Authorities checking on property agents who evade stamp duty

Channel NewsAsia understands authorities are conducting spot checks on at least seven property developers to find out if they have backdated their documents.

It has been about a week since the latest round of property cooling measures kicked in.

Among the changes is an increase in Additional Buyer’s Stamp Duty of five to seven percentage points across the board.

In a bid to help buyers avoid paying the additional stamp duty, industry insiders said some agents have resorted to backdating the date of the Option-to-Purchase for sale and purchase of residential properties.

Avoiding stamp duty is as good as tax evasion, which is an offence.

Industry insiders said authorities have stepped up efforts to conduct spot checks on possible offenders.

So far, industry insiders said one property agent has been caught backdating.

Authorities have also issued circulars to remind developers and agents to comply with the new cooling measures.

Industry players said that they had previously heard of agents trying to backdate options two to three days after cooling measures were introduced.

But as the measures introduced this round are more drastic, they said there are more agents taking the risk.

In some cases, the buyers may be considering whether to buy a property, and the cooling measures could have been introduced before they could decide.

Industry insiders say that is when they may request their agent to backdate their options.

Chris Koh, director of Chris International said: “If you backdate the document, it will probably be on a gentleman agreement, whereby all parties agree to it. But then who knows as you move down the line, one may play the other out, or one may just say ‘I choose not to buy or sell anymore, and what we did previously was not the right thing to do’. And therefore they use that as a means to get out of the contract.”

Any person guilty of such an offence shall be liable on conviction to a fine of up to S$10,000 or imprisonment of up to three years or to both.

Estate agents or salespersons found involved may face disciplinary action by the Council for Estate Agencies, which could include a financial penalty of up to $75,000 and a suspension or revocation of their licence or registration.

Source : Channel NewsAsia – 18 Jan 2013

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