Under the Wage Credit Scheme (“WCS“), the Singapore government co-funded 20% to 40% of wage increases given to Singapore Citizen employees earning a gross monthly wage of $4,000 and below between 2013 and 2017.
Recently, IRAS has revealed that in a random audit, over 1000 employers have been caught cheating on their WCS claims. These fraudulent schemes included hiring phantom employees and inflating wage increases.
It is well worth remembering that WCS fraud is a criminal offence, and offenders face up to 10 years’ imprisonment and a fine. In a recent case, a businessman was jailed for 5 weeks for defrauding IRAS of $66,678.40 in WCS claims.
In addition, company directors who are convicted of WCS fraud could risk disqualification and removal from office.
IRAS’s enforcement actions show that businesses would do well to stay away from contrivances which attempt to cheat the taxman.
