Group ASTRO member and actor Cha Eun-woo has reportedly been hit with an income tax reassessment of more than 20 billion won on allegations of tax evasion, and advertising industry cutoffs have begun in earnest.
On the 23rd, OSEN confirmed that Shinhan Bank changed Cha Eun-woo's videos and posts that were public on its YouTube channel and social accounts to private. Those videos display messages such as "This video cannot be played" and "This is a private video" and cannot be played. The reason the videos and photos were deleted was not disclosed, but because the move was taken immediately after Cha Eun-woo faced allegations of tax evasion, it can be presumed to be a consequence of that. Shinhan Bank had earlier replaced Kim Soo-hyun, who was embroiled in the late Kim Sae-ron grooming controversy, with Cha Eun-woo as its model.
Cha Eun-woo is reported to have been notified of an income tax reassessment of more than 20 billion won. Last year the Seoul Regional Tax Service's Investigation Division 4 conducted a high-intensity investigation into Cha Eun-woo over allegations of tax evasion through a one-person agency established by his mother and notified him of an income tax reassessment of more than 20 billion won. An income tax reassessment of more than 20 billion won is the largest amount of tax ever reassessed from an entertainer.
Cha Eun-woo has been active under a system in which his agency Fantagio and a one-person agency set up by his mother signed a contract for services to support entertainment activities. Income earned by Cha Eun-woo is known to have been divided among Fantagio, the one-person agency and Cha Eun-woo himself.
However, the National Tax Service judged that the one-person agency set up by his mother was a paper company that did not actually provide services. It concluded that Cha Eun-woo and his mother established a corporation and distributed income to reduce income tax that reached 45%, and used a trick by applying a corporate tax rate that is 20 percentage points lower than the income tax rate.
Fantagio said, "This matter is primarily about whether the corporation established by Cha Eun-woo's mother falls under the scope of substantive taxation, and it is not a matter that has been finally confirmed and notified. We will actively explain the issues related to tax interpretation and application through proper procedures. The artist and tax representative will cooperate faithfully so that the procedure can be completed quickly."
[OSEN]