*This content was translated by AI.
While singer and actor Cha Eun-woo is embroiled in allegations of income tax evasion worth 20 billion won, analysts say he may have planned a big picture with real estate investment in mind.
Lawyer Kim Myung-kyu recently appeared on the YouTube channel "Nalidge Studio" and analyzed Cha Eun-woo's alleged evasion of 20 billion won.
Regarding the corporation A established by Cha Eun-woo's mother, lawyer Kim said, "The fact that it was originally a corporation but changed to a limited liability company itself is not a problem," adding, "We need to look at the overall structure. (Cha Eun-woo's agency) Fantagio gave outsourcing services (to corporation A), and the company coincidentally changed to a limited liability company, and moved its address to Ganghwado Island. The structure itself is actually very suspicious," he explained.
Regarding the fact that the address of A corporation is Ganghwado Island and in fact, Cha Eun-woo's mother ran an eel restaurant, lawyer Kim also said, "Ganghwado Island came out of nowhere, not Gangnam, where there are a lot of entertainment agencies. The biggest benefit of moving (address) to Ganghwado Island is 'exemption from heavy acquisition tax'. If you keep holding up the profits of the corporation and save money and buy a 10 billion won building in Gangnam, you can save 480 million won," he said.
He then speculated, "We naturally intended to reduce income taxes, but I think we might have planned a big picture with real estate investment in Seoul in mind."
He also expressed his thoughts on the level of punishment. Attorney Kim said, "Criminally, the National Tax Service has the right to file a complaint." It is in the hands of the National Tax Service whether to initiate criminal proceedings. Tax evasion is generally applied in accordance with the Tax Offender Penalty Act, but in this case, the portal tax is too large, so it is highly likely that the Act on Aggravated Punishment of Specific Crimes, also known as the Special Price Act, will be applied. If the portal tax amount is more than 1 billion won, the legal sentence is slightly different. "This time, the amount of tax evaded is so large that it is a life sentence or a prison sentence of more than five years," he explained.
Another issue is whether it can be suspended, and probation is actually possible from less than three years in prison. After paying an additional 20 billion won, showing signs of self-reflection, and begging, in that case, the judge may reduce the amount at his discretion. In that case, the sentence is halved," he also mentioned the number of other cases.
Meanwhile, in the first half of last year, Cha Eun-woo was under intense investigation by the Seoul Regional Tax Office on tax evasion charges, and the National Tax Service recently notified about 20 billion won in tax collection.
The National Tax Service judged that tax evasion was carried out through corporation A established by Cha Eun-woo's mother. Cha Eun-woo reportedly worked in a structure in which his agency Fantagio and his mother's corporation A signed a service contract to support entertainment activities, and the profits were divided and attributed to Fantagio, the corporation, and Cha Eun-woo.
The National Tax Service believes that corporation A was deemed inappropriate to perform entertainment management tasks and used a trick to disperse income through a non-substantial "paper company." Cha Eun-woo signed a service contract with a separate family company in addition to his existing agency Fantagio, which was applied with a lower corporate tax rate of more than 20 percentage points instead of the income tax rate of 45 percent.
The core of this controversy is whether corporation A is involved in Cha Eun-woo's profit distribution process. In addition to the fact that the entity of the corporation is an "eel restaurant" run by Cha Eun-woo's mother amid the controversy, Cha Eun-woo has been revealed to have introduced the eel restaurant as a "dangol restaurant."
In response, Cha Eun-woo said on social media on the 26th, "I sincerely bow down and apologize for causing concern and disappointment to many people due to various things related to me recently. "With this incident, I am reflecting on myself and deeply reflecting on whether my attitude toward the duty of tax payment as a citizen of the Republic of Korea was strict enough," he said.
In addition, Fantagio said, "The main issue is whether the corporation established by Cha Eun-woo's mother is subject to real taxation," adding, "It is not currently finalized and announced, and we will actively explain issues related to legal interpretation and application in accordance with due process."
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*This content was translated by AI.
