Mistakes in Filing GST Returns Companies Should Avoid
Goods and Services Tax or commonly known as GST is one of the leading contributors to tax revenues in Singapore. For 2009/2010, GST total amount collected was $6.9 billion and another $154 M in taxes and penalties through GST audit by the IRAS or Inland Revenue Authority of Singapore.
Tax penalties may hurt your business especially when you know that you could have avoided these errors. Here are some common errors that companies make in filing GST returns:
- Omission of festive gifts such as moon cakes and bouquets, dinner & dance prizes, free use of the assets of company for personal purposes;
- Charging GST at standard rate of 7% to the local consumers when services rendered could have been zero-rated;
- GST claims on the invoice of the customer in foreign currency based on in-house exchange rate;
- Exclusion of the 7% on the disposal of fixed assets or trade-in of assets in Singapore;
- Charging international consumers zero-rate GST when the services rendered could have been standard-rated;
- Reporting of taxable supplies without supporting export documents for samples, items returned, international repair and loan of equipment, consignment, etc as zero-rated items in GST returns;
- Increasing taxable purchases by 7% just to attain the GST input-tax amount;
- Absence of attribution of input tax incurred for exemption of items/supplies or non-business events/activities.
The best way to avoid penalties due to errors in filing of GST tax returns, the company should adhere religiously to regulations set by the government. The government is willing to assist companies and businessmen registered in GST in providing them with information regarding the filing of GST returns.
In Corpworldbiz, we help our clients in filing GST returns. Should you have any queries in regards to GST, feel free to contact us today.