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| Iras Singapore |
IRAS said with the new programme, companies can expect cost savings of up to S$150,000 dollars.
SingTel and Cold Storage are among the first few companies that have signed-up for the new programme. And shipping company Bengal Tiger Line is confident of achieving Assisted Compliance Assurance Programme (ACAP) status within the next three months.
IRAS said by achieving that status, companies will not have to go through GST audits for three to five years.
Joachim von der Heydt, Chairman of Bengal Tiger Line, said: "Yes, shorter time spent and then of course more transparency for the tax authorities and for ourselves, in a way that we don't waste too much time with the control, and that is our main target, because our company is a lean company."
This is in line with what IRAS is hoping to achieve - having senior management take an active role in GST risk management.
Chia-Tern Huey Min, Deputy Commissioner of GST & Property with IRAS, said: "It means that senior management will appoint a person responsible to look at GST risk management, so the company will put in place a controlled framework and the processes and procedures in place to ensure that any GST risk will be addressed."
Observers said companies can see some indirect cost savings too.
Lam Kok Sheng, Partner and Head of Indirect Tax at KPMG, said: "What Inland Revenue is saying is that look if you get it right, I will not audit you for three to five years. Audits can be quite disruptive to businesses so three to five years step down in audit activities and also in terms of total waiver of penalties for any GST errors which are uncovered during this process...this goes a long way towards helping businesses to save cost."
To join the scheme, IRAS will co-fund 50 per cent of the application fees, up to a cap of S$50,000 per applicant, and has set aside S$5 million over a five-year period for this.
Taken together with the one-time waiver for past GST errors disclosed voluntarily in the course of the ACAP review, IRAS said companies can potentially save up to S$150,000. Other benefits in achieving ACAP status, is an auto-renewal of a firm's existing GST schemes when they expire.
Meanwhile, observers said application fees will likely range from S$50,000 to S$100,000, but there is no hard and fast rule, as cost will depend on the business units of the businesses and the amount of paperwork that they pass on to consultancy firms, like KPMG, to do.
To apply, businesses can go to the IRAS website to fill in a check-list form.
Consultancy firms said if businesses meet 60 per cent of the requirements, they should be eligible to apply for the ACAP status.
IRAS said it hopes 100 businesses will join the new programme within the next few years. It added that from SMEs to large conglomerates, there is no limit to the size of the companies applying for the programme.
Sources: http://www.channelnewsasia.com
