*This content was translated by AI.
- Accounting lawyers and other related legal professionals..a warning of the possibility of intentional tax evasion
While actor and singer Cha Eun-woo is accused of tax evasion worth 20 billion won, various legal experts are also analyzing and giving opinions. How is Cha Eun-woo's tax evasion different from that of other celebrities. What kind of punishment will he get.
Kim Myung-kyu, a lawyer specializing in accounting, posted an analysis of Cha Eun-woo's alleged tax evasion on his personal account on the 25th. He said, "Actors set up a lot of 'one-person agencies' to reduce taxes." I only want to pay corporate tax (10-20%) instead of income tax (45%). But for a corporation to be recognized, it must be a real company. There are employees, and there should be an office. Cha Eun-woo made his family name, and the office was set up as a house where his parents lived or lived. The IRS said, "This is a shell? "It's just an actor who earned it?" That's why I canceled the corporate tax benefits and threw an income tax bomb," he said. "Saving taxes, everyone wants to do it. However, I don't want to spend the cost of having "the substance of the business (employee, office operation, etc.), and if I try to skip tax benefits, that's what "tax evasion" is. He explained, "I don't want to spend money, but I want to receive benefits." This greed has returned to a huge boomerang of 20 billion won.
Cha Eun-woo's tax evasion is different from the previously controversial actors Lee Ha-nee and Yoo Jun-sang, explaining, "To start with the conclusion, the weight of the charges (weight) is a different fight." While the previous cases of Lee Ha-nee and others could be disputed over "the interpretation of the tax law is a bit different?" Cha Eun-woo's case is a case of suspected criminal charges of "making up and deceiving." In particular, he cited the fact that he changed his legal entity from a corporation that was in good condition to a limited liability company (LLC). He said, "The reason is simple. This is to avoid external audits. When sales or assets grow, a corporation is obligated to be audited by an external accountant and disclose its books, but limited liability companies are not obligated to undergo external audits no matter how much money they make. The National Tax Service suspects it as a 'deliberate cover-up' because it is clear that it switched to a 'blind mode' with the intention of 'not wanting to show my ledger to others,' he said.
He said, "If the investigation does not prove 'intentional' in the case of Cha Eun-woo, there is also a possibility that it will end up as a simple additional collection. It's still in the 'suspect' stage. But the trail is too clear. The traces of "precise design" are too specific, he said. "Change to a limited liability company and wash the address (corporate registration at Ganghwa Island Eel Restaurant instead of Gangnam) are not simple mistakes, but they are seen as "organized and planned settings" involving experts. The core of this case is not "how much more tax should I pay," but "whether the intentionality of concealment is proven." If these designs are recognized as intentional tax evasion, they can lead to all-time fines as well as prosecution charges. Now, the line between simple tax savings and tax evasion is breaking down," he claimed.
Earlier, the Seoul Regional Tax Office conducted a high-intensity tax investigation against Cha Eun-woo in the first half of 2025 and notified him of the additional income tax of more than 20 billion won. This is the highest amount ever imposed on celebrities. The National Tax Service said Cha Eun-woo and his mother, identified only by his surname Choi, used a trick to reduce income tax, which reached 45%, to apply a corporate tax rate that is more than 20% lower than the income tax rate by using a non-substantial company, DANI.
Under the current law, if the Act on Aggravated Punishment of Specific Crimes is applied, a portal tax of 1 billion won or more can be sentenced to life imprisonment or five years or more. However, if it is concluded as an underreporting due to differences in tax law interpretation or is defined as tax avoidance, it will be exempt from criminal punishment other than moral responsibility and tax collection.
Cha Eun-woo's agency Fantagio said in an official statement on the 22nd, "The main issue is whether the corporation established by Cha Eun-woo's mother is subject to real taxation. It is not a final and final issue, he said. "We will actively clarify issues related to the application of legal interpretation in accordance with due process."
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*This content was translated by AI.
