Man fined for not registering online sales for GST, ordered to pay penalty of over $11,000

Edwin Pang had pleaded guilty to one charge under the Goods and Services Tax Act.
Edwin Pang had pleaded guilty to one charge under the Goods and Services Tax Act.ST PHOTO: KELVIN CHNG

SINGAPORE - The first person to be convicted of failing to register his online sales for goods and services tax (GST) has been ordered to pay a penalty of more than $11,000.

Edwin Pang Chung Jie, 40,was also fined $4,000 on Friday (Nov 27).

He had pleaded guilty to one charge under the Goods and Services Tax Act.

Four other charges were taken into consideration during sentencing by District Judge Ong Luan Tze.

Two were for submitting incorrect income tax returns without reasonable excuse and the other two related to failing to keep proper records of the invoices he received linked to his businesses.

In a statement on Oct 30, the Inland Revenue Authority of Singapore (Iras) said Pang sold mobile phones and accessories on online platforms such as Lazada, Shopee and Carousell.

He conducted his business through, among others, two firms he solely owned, Edmobile and Moogi, tax prosecutor Victoria Chong told the court.

"Investigations revealed that the total value of the accused's taxable supplies for the four quarters ended Dec 31, 2012, to Sept 30, 2013, had exceeded $1 million," she said.

Pang was therefore required to notify the Comptroller of GST of his liability to be registered for GST by Oct 30, 2013.

But he failed to do so, resulting in $118,023.23 of tax being due for the period between Dec 1, 2013, and Sept 30, 2015.

The court heard that Pang, who is bankrupt, has since made partial restitution.

District Judge Ong eventually sentenced him to the fine and ordered him to pay a penalty of $11,802.32.

Failing to register for GST is an offence and errant businesses may have to pay 10 per cent of the GST due as a penalty, and may incur a fine of up to $10,000.

In its statement, Iras said that between 2015 and last year, it recovered more than $3.8 million in taxes and penalties from 65 audit cases on taxpayers who operate online businesses.

It said that all income from online and e-commerce businesses in Singapore must be reported for tax purposes.

"Individuals, sole proprietors or partners of a partnership who are in receipt of more than $6,000 in annual net business income in the current year will be required to file a tax return for the year of assessment 2021 during the tax filing period from March 1 to April 18, 2021," it added.

Employees who separately earn additional income from running an online business on the side will also have to declare such income under the Trade, Business, Profession or Vocation section in their individual income tax return, it said.