Detailing how this may happen, the agency said family members double-hatting as bookkeepers may result in sales and expenses not being properly recorded. Payment from clients – typically cash from contributions collected from family and friends – similarly may not be documented.
IRAS has also prosecuted one religious practitioner since 2019.
Among the potential offences such service providers may commit is sometimes omitting the declaration of income from hongbao – or goodwill – money when it should be declared as employment income, IRAS said.
GOING DIGITAL
IRAS is encouraging companies in the funeral sector to go digital to prevent themselves from falling afoul of the law.
One business that has already made the switch is Ang Yew Seng Funeral Parlour, which now opts for online bank transfers and QR code payments.
The firm has also started using digital software which can be used to create invoices on the go, which has improved efficiency, said the firm’s funeral director Ang Jia Jia.
The company also engaged a third-party accounting firm.
“They help us with preparing the financial statements at year-end and as well as tax-reporting,” she said,
Ms Ang added that the accountants she engages also update her company on new rules, allowing the firm to keep up with the latest standards and ensure compliance.
“We also wanted to maintain a positive business reputation as well (so) we will have a good relationship with customers (and) suppliers,” she said.
Ms Ang, who has been in the family-run business for more than a decade, said the industry is slowly moving away from cash payments, partly prompted by the COVID-19 pandemic two years ago, when in-person contact had to be reduced.
