SINGAPORE — A director of a silk printing company, who under-declared more than $866,000 in income, used some of the money to service his loans for a HDB unit and make downpayments for a car and a condominium.
Loh Chia Wei, 47, was jailed for nine months on Monday (20 June) and ordered to pay penalties of $253,195 after he pleaded guilty to tax evasion, money laundering and cheating. His firm Print Orient was fined $20,000 and ordered to pay a penalty of $174,678.93 to the Inland Revenue of Singapore (IRAS).
For over six years, Loh avoided paying $172,509.84 in corporate income tax and Goods and Services Tax (GST).
Loh had been running Print Orient since joining the company as a director on 10 April 2007. Print Orient had been registered under the GST Act since 14 May 2007.
From 2011 to 2016, Loh conducted cash sales on behalf of Print Orient and failed to account for them in both the income tax and the GST returns of Print Orient in order to evade tax.
While the firm’s sales were recorded in its accounting software, Loh recorded cash sales in a separate folder. He did not give the company accountant access to the folder. The accountant did not take into account these cash sales when preparing the income tax and GST returns of Print Orient.
Loh under-declared income amounting to about $866,432.54. He deposited $715,552.59 into his OCBC bank account, with $101,830.24 constituting the benefits of his criminal conduct as it was money that should have been paid as taxes.
Loh used more than $400,000 of the sum he deposited to pay for his personal items.
In 2017, Loh made three repayments totalling more than $267,500 for loan for a flat at 21 Joo Seng Road to the Housing Development Board. He also made a down payment of $78,428 for a Toyota Harrier and $54,855.85 for a unit at Kingsford Waterway condominium.
Apart from the tax offences, Loh attempted to cheat Maybank in order to secure a loan.
In May 2013, Loh decided that one of Print Orient's existing loans needed to be refinanced as the firm was in some financial trouble. The firm’s accountant suggested that adjustments be made to Print Orient’s stock inventories to “make the profits look nicer” before applying to refinance the loan.
Loh then instructed the accountant to adjust profit figures for the year ended on 31 October 2012. The accountant amended the figure from $10,521 to $80,054 and the report was sent to Maybank. Maybank ultimately did not rely on the altered report.
Those convicted of tax evasion under the GST Act may be jailed for up to seven years and/or fined up to $10,000. Under the Income Tax Act, offenders can be jailed for up to three years and/or fined up to $10,000. Tax evaders also have to pay a penalty of three times the amount of tax undercharged.
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