[Anchor]

A series of cases have been uncovered where corporate-owned luxury housing was used for the personal purposes of owner families. From interior design costs to maintenance fees, everything was paid for using company funds, and the amount of suspected tax evasion alone reaches 1.9 trillion won.

Here is a report by reporter Lee Tae-gwon.

[Reporter]

This is an apartment complex in Banpo-dong, Seoul.

A person surnamed A, who runs a business in Busan, purchased a multi-billion-won apartment here under a corporate name.

However, an investigation by the National Tax Service revealed that the actual resident was A's child, who works in Seoul, and that maintenance fees and construction costs were also processed as corporate expenses.

[Banpo-dong Real Estate Agent: When corporations buy them, they often buy them for dormitory use. (Have you ever heard of cases where they buy them to live in themselves?) I have heard of such cases. It is a loophole; originally, you should not do that.]

As a result of the National Tax Service investigation, Corporation B, which operates hotels and resorts, purchased a 20 billion won house in Hannam-dong and used corporate funds to do 10 billion won worth of luxury interior remodeling for the personal use of the owner family.

It was also found that 20 billion won in corporate funds was embezzled under the guise of labor costs.

Other cases were successively uncovered, such as purchasing a reconstruction apartment in Seoul to become a two-home owner and then transferring the existing home to one's own corporation to live in it rent-free and evade taxes, or purchasing luxury condos under the pretext of employee welfare to use them as private vacation homes exclusively for the owner family.

When the National Tax Service investigated 2,600 high-priced corporate houses with an official assessed value of 900 million won or more, it was found that 42 percent of them, or some 1,090 houses, were used privately by owners and others in this manner.

The total amount of suspected tax evasion by 50 corporations with serious violations, including five large conglomerates, was estimated at 1.9 trillion won.

[Lee Sung-geul / Director General of the Investigation Bureau, National Tax Service: We confirmed not only the private use of real estate, but also tax evasion practices such as paying fabricated labor costs to the owner's family and issuing false tax invoices.]

The National Tax Service stated that it will expand the scope of its investigation to include cases such as providing overseas private residences to children studying abroad, as well as domestic emperor-like residences, continuing its crackdown on overall corporate fund embezzlement.

(Photo courtesy of Yonhap News)
(Reported by Lee Tae-gwon | Video by Park Hyun-chul | Video Editing by Lee So-young | Graphics by Kim Han-gil)