Penalties associated with corporate tax in Singapore

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There are 3 situations under which penalties can be imposed on a company:

1. Inaccurate filing of tax

If the IRAS finds that a company has unintentionally filed false tax documents, it can do the following:

• Impose a fine of up to S$5,000

• Charge 200% of the tax undercharged as a penalty

• And/or a jail term of a maximum of 3 years

2. Late payment of tax

Late payment of corporate tax will lead to a 5% penalty. Further delay will result in an addition of 1% for every following month until the company clears its dues.

It is within IRAS's authority to take further legal or enforcement actions to recover the taxes.

3. Tax evasion

Tax evasion occurs when an individual or a company furnishes incomplete or inaccurate data to reduce their tax liability, obtain a refund or gain ineligible tax credit. This is a serious criminal offense and miscreants could face the below consequences:

• Stiff penalties of up to 400% of the undercharged tax

• Fines that can go up to S$50,000

• And/or jail term for a period of up to 7 years

Given the severity of the punishments, it is strongly advised to seek the help of a professional tax advisor at Allied Services to help you file taxes on time and accurately.