Consultancy owner fined for lying about business activities to get cash payout
TODAY file photo
SINGAPORE — A business and consultancy owner has been ordered to pay a penalty of S$118,665.60 and a fine of S$4,500 for giving false information to the Comptroller of Income Tax in order to get a Productivity and Innovation Credit (PIC) cash payout for his business.
In default of paying the penalty and fine, K H Raja Mohamad Maiden will face 16 weeks and two weeks of imprisonment, respectively.
The 52-year-old had submitted an application for the credit payout on April 8, 2013, following which he incorporated and registered his business, Qaizar Consultancy, with the Accounting and Corporate Regulatory Authority (Acra) two days later.
In registering with Acra, Raja Mohamad had backdated his consultancy’s business commencement date to Oct 20, 2012, to qualify for the PIC claim for the relevant financial period between Oct 12, 2012, and Dec 31, 2012.
Investigations also revealed that Raja Mohamad had not conducted any business under his consultancy even though he had stated a revenue of S$80,000 in the PIC cash payout application form.
Raja Mohamad had also stated an incurred qualifying expenditure of S$98,888, which was purportedly for a software purchase.
Although the software purchase agreement and the purchase invoice was dated Dec 17, 2012, Raja Mohamad had signed the agreement and invoice only in early April 2013, around the same time that he had registered his consultancy with Acra.
As such, the software purchase was not within the relevant financial period.
Raja Mohamad had also agreed with the software vendor to backdate the PIC claim application even when the business, employees and the expenditure were not in existence during the relevant financial period.
Raja Mohamad was also found to have made a Central Provident Fund (CPF) online application for submissions of contributions to three local employees, who did not carry out any work for the consultancy, in May 2013.
He had admitted to backdating payments to CPF to qualify for the PIC cash payout.
The offence was detected when the accused’s application for the PIC cash payout was selected for review, resulting in no cash payout to him.
In a statement, the Inland Revenue Authority of Singapore said it takes a serious view of any attempts by claimants or vendors to defraud the Government.
Offenders convicted of PIC abuse will have to pay a penalty of up to four times the amount of PIC cash payout fraudulently obtained, or which would have been obtained if the offence had not been detected.
They can also be fined up to $50,000, or jailed up to five years, or both.
