Tax Evasion Case in Singapore: 61-Year-Old Man Receives 14-Month Sentence

In a significant legal development, a 61-year-old man was sentenced on September 7 to 14 months in prison and ordered to pay over S$1.4 million in penalties for orchestrating a tax evasion scheme involving his son in the luxury watch business. This case marks the first prosecution within Singapore’s pre-owned luxury watch sector.

Involvement in Tax Fraud

Pang Chuan Wah was found guilty of encouraging his son to falsify information submitted to the Inland Revenue Authority of Singapore (IRAS), leading to large understatements of both income and Goods and Services Tax (GST) liabilities. Pang played an active role in the operations of KB Luxury Watch and Jewellery, a business specializing in pre-owned luxury watches.

Although the company was officially registered under his son’s name, Pang managed its day-to-day operations and oversaw tax-related matters. Between the assessment years of 2018 and 2020, Pang directed his son to evade tax responsibilities, resulting in significant discrepancies in individual income tax filings.

Details of the Offense

Pang instigated his son to report understated income figures for the business, which contributed to an undercharging of more than S$350,000 in income tax. This was not only an act of deceit but a violation of the tax laws that IRAS rigorously enforces.

Furthermore, Pang encouraged his son to conceal the company’s obligation to register for GST. By instructing him to claim that business sales were approximately S$920,000, they intentionally avoided crossing the S$1 million threshold that triggers GST registration, despite the company’s actual sales exceeding S$10 million. This manipulation resulted in over S$100,000 in GST liabilities being overlooked from June 1, 2017, to December 30, 2018.

During the accounting period from April 1, 2019, to June 30, 2019, Pang further instructed his son to create false entries in the GST F5 return, leading to an additional undercharging of over S$15,000 in GST.

Government Stance on Tax Evasion

IRAS has made it clear that it does not take tax evasion lightly, emphasizing that offenders can face penalties amounting to up to four times the evaded tax, alongside potential prison sentences. The authority highlighted its commitment to combating non-compliance and ensuring that all businesses adhere to tax regulations.

In its fiscal report for 2025/26, IRAS noted it successfully recovered around S$589 million in taxes and penalties as part of its stringent enforcement efforts.

Conclusion

This case serves as a critical reminder of the legal repercussions of tax fraud and the responsibility businesses have in upholding the law. The tax authority’s rigorous actions reflect a broader commitment to maintaining the integrity of Singapore’s tax system.