Two company directors jailed for omitting more than S$600,000 in bonuses from income tax returns

Two company directors jailed for omitting more than S$600,000 in bonuses from income tax returns

handcuffs
File photo of handcuffs. (Photo: TODAY)

SINGAPORE: Two company directors have been sentenced to jail for omitting more than S$600,000 in bonuses from their income tax returns, the Inland Revenue Authority of Singapore (IRAS) said in a news release on Friday (Oct 11).

Koh Kok Huat, 68, and Adrian Yeo, 39, directors of both Foster Asia Pacific and Ematco Industrial faced three charges for "making false entries in their income tax returns with the wilful intent to evade tax".

They each pleaded guilty to one charge, with two other similar charges taken into consideration for sentencing.

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Both were sentenced to three weeks’ jail each. Koh was also sentenced to a S$93,086 penalty, while Yeo's penalty was S$68,797.

The penalties are three times the amount of tax evaded based on the charges each man had pleaded guilty to.

IRAS said that Koh and Yeo decided how much bonus was to be paid to themselves, after which the financial manager of the companies would prepare the corresponding payment vouchers and cash cheques for them.

However, the payment vouchers stated that those bonus payments were for supposed “subcontractor fees”, despite it not being the case.

The financial manager also booked those bonus payments under the “sub-contractor fees” account in the companies’ financial records.

"Koh and Yeo, with the wilful intent to evade tax, did not report the bonuses from Foster Asia and Ematco as employment income in their personal income tax returns," IRAS said.

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For the years of assessment 2011 to 2013, Koh did not declare bonuses totalling S$337,000, resulting in undercharged taxes of S$64,805, IRAS said.

During the same period, Yeo did not declare bonuses totalling S$280,360, resulting in undercharged taxes of S$49,680.

"IRAS takes a serious view of non-compliance and tax evasion. There will be severe penalties for those who wilfully evade tax," the authority said.

"Offenders may face a penalty of up to four times the amount of tax evaded. Jail terms may also be imposed."

Source: CNA/aa(aj)

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