Additional tax penalty

In the Case No. D25/11;14 September 2011, the Board re-stated the principles and guidance on imposing
additional tax as penalty:
The primary objective of additional tax penalty was to penalize the infringing taxpayers and to deter the
infringing taxpayers or other taxpayers from infringing. The same principles applied in determining penalty
for lateness in informing the Commissioner of the chargeability to tax and submitting tax returns.
The principles adopted by the Board in determining lateness in submitting tax return could be summarized
as follows (not being an exhaustive list):
(1) negligence or recklessness in submitting the tax return was inexcusable;
(2) deliberate tax evasion was a serious crime and an aggravating factor to imposing additional tax penalty.
Unintentional tax evasion was not a reasonable excuse, nor was it a mitigating factor;
(3) paying tax punctually was a responsibility of a taxpayer, and was not a relevant factor in considering
additional tax;
(4) the fact that the IRD discovered the infringement was not a mitigating factor. The fact that there was no
actual loss suffered by the IRD in low penalty percentage cases was not a mitigating factor. The fact that
there was tax undercharging or late charging of tax as a result of the infringement was an aggravating
(5) the burden of proof and the burden of persuasion of impecuniosities or inability to afford additional tax
penalty lied on the taxpayer;
(6) where an infringement was proven, it was unrealistic to ask for total exemption of tax penalty, which
only showed that the taxpayer was still unaware of the
responsibility to submit detailed and accurate tax information punctually;
(7) cooperation with the IRD was a mitigating factor;
(8) adopting effective measures to prevent further infringement was an important mitigating factor. To the
contrary, pointlessly blaming on the IRD or others was an aggravating factor;
(9) subsequent infringement was an aggravating factor;
(10) publicly infringing would be heavily penalized;
(11) if the Board was of the view that the penalty was excessive, the penalty would be reduced;
(12) if the Board was of the view that the penalty was insufficient, the penalty would be increased;
(13) if the Board was of the view that the appeal was frivolous, vexatious or an abuse of the appeal
process, the Board might order the appellant to pay costs of the Board.

Zircon - This is a contributing Drupal Theme
Design by WeebPal.