07 Aug 2009

Sole Proprietor charged with GST Fraud

by Darren

A sole proprietor in Singapore has been convicted for GST fraud. The defendant was charged for fraudulently claiming GST refunds amounting to $122,182.48 from IRAS - Inland Revenue Authority of Singapore.

The soleproprietor had falsely declared sales and purchases as well as input tax and output tax in the GST returns so as to obtain refunds of GST which he was not entitled to. At a basic level Input tax is the GST paid by the business for purchasing goods and services which will be used by the business. Output tax is the amount of GST chargeable by the business to their clients for sales of goods and services. The amount payable to the IRAS is the net of Output Tax less the input tax. 
IRAS takes a serious view on GST-registered businesses that make false claims for GST refunds or under-charge GST on sales. Any person responsible for making tax declarations should be aware that the IRAS, and any other tax authority for that matter, have strong deterrent measures including prosecution for those who willfully defraud GST. In this case the defendant must pay SDG $366,547.44 (three times the amount of undercharged tax) plus 12 months imprisonment.


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