Dentist to pay $40,716 in fines and penalties for omission of income and failure to register for GST

30 Oct 2020

Oh Chih Min ("Oh"), 44, a dental surgeon and director of The Dental Practice (Bedok) Pte Ltd ("TDP-B") and The Dental Practice (Paya Lebar) Pte Ltd ("TDP-PL"), was ordered by the Court to pay fines and penalties totalling $40,716 after being convicted for abetting TDP-B in making an incorrect income tax return and in respect of the late registration of TDP-B for Goods and Services Tax (GST).

Oh faced one charge of abetting the company, TDP-B, in omitting its business income of $175,701, including reimbursement claims received through Community Health Assist Scheme ("CHAS"), in its Year of Assessment (YA) 2015 income tax returns, resulting in $10,454 in income tax being undercharged.

As the director of TDP-B, Oh also faced another charge of failing to notify the Comptroller of GST by 30 April 2014 of TDP-B’s liability to register for GST, when its turnover had exceeded the $1 million threshold in the four quarters ending 31 March 2014.  TDP-B was only registered more than one year later.  The late registration had resulted in under-payment of GST amounting to $118,074.

Court Sentences

For abetting TDP-B in making incorrect income tax returns without reasonable excuse, Oh was ordered by the Court to pay a fine of $4,000 and a penalty of $20,909, which is two times the amount of income tax undercharged. For failing to notify the Comptroller of GST of TDP-B’s liability to be registered for GST, Oh was ordered by the Court to pay a fine of $4,000 and a penalty of $11,807, which is 10% of GST due. 

Penalties for Non-Compliance

IRAS Warns Against Tax Evasion

IRAS takes a serious view of non-compliance and tax evasion. There will be penalties for those who make incorrect returns without reasonable excuse or negligently. IRAS will not hesitate to bring offenders to court. Offenders may face a penalty of two times the amount of tax undercharged.  Fines or jail terms may also be imposed.  

GST Registration

All businesses, including individuals deriving income from their trade, profession or vocation, should closely monitor their income on a calendar year basis to assess if they need to register for GST.  

If their 12-month taxable turnover has exceeded $1 million at the end of the calendar year, they will be required to apply for GST registration within 30 days.   

Any business that fails to register for GST is still required to pay GST on all their past transactions from the date the business became liable for GST registration. GST is payable even if the amount was not collected from customers. In addition, the failure to notify the Comptroller of the liability to register for GST is an offence and businesses are required to pay 10% of GST due as a penalty and fined up to $10,000.

Reporting or Disclosure 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, reveal evaded taxes, or report malpractices that might indicate tax evasion, 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 Informant   

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 leads to a recovery of tax that would have otherwise been lost. All payments are at the discretion of the Comptroller. IRAS would ensure that the identities of informants are kept strictly confidential.

     

Inland Revenue Authority of Singapore