I used to argue like the above, stating tat giving salary to
people doing nothing is tax evasion.
The reply I got from IRAS is tat the profit from the company is
still register as the one before u give the salary to the people.
Tis is because they r not considered to be directly involved in the
production and business and therefore it is not tax dedeuctable.
Tat means u still have to pay the same business tax. If u pay
lesser, then if they find out from the accounts and find evidence u
did the above, then u have committed tax evasion
However if u r willing to pay the business tax, and wanted to
employ imaginary people to offset the local to foreigner ratio,
then it is not illegal from IRAS.
Of course, u can lie or claim tat the people u employed r all
actually working for the company by just registering their name or
something. If u wanna be dishonest, there r a million and one
things u can do to reduce tax. U can claim the person is on long
term MC, or claim he works and pull in business, or claim he is
there to listen to imaginary phone calls, or claim many many
incredible stuffs. If the gov found out, they can prosecute.
Then tis become a case for lawyers between both parties to fight
the case whether r they relevant or non relevant to the work
generated, cheating or not cheating, and see wat the judges decide.
The way I phrase the letter is equivalent to how law stated
examples for people to understand the law. It is simple and
straight forward with the necessary ingredients which i wanted to
include.
Please don't insult me by associating me with you.
First of all, you went through all the mumbo jumbo and didn't
even answer my simple question. Or you don't know the answer?
If a businessman wants to avoid paying tax, surely he won't be
STUPID like you and tell IRAS what you just did in the query.
Whether it's legal or legal rest with the ability of the tax
accountant. If he employs staff to do nothing, surely he won't be
stupid to tell the IRAS that they are doing nothing. If all the
paper work is proper, there should be no questions about it's
legality.
If the government finds out they can prosecute? You mean if I
decide to pay my secretary $10,000 a month to make one cup of
coffee during that one month, it is wrong. It's up to me to decide
the job scope of my employees, if I so decide to pay $10,000 for my
secretary to make me 1 cup of coffee, or sit around the office to
do nothing for 1 minute, it's entirely my choice. IRAS can't
dispute the salary I pay her. Funny how you claim that IRAS can
claim it's illegal for me to pay what I choose to pay to my
employees.
The way you phrased your query is to admit full guilt, it's not
from the perspective of a businessman with tax avoidance on his
agenda. Afterall, your point of contention is from the perspective
of a businessman wanting to avoid tax, not from a
halfwit claiming full responsibility of a crime when the
verdict of guilt is straddled atop the fence.
Why not send it the letter of query written by me, see if it's
legal.