The tax investigation is one of the most important aspects for the tax services and for the State given the budget revenues attached to tax investigations, but not only. In this regard, it turns out that the tax administration is extremely efficient and particularly efficient since with equal staff, the yield of the tax investigation reached almost 20 billion euros in rights and penalties in 2021.
These good figures for the tax administration are not an isolated fact since for 10 years the yield of the tax investigation has constantly increased by around 7 to 8% from one year to the next (except in 2016), even though the growth rate of the French economy over the same period was on average less than 2%.
Corporate secretarial firms help provide tax investigation services, which involves helping firms prepare, audit and interview key personnel to help them get through the tax investigation process in a speedy, efficient and effective way.
What are the objectives of the tax investigation?
The mission and objectives of tax inspectors have a dual aspect, namely a preventive mission, but also a repressive purpose. The preventive dimension aims to “invite” taxpayers to respect their tax obligations. The repressive dimension of tax investigations aims to punish breaches committed by taxpayers. Such a precedent is important in making sure a country’s corporate landscape is healthy and free of corruption.
What are the criteria that trigger a tax investigation?
In Singapore, when it comes to tax investigation for companies, the chances of companies being brought up for a GST audit or tax investigation is purely random. When you are involved in a tax investigation it does not mean that you or your company are in trouble.
However, a tax investigation does aim to uncover any lapse in paperwork, abuse of corporate assets, money laundering orattempt in tax fraud. Singapore’s economy is small and open. Having multiple untamed companies run afoul and abusing Singapore’s tax system could cripple Singapore’s economy.
It could pollute the corporate and political landscape to the point of no recovery. Hence, Singapore has always had a no-tolerance attitude towards breaches in corporate law, such as misappropriate of funds and tax evasion attempts.