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SINGAPORE: A 61-year-old man was sentenced on Monday (Sep 7) to 14 months\u2019 jail and ordered to pay a penalty of more than S$1.4 million for instigating his son to evade taxes on a luxury watch business.<\/span><\/p>\n Pang Chuan Wah had instigated his son to provide false information to the Inland Revenue Authority of Singapore (IRAS), resulting in a significant under-declaration of income and Goods and Services Tax (GST) liabilities.<\/span><\/p>\n This is the first prosecution involving a business in the pre-owned luxury watch industry.<\/span><\/p>\n Pang was involved in the operations of KB Luxury Watch and Jewellery, a pre-owned luxury watch business.\u00a0<\/span><\/p>\n Though the company was under the sole proprietorship of his son, Pang managed and directed the business\u2019 operations and tax matters.<\/span><\/p>\n For the years of assessment 2018 to 2020, Pang instigated his son to evade tax and make false entries in his individual income tax returns. He also provided his son with understated income figures for the business, which were entered and stated in the returns.<\/span><\/p>\n This resulted in the undercharging of over S$350,000 in income tax.<\/span><\/p>\n Pang also instigated his son to commit tax fraud by deliberately concealing his liability to register for GST.\u00a0<\/span><\/p>\n Pang instructed his son to state that the sales of the business were around S$920,000 – under the S$1 million threshold to be liable for GST – despite the actual sales exceeding S$10 million.<\/span><\/p>\n This resulted in more than S$100,000 in GST being undercharged from Jun 1, 2017, to Dec 30, 2018.<\/span><\/p>\n For the accounting period from Apr 1, 2019, to Jun 30, 2019, Pang further directed his son to make a false entry in his GST F5 return, resulting in over S$15,000 in GST being undercharged.<\/span><\/p>\n \u201cIRAS takes a serious view of non-compliance and tax evasion. There will be severe penalties for those who wilfully evade tax,\u201d the authority said.<\/span><\/p>\n Offenders may face a penalty of up to four times the amount of tax evaded and jail terms may also be imposed.<\/span><\/p>\n