Simpler form cuts down corporate tax filing errors: Iras

PHOTO: Simpler form cuts down corporate tax filing errors: Iras

A simpler tax form for small firms has reduced the number of incorrect returns filed last year, the taxman said on Wednesday.

About 15 per cent of the tax forms filed across all business made errors last year, down from 17.5 per cent in 2011.

The three-page form was introduced in April last year for companies with revenue of under $1 million, among other criteria.

It replaced a seven-page form they had to complete and which larger firms continue to use.

The Inland Revenue Authority of Singapore (Iras) also provided an online version of the simplified form so firms could file returns via the Internet.

"The chief benefit of e-filing is that it provides better service to our taxpayers by significantly reducing errors and the need for further clarifications," Mr Wilson Ong, assistant commissioner of the corporate tax division, told The Straits Times.

"It is a win-win arrangement for companies and Iras alike as it reduces the time, resources and effort needed to verify taxes."

Iras data showed that the error rate for firms that e-filed was 5.5 per cent last year, way below the overall average of 15 per cent.

"The most common types of errors made by firms which filed their taxes by mail are incomplete forms or those with inconsistent information, so the sums do not add up," said Mr Ong.

Ms Neo Ai Lin, director of ACCV Accounting Services, said: "The instant acknowledgement on e-submissions helps reassure tax agents and clients that the forms have been filed successfully."

Iras hopes that the number of firms that e-file will double this year from the 14,000 that did so last year.

Corporate tax filings are due on Nov 30 but firms that file online will have until Dec 15.

The simplified form was also introduced to encourage more firms to file their taxes by the deadline but the rate of timely filing has stayed flat at 81 per cent over the past two years.

Firms that fail to file by the deadline are usually newly incorporated companies or those that claim to be "dormant" or loss-making.

"The figure may have been flat because it's the first year since the new form was introduced, and some companies may have their reservations," said Mr Ong.

"We are hoping to get on-time tax filings to levels above 90 per cent."

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