Singer and actor Cha Eun-woo has been embroiled in allegations of tax evasion amounting to 20 billion won, the largest in entertainment history, while his agency remained silent on whether it had retained a major law firm.
On the 26th, a Fantagio official told OSEN that it was "unable to confirm" whether a major law firm had been retained to respond to Cha Eun-woo's tax evasion allegations. As a result, legal action by Cha Eun-woo's side against the National Tax Service's additional tax assessment was effectively foreseen.
That morning, one media outlet reported that Cha Eun-woo had appointed Shin & Kim LLC as legal counsel and would continue legal action against the National Tax Service's notification of an additional tax assessment of 20 billion won. Shin & Kim LLC is a major law firm often counted among the country's top five firms. It recently drew attention for handling, on behalf of Shin & Kim LLC, litigation related to girl group NewJeans' exclusive contract.
Cha Eun-woo is suspected by the Seoul Regional Tax Service's Fourth Investigation Division of having engaged in ongoing tax evasion through a one-person agency established by his mother. The resulting additional tax assessment alone amounts to around 20 billion won, which is the highest amount levied on a domestic entertainer to date.
According to the National Tax Service, Cha Eun-woo entered into a separate service contract with a corporation in his mother's name in addition to his agency Fantagio. As a result, Cha Eun-woo's income was structured to be divided among Fantagio, the corporation in his mother's name, and Cha Eun-woo. The National Tax Service believes the corporation used tricks such as establishing itself in Ganghwa County and changing from a joint-stock company to a limited liability company to evade real estate regulations and tax scrutiny, thereby receiving a corporate tax rate about 20 percentage points lower than the top individual income tax rate of 45%.
However, Fantagio said, "The main issue in this matter is whether the corporation established by Cha Eun-woo's mother is subject to actual taxation," and added, "This is not a matter that has been finally confirmed and notified at present, and we will actively explain the issues related to legal interpretation and application through proper procedures."
Cha Eun-woo enlisted in the army band in July last year and is currently performing his military service. <
[Photo] OSEN DB.
[OSEN]