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PRESS RELEASE

(Source : Information Services Department)

Suspended jail sentence for taxpayer convicted of falsely claiming deduction of expenses of self-education

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     A taxpayer was convicted yesterday (April 16) at the Kwun Tong Magistrates' Courts on five charges of evading salaries tax. She was sentenced today (April 17) to two months' imprisonment, suspended for two years, and fined $5,000 for each charge, making a total fine of $25,000.

    The defendant, aged 47, is a nurse at a private hospital. She pleaded guilty to five counts of evading tax, wilfully with intent, by making false statements in connection with claims for deduction of expenses of self-education in her tax returns for the years of assessment 2006-07 to 2010-11, contrary to section 82(1)(c) of the Inland Revenue Ordinance (Cap. 112) (IRO).

    The court heard that in each of her tax returns for the years of assessment 2006-07 to 2010-11, the defendant claimed deduction of expenses of self-education above the statutory ceiling. An investigation by the Inland Revenue Department (IRD) revealed that the defendant failed to produce any details or evidence in support of her claims for deduction of expenses of self-education. The total of the false deduction claims for the five years was $297,740 and the total tax evaded was $45,994.

    This is the first prosecution case on false claims for deduction of expenses of self-education. The IRO provides that expenses of self-education paid for prescribed courses or examination fees paid to specified education providers or associations are tax deductible. Documentary evidence in support of deduction claims should be retained for seven years. The IRD will conduct checks on deduction claims. Taxpayers will be asked to produce supporting documents when their cases are selected for audit.

    A spokesman for the IRD reminded taxpayers that tax evasion is a criminal offence under the IRO. Upon conviction, the maximum penalty for each charge is three years' imprisonment and a fine of $50,000 plus a further fine of three times the amount of tax evaded.

Ends/Thursday, April 17, 2014
Issued at HKT 15:25

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