Printing firm director jailed 9 months and fined $250k for tax evasion, money laundering

SINGAPORE - To evade taxes, the director of a silk printing firm misreported his firm's earnings and asked customers to pay in cash to avoid accounting for them.

He then used the money from the understated sales to make downpayments for a condominium unit and a vehicle, as well as repay a loan for his HDB flat.

On Monday (June 20), Loh Chia Wei, 48, was jailed for nine months and ordered to pay penalties totalling $253,195. He had earlier pleaded guilty to multiple charges for offences that include tax evasion, money laundering and cheating.

The police and Inland Revenue Authority of Singapore (Iras) said in a statement on Tuesday that Loh had conducted cash sales with Print Orient's customers without accounting for them in the firm's income tax and GST returns.

He deliberately did so to evade taxes, and was undercharged by some $180,000 for goods and services tax and corporate income taxes between 2011 and 2017, said Iras.

In August 2013, Loh also instructed his staff to alter inventory figures to inflate his company's profits in its management accounts for the financial year.

He then e-mailed the management accounts containing the inflated profits to Maybank in an attempt to cheat it into approving Print Orient's loan application, said Iras.

Loh was also convicted of money laundering for using the understated sales of Print Orient to repay the loan for his HDB flat and the downpayments for his condominium and vehicle.

These expenses amounted to more than $400,000, said Iras.

It was not mentioned how his offences came to light.

Those who evade taxes can face jail time and penalties of up to four times the amount of tax evaded, Iras added.

The punishment for money laundering and cheating is jail of up to 10 years and a fine.

Iras urged businesses and individuals to come clean on any past tax mistakes, which will be seen as a mitigating factor when considering action to be taken.

It added that a reward based on 15 per cent - capped at $100,000 - of the tax recovered will be given to informants if the information and documents provided lead to a recovery of tax that would otherwise have been lost.

Informants' identities will be kept confidential, Iras added.