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Stamp duty

Tax evasion or fraud is a criminal offence, punishable under the law.  In fairness to the majority of people who meet their obligations, and to ensure that public confidence is maintained in the tax system, we are strongly committed to deterring, detecting and dealing with tax evasion and fraud. Our investigation programme swiftly and effectively detects and corrects such behaviour.

We deal with tax evasion and fraud by:

  • gathering and analyzing intelligence on risks and threats to the tax system
  • investigating suspected cases with a view to prosecution
  • complementing our criminal investigation work with civil audit work and the application of tax penalties
  • publicizing the outcomes of convicted cases to raise community awareness
  • reporting to ICPAS the tax practitioners who are deliberately doing the wrong thing.

On this page:

What can I expect if I am investigated for potential tax offences?

1. How a tax investigation is conducted

An investigation may be conducted in the following manner:

  • Conduct a surprise visit to your business premises to ask for your accounting records, source documents and other relevant records, both paper and electronic.
  • A surprise visit may also be conducted simultaneously to your residence and to the premises of your tax agent or representative and any relevant 3rd parties.
  • Searches may be conducted during the surprise visit, if necessary.
  • Arrange to meet and interview you, your family members, your staff, your tax agent or representative, your suppliers and any relevant 3rd parties.
  • Obtain information from or verify information with other 3rd parties such as other government agencies, banks and financial institutions, foreign tax authorities etc.
2. How to identify IRAS officers

If you are under investigation for potential tax offences, our first contact with you would usually be in person.  When our officers meet with you, they will show you their authority cards bearing their name and photograph.  At same time, our officers will introduce themselves, provide their full names and give you their contact details so that you can contact them for further information if you need it.  They will also give you a letter stating the purpose of visit and what is required of you. Should you require confirmation on the identity of the holder, please call IRAS on 6351 2044 or 6351 2046.

IRAS will not tolerate any acts of mischief or criminal intent by any person who impersonates himself or herself as an IRAS officer.

3. Scope of Investigation

The investigation may cover issues on individual income tax, corporate company income tax, and Income Tax, GST and other tax types administered by IRAS.   The investigation aims to uncover the full facts to determine whether any tax offences have been committed.

Where there is fraud, the statutory limitation provided under Section 74(1) of Income Tax Act and Section 45(5) of GST Act is not applicable.  Tax assessment may be made at any time beyond the following statutory limitation:

For Income Tax

  • 6 years, if the year of assessment is 2007 and earlier or
  • 4 years, if the year of assessment is 2008 onwards.

For GST

  • 7 years from the end of the prescribed accounting period, in the case of a prescribed accounting period ending before 1 January 2007; and
  • 5 years from the end of the prescribed accounting period, in the case of a prescribed accounting period ending on or after 1 January 2007.
4. Confidentiality

You have a right to the same high degree of confidentiality as all taxpayers.

It may be necessary for us to seek information about you or your business from other people or organizations.  If this is the case, we will be as discreet as possible about the reasons for our enquiries.  However, in the case of seeking information from the banks, we will need to inform them, as required by the Banking Act, that it is in relation to our investigation of a criminal offence.

5. Fairness and Professionalism

We will keep an open mind to the possibility that there may be an innocent explanation for the suspected irregularities.  We undertake to treat you fairly, professionally, courteously and in accordance with the tax laws.

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What does IRAS expect from me during an investigation?

1. Cooperation

The investigation will be undertaken with or without your voluntary cooperation.  If you do cooperate, the investigation will proceed more quickly, efficiently and advantageously for both parties than if you refuse to cooperate.    Your conduct and cooperation during the course of the investigation shall affect the level of mitigation when IRAS determines the appropriate punishment for the tax offences.

2. Access to Premises and Information

Section 65B of Income Tax Act and Section 84 of GST Act set out the powers of our officers to obtain information, specifically on the powers to have full and free access to your premises, records, data and documents.  The officers may inspect, copy and take possession of the books, records, data and documents, and download relevant information from all electronic storage media, where necessary.

The officers may secure, take possession, photograph and record statements from the users/owners where computers are identified.  The electronic data residing in the computers may be captured and preserved as admissible evidence in court.  The officers will capture 80% of the electronic data within 2 working days and 100% within 3 working days for critical systems to minimize disruption to business operation.

It is an offence to hinder or obstruct the officers in carrying out their duties under the tax laws. A person guilty of such offence, shall be liable on conviction to a fine not exceeding $5,000 or to imprisonment for a term not exceeding 6 months or to both.

3. Providing Information 

You are required to provide the information and documents that IRAS requested.  You will be given a reasonable amount of time to provide any information if it is not readily available. You should ensure that any information you provide and any answers you give are correct and complete.  It is important that you give us all the relevant facts even if you are in doubt about the tax consequences of a particular matter.   False statements can result in a criminal investigation with a view to prosecution.

4. Maintaining Records

Under the Income Tax Act and the GST Act, persons liable to pay income tax and GST are required to keep their business records for at least seven years, for accounting periods ending before 1 January 2007, and at least five years for accounting periods ending on or after 1 January 2007.

For businesses, we generally need all accounting and business records, source documents such as contracts, invoices, payment vouchers and receipts that substantiate all your transactions, bank statements and payment evidence.  For individuals, we need all documents and records pertaining to income and assets acquired as well as expenses incurred.  Please refer to the “Record Keeping Guide for GST- Registered Businesses” and  “Record Keeping Guide for Non-GST Registered Businesses”.

Please make sure that you keep all existing records, including computer records, in accordance with the records retention requirements as provided in the tax laws. 

5. Professional Representation

You may appoint a professional adviser to represent you during our investigation.  You should give your professional adviser all the facts because you are personally responsible for your tax affairs and the accuracy of any information supplied to us. You are also responsible for ensuring that your adviser complies with timetables agreed between us.  If there are delays or difficulties, we may deal directly with you.

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What happens at the conclusion of an investigation?

1. Length of Investigation

The length of investigation depends on the scope of investigation, complexity of the issues and the level of cooperation you and your professional adviser render during the investigation.  Under normal circumstances, an investigation may take about 15 – 24 months to complete.

2. Conclusion of Investigation

We will usually meet with you and your professional adviser (if you engage one) to discuss any findings that we may uncover during the course of the investigation.  However, upon the conclusion of the investigation, we will meet to discuss and finalize the findings and tax assessments and also give you an opportunity to explain any tax irregularities that we have uncovered in the investigation.

We may invite you to make an offer of settlement to resolve the investigation.  The offer of settlement would comprise the total additional tax payable and a composition amount that you would like to pay to resolve the investigation.   Depending on the severity of the tax offence, the composition amount can be up to 100%, 200%, 300% or 400% of the additional tax payable.

But if it is established that there is a wilful intent to evade tax or to assist another person to evade tax, we will not hesitate to initiate legal proceedings to prosecute you and the abettors for tax evasion.

3. Offences and Penalties for Serious Fraudulent Tax Evasion

Under the Income Tax Act, any person who wilfully with intent to evade or to assist any other person to evade tax shall be guilty of an offence for which, on conviction, he shall pay a penalty of 4 times the amount of tax which has been undercharged in consequence of the offence or which would have been undercharged if the offence had not been detected, and shall also be liable to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 5 years or to both.

Under the GST Act, any person who wilfully with intent to evade or to assist any other person to evade tax shall be guilty of an offence for which, on conviction, he shall pay a penalty of 3 times the amount of tax which has been undercharged in consequence of the offence or which would have been undercharged if the offence had not been detected, and shall also be liable to a fine not exceeding $10,000 or to imprisonment for a term not exceeding 7 years or to both.

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Recent Investigation activities and results

We will not hesitate to take enforcement actions against non-compliant businesses.  All these cases are publicized in the press. 

For IRAS’ audit attention for years 2009 and 2010, please refer to :

  1. IRAS’ Focus on Compliance for Individual Income Tax
  2. IRAS’s Focus on Compliance for Corporate Income Tax
  3. IRAS’s Focus on Compliance for GST
Recent Prosecutions

As part of pursuing a fair tax system, and to protect our compliant taxpayers, we occasionally have no option but to prosecute taxpayers who intentionally and fraudulently evade their tax obligations. This is not a course of action that we pursue lightly, but which we are not afraid of using in serious cases.

For GST 
Published on Title

 21 Dec 2012

Two Caught for Fraud in Tourist Refund Claims 

 25 Oct 2012

Fraudulent GST claims put sole-proprietor in jail 

 19 Oct 2012

First trader charged for false declaration in GST Registration 

 20 Jul 2012

First retailer fined over failure to display GST-inclusive prices 

 4 Jul 2012

Company manager jailed for GST fraud 

 23 Mar 2012

Private schools pays $70,000 in penalty for failure to register for GST 

 30 Dec 2011

An UnUsUal Oversight 

 8 Nov 2011

Records were burnt but IRAS uncovers GST fraud 

 16 Sep 2011

Tourist Found Guilty of False GST Claims 

 29 Jul 2011

Company and Director charged in court for GST fraud 

 12 Nov 2010

Restaurant and director fined for unauthorised collection of GST 

27 Aug 2010

Automotive spare parts trader convicted of evading GST and income tax

13 Aug 2010

Man in biggest GST fraud case jailed, fined $17m 

19 Jul 2010

Partner of Stienberg & Lindsey Food and Beverage convicted of GST fraud 

4 Jun 2010

Managing director of V-Teb Services Pte Ltd jailed for GST fraud 

6 Nov 2009

Company director of 3D International Pte Ltd convicted of GST fraud 

24 Jul 2009

Sole-proprietor of Syaz Food Services charged for GST fraud

11 Feb 2009

Sole-proprietor of Spares International charged for GST fraud

13 Feb 2009

Director of United Team jailed for GST fraud

16 May 2008

GST trader sentenced to 6 months jail and penalty

15 Feb 2008

GST trader charged on wrongful GST claims

 

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For Corporate Income Tax 

 

Published on Title

 3 Aug 2012

Company pays penalty of a quarter million for tax evasion 

 18 May 2012

Technology Company Convicted of Tax Evasion 

 2 Mar 2012

Director of Metal Stamping Company Jailed for His Role in Tax Evasion 

 4 Mar 2011

Second Company Convicted of Abusing Tax Exemption Scheme 

 6 Aug 2010

Director and her trading company convicted of tax evasion 

14 Jul 2010

Finance Manager of Warehousing and Logistics Company Convicted of Tax Evasion and Abuse of Tax Exemption Scheme for New Companies

25 June 2010

Company operating dormitories and managing foreign workers convicted for tax evasion 

24 Jul 2009

The first company and director to be charged and convicted for claiming fictitious expenses relating to “phantom workers” 

3 Jul 2009

Director and his construction company charged for tax evasion 

7 Apr 2008

Director of construction firm charged for tax evasion

14 Dec 2007

Director of Recycling Company Charged for Tax Evasion

14 Jun 2007

Consultant Charged for Abetting Company Director To file Incorrect Income Tax Return

 

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For Individual Income Tax
Published On Title

22 Nov 2012

Remisier Convicted for Tax Evasion 

7 Mar 2012

CPA pays a heavy penalty for assisting company to evade tax 

 26 May 2011

Specialist eye consultant and surgeon convicted for tax evasion 

 6 May 2011

Sole proprietor jailed for under-reporting profits 

12 Oct 2010

Businessman jailed for omission of rental income 

27 Aug 2010

Automotive spare parts trader convicted of evading GST and income tax

16 Apr 2010

Two partners of chemical treatment business jailed for tax evasion 

27 Oct 2009

First company and its director to be convicted of abusing tax exemption scheme 

4 May 2009

Sole proprietor pays hefty penalties of about $ 980,000 for tax offences 

12 Dec 2008

Food court partner charged for tax evasion 

18 Jan 2008

Supplier of Hup Lee Fried Bee Hoon charged for tax evasion

18 April 2008

Bookkeeper charged for tax evasion

5 Oct 2007

Curry Puff Hawker Charged for Tax Evasion

 

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For Stamp Duty
Published On Title

18 Jan 2013

Property Agent Jailed Two Weeks for Using Fake Stamp Certificates 

15 May 2012

Property Agent Jailed 12 weeks for Using Fake Stamp Certificates 

11 Feb 2010

First person to be convicted of counterfeiting Stamp Certificates 

 

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Last Updated on 15 March 2011


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