Tag: GST

Output tax left unchecked results in hefty penalty

On By taxsgIn General News

30 December 2011

Due to inaccurate output tax amounts submitted to IRAS in 2005 and 2006, Unusual Entertainment Pte Ltd (“UEPL”) was found guilty of understatement of $502,922.27 in GST, resulting in a penalty of $601,632.72 and a fine of $10,000.

Although there were vide variations in the final tally, sales figures submitted by UEPL vis-a-vis output tax amount submitted for 2005 and 2006 had been left unchecked. For eg. in 2005, the sales revenue in the income tax return was $9,136,361, against the $2,810,668 declared as total sales in their GST returns.

A guilty plea was recorded for four charges of under-declaration of GST without reasonable excuse. Four remaining charges were taken into consideration for sentencing.

Source: This article was extracted from the Inland Revenue Authority of Singapore (IRAS) website. Visit http://www.iras.gov.sg/ for more information.

GST risk management funding receives another $5mil boost

On By taxsgIn Goods and Services Tax, Latest Tax News

11 December 2011

The ‘Assisted Compliance Assurance Programme (ACAP)’, a GST risk management program launched in April 2011 has exceeded its take up rate by more than 60%. IRAS has since announced a further $5 million investment from 1 April 2012.

ACAP provides a set of guidance for GST-registered businesses to undertake a holistic review of the robustness and effectiveness of their internal control system that impacts GST compliance.

GST-registered businesses with ACAP status within a five-year period ie from 5 April 2011 to 4 April 2016 will be entitled to a 50% co-funding of qualifying ACAP fees capped at $50,000 and a one-time waiver of penalties for voluntary disclosures of past GST errors.  Other benefits include three to five years of exemption from GST audits, faster GST refunds, speedier resolution of GST issues and automatic renewal of GST schemes.

The additional $5 million tranche will be allocated in three phases over the next four years. Funding allocated for each phase will be available for applications received during the respective periods until it has been fully taken up. Any balance not taken up will be carried forward to the next phase. Applications received after the funding phase will still be able to enjoy full waiver of penalties for GST errors discovered from the conduct of ACAP and other benefits or choose to defer to the next phase.

Co-funding of qualifying costs incurred is on a reimbursement basis. Successful applicants will be given a cheque within one month from the receipt of the claim form and complete set of supporting documents. IRAS will waive penalties for past GST errors disclosed, regardless of the time period to which the errors relate, subject to specified conditions.

More details can be found at the e-Tax Guide, ‘GST: Assisted Compliance Assurance Programme (ACAP)’.

Source: This article was extracted from the Inland Revenue Authority of Singapore (IRAS) website. Visit www.iras.gov.sg for more information.

Revisions made to GST Guide on Approved Contract Manufacturer and Trader (ACMT) Scheme (7th Edition)

On By taxsgIn Goods and Services Tax, Latest Tax News

3 December 2011

In  his  2011  Budget  Statement,  the  Minister  for  Finance  announced  further enhancements  to the ACMT scheme to ease GST compliance for all industries approved under the ACMT scheme.

At a glance, the enhancements are as follows:

  •  The supply of value-added services to overseas clients relating to failed or excess productions to be disregarded, and
  •  Input tax to be claimable on goods locally purchased by overseas clients and delivered to an ACMT CM for value-added services.

From  1 October  2011,  the  ACMT  scheme  will  also  be  extended  to  certain business segments in the biomedical industry. This is in addition to the semi- conductor and printing industries, which are the current approved  industries under the ACMT scheme.

In this revised edition, changes were made to paragraph 3 whereby the benefits under the GST enhanced Approved Contract Manufacturer and Trader (ACMT) scheme, as well as GST input tax entitlements on any separate supply of raw materials made by ACMT local contract manufacturers (CM) are outlined. These changes will take effect from 1 October 2011 by way of remission, until the GST legislation is amended.

This  e-Tax  guide  also explains  how  the  ACMT  scheme  works,  the  qualifying conditions for the scheme and responsibilities of approved ACMT persons.

For the full e-Tax Guide, please click here.

Source: This article was extracted from the Inland Revenue Authority of Singapore (IRAS) website.

Revised GST Guide issued for the Market Participants in the National Electricity Market of Singapore (“NEMS”) (3rd Edition)

On By taxsgIn Goods and Services Tax, Latest Tax News

3 December 2011

First published in November 2008, the latest edition of the e-Tax Guide, “GST Guide for the Market Participants in the National Electricity Market of Singapore (“NEMS”) (Third Edition)” was, on 28 November 2011 released by IRAS. The revised edition incorporates feedback received from the industry and provides further clarity on the GST treatment applicable to passing of vesting debits/credits and price neutralisation.

The revised e-Tax Guide incorporates changes as follows:

  • Amendments to para 4.4 (Treatment of vesting debits/credits in Vesting Contracts), Appendix 1 (Summary Table on GST Treatment) and Appendix 2 (Numerical illustration of the GST treatment on the supply of electricity in the wholesale market), and
  • New insertion on the treatment of the passing of vesting debits/credits between the Retailers and the Gencos as part of the Contracts for Differences (CfDs) between them being an exempt supply. Hence, the requirement for Retailers and Gencos to report the net gains or losses in their GST returns (para 5.7).

To view the full e-Tax Guide, please click here.

Source: This article was extracted from the Inland Revenue Authority of Singapore (IRAS) website.

Revised GST Guide issued for the Biomedical Industry (2nd Edition)

On By taxsgIn Goods and Services Tax, Latest Tax News

3 December 2011

The GST Guide for the Biomedical Industry (Guide), first released on 1 September 2011, has undergone a revision on 25 November 2011. The revised guide explains the 2011 Budget GST changes which have been designed to ease GST compliance for the biomedical industry.

To recap, the 2011 Budget changes for the biomedical industry provide for the following:

  • GST relief on importation of clinical trial materials (CTMs) into Singapore, and
  • Extension of the enhanced Approved Contract Manufacturer and Trader (ACMT) Scheme to qualifying biomedical contract manufacturers.

In this second edition, para 4.9 of the Guide was amended to explain the benefits under the GST enhanced Approved Contract Manufacturer and Trader (ACMT) scheme, as well as GST input tax entitlements on separate supply of raw materials made by ACMT local contract manufacturers (CM). These changes will take effect from 1 October 2011 by way of remission, until the GST legislation is amended.

This guide also clarifies the GST treatment for other common scenarios and issues in the biomedical industry based on existing GST rules.

For the full e-Tax Guide, please click here.

More about GST for the biomedical industry can be found here.

Source: This article was extracted from the Inland Revenue Authority of Singapore (IRAS) website.