SINGAPORE - A tuition centre and a second-hand car trader have been fined for failing to register for Goods and Services Tax (GST) when their businesses crossed the $1 million threshold.
On Friday (May 17), Ideas Ink School Pte Ltd, a tuition centre located in one-north Gateway, was fined $2,000 and ordered to pay a penalty of $7,645 for failing to register for GST by July 30, 2012, when it crossed the threshold in the previous quarter.
Tay Soon Suan, 74, a Singaporean second-hand car trader, was also fined $6,000 along with a $68,464 penalty for a similar tax offence.
Tay, the director of Gunong Djati Credit Pte Ltd and Gunong Djati Trading Co Pte Ltd in Upper Serangoon Road, had failed to register for GST by April 30, 2012, despite crossing the $1 million mark in the previous quarter.
Businesses in Singapore need to register for GST when their past 12-month taxable turnover exceeds $1 million at the end of any calendar quarter. They will then have 30 days to do so.
The two directors of Ideas Ink School, who are brothers, were also convicted for under-declaring their income in their tax returns.
Pek Kim Beng, 33, was fined $6,000 and ordered to pay a penalty of $95,584, while Pek Kim Yew, 31, was fined $2,000 along with a $14,831 penalty.
Their mother Chee Mee Yen, 66, the firm's bookkeeper, is currently facing charges for abetting them in evading taxes.
According to court documents, her duties included administrative work, collection of tuition fees, managing the payment of salaries and the preparation of the accounts.
When payment is due, the students' parents would pay either in cash or by cheques. The cheques would be deposited in the relevant bank accounts, while cash received would be kept by Chee, and later paid out as cash salaries to the directors and other tutors.
Chee also helped prepare the income tax returns for the two directors, with investigations revealing that the cash salaries were omitted.
The Inland Revenue Authority of Singapore (Iras) said in a press statement that it takes a serious view of non-compliance and tax evasion.
"There will be severe penalties for those who wilfully evade tax. Taxpayers are responsible for the information declared in their income tax returns. The authority will not hesitate to bring offenders to court," Iras said.
It added that penalties for tax evasion can be up to four times the amount of tax evaded, with jail terms imposed in certain situations.
Iras also said there are cash rewards for informants if their information leads to a recovery of tax that would otherwise have been lost.
The reward is based on 15 per cent of the tax recovered, capped at $100,000, and handed out at the discretion of the Comptroller.
The identities of informants are also kept strictly confidential.