Jail for company director who evaded S$172,000 in taxes and spent ill-gotten gains on new flat and car

SINGAPORE — For six years, the director of a silk printing company avoided paying about S$172,000 in income tax and goods and services tax (GST) by hiding cash sales to the company’s accountant.

Loh Chia Wei then used the money for a down payment on a condominium apartment in Upper Serangoon and a Toyota Harrier vehicle, among other things.

On Monday June 20, Loh, 48, was jailed for nine months and must pay a fine of around S$253,000.

He still has to serve 16 weeks behind bars if he is unable to pay the fine.

His company, Print Orient, was fined S$20,000 and fined approximately S$174,000 to the Inland Revenue Authority of Singapore. Loh had been in charge of running the business since joining in 2007.

He pleaded guilty to:

  • Ten counts under the Income Tax Act and GST Act for evasion of approximately S$77,000
  • One count of money laundering under the Corruption, Drug Trafficking and Other Serious Crimes (Forfeiture of Benefits) Act
  • An accusation of attempted cheating

22 other similar charges were considered for sentencing.

The court heard that from 2011 to 2016, Loh made cash sales on behalf of the company and did not account for them in his tax and GST returns.

He recorded cash sales in a separate folder in his accounting software and deliberately barred the company’s accountant from accessing it.

In total, Loh under-declared income amounting to approximately S$866,000. Of this amount, S$715,000 was deposited into his OCBC bank account, of which S$101,830 was the benefits of his criminal conduct as they should have been paid as taxes.

From July to December 2017, Loh made repayments for his Housing and Development Board flat along Joo Seng Road, a S$54,000 down payment for an apartment in the Kingsford Waterbay Condominium and a S$78,000 down payment. Singapore dollars for the Toyota Harrier.

Separately, in May 2013, he wanted to refinance one of the company’s existing loans because the company was having financial difficulties.

Loh consulted with accountant Yong Mee Kiang, who suggested adjustments be made to the company’s inventory to “make profits more attractive” before seeking refinancing.

Loh agreed and asked the accountant to adjust the company’s profit figures in his management accounts for the year ended October 2012.

Mr. Yong later amended the MD&A to reflect a total profit of S$80,054 instead of S$10,521.

Loh submitted the amended profit figures to Maybank along with a term loan application form in August 2013 requesting two loans totaling S$735,000.

Maybank ultimately did not rely on this to approve the loan request.

Court documents do not specify how his various offenses came to light.

Those convicted of tax evasion under the GST Act can be imprisoned for up to seven years or fined up to S$10,000, or both.

Under the Income Tax Act, offenders can be jailed for up to three years or fined up to S$10,000, or both, for each offence.

Tax evaders must also pay a penalty of three times the amount of tax they admit to undercharging.