A Singaporean mother and son have been sentenced to two weeks in jail for deceiving the Inland Revenue Authority of Singapore (IRAS) to avoid paying stamp duty. The case marks the first prosecution of its kind since authorities highlighted the prevalence of tax avoidance schemes involving the '99-to-1' arrangement.
A mother and son duo in Singapore have been sentenced to two weeks in jail for deceiving the Inland Revenue Authority of Singapore (IRAS) to evade a substantial amount of stamp duty . This marks the first prosecution of its kind since authorities highlighted the prevalence of such tax avoidance schemes.
Deputy Prime Minister Lawrence Wong explained in May 2024 that the “99-to-1” arrangement, a common tactic among property buyers, is designed to minimize the Additional Buyer’s Stamp Duty (ABSD) payable. Ng Chiew Yen, 56, and her son, Keith Tan Kai Wen, 26, admitted to two counts each of providing false and misleading information to IRAS. Three additional charges were taken into consideration during their sentencing. In April 2023, Senior Minister of State for Finance Chee Hong Tat revealed to Parliament that less than 1% of private residential property transactions involved schemes like the “99-to-1” arrangement. IRAS reported 166 such cases the previous year. The government implemented the ABSD increase in 2018 as a measure to cool the property market, which was experiencing an en-bloc frenzy. The ABSD for citizens purchasing second and subsequent homes was raised to 12%. In September 2021, Tan purchased a condominium unit at 49 Canberra Drive for S$1,113,000 under his own name. However, he lacked the financial means to secure the unit independently. Unable to obtain a bank loan due to his unemployment at the time, Tan's mother was required to be a legal mortgagor. To circumvent paying the full ABSD on the property, three days after the purchase, Tan sold his mother a 1% share for S$11,130. As she already owned a property, she was only liable for ABSD on this 1% share. The transaction was subsequently audited by IRAS to verify the accurate payment of ABSD. During the investigation, it was discovered that the mother and son had lied and deleted messages with their banker, even after receiving warnings about the legal consequences of their actions
Singapore Tax Evasion Stamp Duty Inland Revenue Authority Of Singapore (IRAS) 99-To-1 Arrangement Property Jail Sentence
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