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Publications and Press Releases :
Press Release
: News Archives
Suspended jail sentence for taxpayer over false
claims of home loan interest
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A taxpayer was convicted today
(July 13) at Kwun Tong Magistrates' Courts on charges of evading
salaries tax and property tax. She was sentenced to three months'
imprisonment, suspended for two years and fined a total of $30,000,
representing 67% of the tax evaded.
Wong Yuen-ping, 45, pleaded guilty
to five charges of evading salaries tax, wilfully, with intent,
by making false statements in connection with claims for deduction
of home loan interest under the Inland Revenue Ordinance (IRO) for
the years of assessment 1998/99 to 2002/03, contrary to section
82(1)(c) of the IRO.
She also pleaded guilty to one charge
of evading property tax, wilfully, with intent, by omitting rental
income, which should have been included in the property tax return
for the year of assessment 2001/02, contrary to section 82(1)(a)
of the IRO.
The court heard that Wong, jointly
with her husband, acquired a property at Noble Place, Tuen Mun in
1998. Wong claimed deductions for home loan interest in respect
of the property in her tax returns for the years of assessment 1998/99
to 2002/03 by making false statements that the property was used
as her place of residence during the years of assessment in question.
In accordance with these false statements, deductions were granted
to Wong in respect of the interest incurred on the mortgage of the
property. Also, in the property tax return issued to the joint owners
of the property for the year of assessment 2001/02, Wong declared
that the property had been left vacant throughout the year.
An investigation by the Inland Revenue
Department (IRD) revealed that Wong and her family, at all material
times, resided at quarters provided to her husband by his employer.
Wong had never resided at the property at any time during the relevant
years of assessment. She in fact rented the property to different
tenants during the material times. Under the IRO, one of the requisite
criteria for claiming a deduction for home loan interest is that
the dwelling is used at any time in the year of assessment by the
claimant exclusively or partly as his/her place of residence. For
the five years of assessment 1998/99 to 2002/03, Wong had falsely
claimed deductions for home loan interest amounting to $315,315.
The total tax undercharged was $38,554.
The investigation also revealed that
Wong let out the property and received rental income during the
years 1998 to 2002. The court was told that Wong omitted the rental
income of $53,000 from the property tax return for the year of assessment
2001/02 and the resultant tax evaded was $6,157.
An IRD spokesman reminded people
that tax evasion was a criminal offence under the IRO. Upon conviction,
the maximum sentence for each charge is three years' imprisonment
and a fine of $50,000, plus a further fine amounting to three times
the amount of tax evaded.
Ends/Thursday, July 13, 2006
Issued at HKT 16:54
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