Married Couple Fakes Divorce to Avoid Over 100 Million Won in Back Taxes... Husband Sentenced to Prison, Wife Fined

[Image source=Yonhap News]

[Asia Economy Reporter Donghoon Jeong] A first-instance court sentenced a couple in their 40s to prison and a fine, respectively, for evading payment of over 160 million won in back taxes through a sham divorce.

According to the legal community on the 19th, Judge Shin Jinhwa of the Seoul Western District Court Criminal Division 6 announced the day before that Won (47), who was indicted for violating the Local Tax Basic Act, was sentenced to one year in prison, and his wife Kim (44) was fined 30 million won.

Won did not pay 158.43 million won in taxes on income earned from company A, which he established in 2003, starting from 2014. He is accused of evading taxes through methods such as a sham divorce.

Won purchased two houses, commercial buildings, and land across Seoul, registering them under the names of his wife Kim and their young daughter, but was subject to an on-site investigation by Seoul city authorities around March 2017. Subsequently, the couple submitted a joint divorce application to the court, making Won’s share of the real estate 0% and granting only Kim custody of their daughter.

On the surface, this made it appear that Won had no assets and could not exercise authority over the property registered under their daughter’s name.

The court ruled, "The defendants hastily filed for a joint divorce to avoid having the real estate treated as joint property."

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