SINGAPORE: A consultancy services provider has been sentenced to six months in jail and ordered to pay a penalty for evading taxes, the Inland Revenue Authority of Singapore (IRAS) said on Monday (Dec 23).
Ng Wee Kheng, the sole proprietor of a consultancy service company, had made false entries in his income tax returns and under-reported S$1.28 million in trade income.
This led to a total of S$246,992 in tax evaded for the Years of Assessment (YAs) 2015 to 2016.
For two counts of making false entries with the wilful intent to evade tax in his income tax returns, Ng was ordered to pay S$740,978 in penalties, which is three times the amount of tax evaded, said IRAS.
Ng ran SME Grant Assist (SGA), a company that provided consultancy services for customers to make Productivity and Innovation Credit claims. SGA was the main consultant engaged by SMS Machinery to provide services to its customers.
Being a one-man operation, Ng made all the business decisions for the firm, a court document said. He prepared all of the company’s invoices and collected all the cheque payments from clients.
His clients were charged between S$500 and S$4,000 and he banked in “almost all” of his firm’s receipts from customers into one OCBC account.
“Ng Wee Kheng knew that he earned more than what he had declared,” read the court document.
"GROSSLY UNDERSTATED AND FALSE" INCOME FIGURES
It said that Ng knew he was making false statements in his income tax returns because the income he reported to IRAS was “far less” than his known withdrawals from the bank account.
The bank statements from SGA itemising the cheque deposits and withdrawals made by Ng also showed that he knew his company's actual income.
“Ng Wee Kheng had filed his personal income tax returns for YAs 2015 and 2016 with false statements of the income he had earned which he knew to be grossly understated," said the document.
“After picking notional understated income figures, Ng Wee Kheng would make random minor adjustments to the understated figures to ensure that he did not file rounded figures in his income tax returns so as not to arouse IRAS’ suspicions that the figures he had declared were false.”
There will be severe penalties for those who wilfully evade tax, IRAS warned.
Offenders may face a penalty of up to four times the amount of tax evaded and could be jailed.