Tax season may not be the most exciting time of the year, but it’s undoubtedly one of the most critical for businesses.
Tax filing can be a daunting task for any company, especially in Singapore where the tax rules and regulations are constantly changing. If you make a mistake in your tax filing, you may face penalties, fines, or even legal actions from the Inland Revenue Authority of Singapore (IRAS).
To help you avoid these unpleasant consequences, we have compiled a list of 5 common company tax filing mistakes that you should watch out for and how you can solve them with HRMLabs payroll software.
Common company tax filing mistakes
Here are some common tax filing errors businesses often make.
1. Missing the tax filing deadline
One of the most common and costly mistakes that companies make is missing the tax filing deadline. The deadline for filing the corporate income tax return (Form C-S or C) is 30 November for paper filing and 15 December for e-filing. If you fail to file your tax return by the deadline, you may be subject to a late filing penalty of up to $1,000 and an estimated Notice of Assessment (NOA) by IRAS.
2. Not claiming all the tax deductions and incentives
Another common mistake that companies make is not claiming all the tax deductions and incentives that they are entitled to. There are many tax deductions and incentives available for companies in Singapore, such as the Productivity and Innovation Credit (PIC) scheme, the Corporate Income Tax (CIT) rebate, the Wage Credit Scheme (WCS), and the Startup Tax Exemption (SUTE) scheme. These tax deductions and incentives can help you reduce your taxable income and increase your cash flow.
3. Not keeping proper records and documents
Another common mistake that companies make is not keeping proper records and documents for tax purposes. According to IRAS, companies are required to keep proper records and documents for at least five years from the end of the relevant financial year. These records and documents include invoices, receipts, vouchers, contracts, bank statements, accounting records, payroll records, etc. If you fail to keep proper records and documents, you may face difficulties in filing your tax return, verifying your income and expenses, or responding to queries or audits from IRAS.
4. Not reconciling your accounts
Another common mistake that companies make is not reconciling their accounts before filing their tax return. Reconciling your accounts means checking that your accounting records match with your bank statements, invoices, receipts, etc. This is important to ensure that there are no errors or discrepancies in your accounts that may affect your tax filing. If you do not reconcile your accounts, you may end up reporting inaccurate or incomplete information to IRAS, which may result in penalties, fines, or adjustments.
5. Not updating your business information
Another common mistake that companies make is not updating their business information with IRAS when there are any changes. For example, if you change your business name, address, contact details, bank account details, etc., you need to inform IRAS as soon as possible. This is important to ensure that IRAS has the correct information about your company and can communicate with you effectively. If you do not update your business information with IRAS, you may miss out on important notices or correspondence from IRAS, which may affect your tax filing or assessment.
How HRMLabs Payroll Software can help you
As you can see, filing your company tax return can be a complex and time-consuming process. But it doesn’t have to be. With HRMLabs payroll software, you can simplify and automate your payroll and tax compliance. HRMLabs payroll software can help you:
- Enabling users to generate and submit Form C-S or C online through the IRAS portal.
- Tracking and recording of eligible expenses and income for tax purposes.
- Storing and managing all necessary records and documents.
- Generating reconciliation reports that highlight any disparities between accounting records and other financial sources.
- Updating business information through the IRAS portal.
With HRMLabs payroll software, you can save time, money, and hassle on your payroll and tax filing. You can also focus more on growing your business and less on worrying about tax mistakes.