Sole proprietor to pay penalty of more than $400,000 for making incorrect GST returns without reasonable excuse

26 Apr 2019

Penalised $67,000 for failing to file income tax returns for two years or more despite repeated reminders

Teo Beng San (“Teo”), the sole proprietor of Total Metal & Hardware Trading, Passions Beauty & Skincare Centre and Total Maid Agency, was ordered to pay fines and penalties totalling $415,947 after being convicted of tax offences.

Teo faced (a) three charges of failing to file his income tax returns for Years of Assessment (YAs) 2011 to 2013 for more than two years as well as (b) ten charges for making incorrect returns without reasonable excuse in his businesses’ GST returns between 2010 and 2013 by understating output tax.

Court Sentences (Proceeded Charges)

Teo pleaded guilty to two charges of failing to file his income tax returns for more than two years and was ordered to pay fines totalling $1200 and a penalty of $67,085, which is two times the amount of income tax evaded.

He also pleaded guilty to three charges of making incorrect returns without reasonable excuse in his GST returns and was sentenced to fines totalling $7000 and a penalty of $340,662, which is two times the amount of tax undercharged. The remaining eight charges were taken into consideration for the purpose of sentencing.  

IRAS Warns Against Non-Compliance

Failure to furnish a return of income

Anyone who continually fails without reasonable excuse to file their outstanding tax returns despite reminders from IRAS may face prosecution action under section 94A(3) of the Income Tax Act. The penalty for failure to file income tax returns for any YA for more than two years is double the tax amount assessed to be liable and a fine of up to $1,000.

Submitting Incorrect GST Returns

It is a serious offence to claim GST input tax on fictitious purchases or understate output tax on sales. Offenders face a penalty of up to 3 times the amount of tax undercharged, a fine not exceeding $10,000, and/or imprisonment of up to 7 years.

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

Cash Rewards for Informants

A reward based on 15% of the tax recovered, capped at $100,000, will 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