries was not entitled to. The court ordered Lim Beng Gwek to pay a penalty of $120,000, which is two times the amount of PIC cash payout that was wrongfully obtained, and a fine of $4,000.

Severe Penalties for Abusing PIC Scheme

IRAS takes a serious view of any attempt by claimants, vendors or consultants to defraud the Government. Offenders convicted of PIC abuse will have to pay a penalty of up to four times the amount of PIC cash payout fraudulently obtained or which would have been obtained if the offence had not been detected, and a fine of up to $10,000 and/or imprisonment of up to five years.

Reporting of Malpractices

Businesses or individuals are encouraged to immediately disclose any past mistakes. IRAS will treat such disclosures as mitigating factors when considering action to be taken. Those who wish to disclose past mistakes or wish to report malpractices or potential abuses of the PIC scheme can write to:

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

Inland Revenue Authority of Singapore