AFTER 10 years of tax evasion, Teo Kiok Seng, 45, has been slapped with the maximum two-year jail term and a $1.5 million penalty.

The accountant assisted his company, United Team Enterprise (UTE), in evading tax by making false entries in goods and services tax (GST) returns 40 times between 1996 and 2007.

District Judge May Mesenas set the penalty at three times the amount of tax undercharged.

Initially, Teo was a director of UTE, a general wholesale trade company, until he gave up the position in July 2003 to take on the role of accountant.

Investigations by the Inland Revenue Authority of Singapore (Iras) showed that Teo submitted fake input tax claims in UTE's GST returns when the company was dormant.

He falsely declared export figures and purchases with GST incurred to make refund claims when there was no business activity.

GST-registered traders can offset the GST they pay on their purchases, known as input tax, against the GST (output tax) they collect from sales, and pay the difference to Iras in each claim year.

If a business incurs more GST on purchases than it collects from sales, it can claim a refund.

Iras' principal legal officer Quek Hui Ling highlighted aggravating factors in the case such as the long period of fraudulent activity and Teo's deliberate course of conduct.

He could have been fined up to $10,000 or jailed up to seven years or both on each charge, in addition to the penalty.

Another 86 charges were considered during his sentencing.

ELENA CHONG

This article was first published in The Straits Times.