Local promoter of shows and entertainment guilty of under declaring GST

A local promoter of shows and entertainment company was found guilty of under-declaring GST output tax of more than $500,000 recently.

It was stated in the case that the company failed to check the accuracy of the GST Returns filed to IRAS made by its accounting and tax agent.

This case highlights the important point that companies NOT their agents are responsible to ensure the accuracy and timeliness of returns made to IRAS. In order to do so, they should be able to verify the accuracy and reasonableness of the numbers before signing off and submitting the returns to IRAS.

Accounting and tax agents’ duties are to assist companies to prepare and compile the accounts and tax filings, based on the information and details provided to them. What does this mean to companies? Companies need to make sure all business transactions are properly documented with accurate supporting documents. They can no longer give reasons like no receipts, it’s normal in the industry, etc.

Also, companies should be careful in choosing accounting and tax agents. There are many unqualified agents out there who will offer you their services at a very unrealistic low fee. Because of this, some business owners have the mistaken idea that qualified and expert accounting and tax advice can be purchased cheaply!

Therefore, this case is a very good example of how companies can end up on the wrong side of the law if they do not take basic precautions as mentioned above.


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ACRA Cancels Registration of Filing Agent and Qualified Individual for AML/CFT Breaches

The Accounting and Corporate Regulatory Authority (ACRA) had cancelled the registrations of filing agent (RFA) and qualified individual (RQI) on 18 January 2024. The registrations were cancelled in view of breaches of anti-money laundering and countering the financing of terrorism (AML/CFT) controls under the ACRA (Filing Agents and Qualified Individuals) Regulations 2015 (the “ACRA Regulations”).

Some of the basic AMT/CFT controls that a RFA and RQI are required to exercise are as follows:

(a) perform additional customer due diligence measures when a customer is not physically present during onboarding;

(b) inquiring if there exists any beneficial owner in relation to some of its customers; and

(c) perform risk assessments i

RQIs and RFAs provide corporate secretarial services for business entities, such as helping customers to incorporate companies, file annual returns and fulfil other filing requirements under the Companies Act 1967 or other Acts under ACRA’s purview. RQIs and RFAs are required to perform customer due diligence measures in accordance with the ACRA Regulations, and conduct their business in such a manner as to guard against the facilitation of money laundering and the financing of terrorism. RQIs and RFAs must also satisfy statutory requirements such as being fit and proper persons, to be registered or continue to be registered.

RQIs and RFAs who breach their statutory obligations may be subject to enforcement actions, such as financial penalties of up to $10,000 or $25,000 per breach respectively or have their registrations with ACRA suspended or cancelled.

Therefore, RQIs and RFAs play an important role in helping to detect and combat illicit activities.

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