Former Businessman First to be Charged for Failure to Register GST for Online Sales

30 Oct 2020

Edwin Pang Chung Jie (“Edwin Pang”), 40, is first to be charged for failing to register for Goods and Services Tax (GST), in respect of online sales made over various online shopping platforms including Lazada, Shopee, Qoo10 and Carousell. Edwin Pang owned two sole-proprietorships, Edmobile and Moogi, selling mobile phones and mobile phone accessories online. He also faced two charges for submitting incorrect Income Tax returns without reasonable excuse and another two charges for failing to keep proper records of invoices received by him in relation to his sole-proprietorship’s businesses. The total tax involved amounted to $129,411.

IRAS’ Audits on Online Businesses

Between 2015 and 2019, the Inland Revenue Authority of Singapore (IRAS) recovered more than $3.8 million in taxes and penalties from 65 audit cases on taxpayers who operate online businesses.  The audit findings show the following compliance issues of online business owners:

  • Omission of income derived from online business in Income Tax Return

  • Claims made for business expenses that are not tax-deductible

  • Failure to register for GST when 12-month taxable turnover has exceeded $1 million at the end of the calendar year

  • Failure to keep proper record and documentary evidence

Please refer to the enclosed factsheet (PDF, 116KB) on what online business owners should comply with.   

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. The authority will not hesitate to bring offenders to court. Offenders may face a penalty of up to four times the amount of tax evaded. Jail terms may also be imposed.

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.

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: ifd@iras.gov.sg

 

Inland Revenue Authority of Singapore