227 Investigated for Tax Evasion Over "Parental Advantage" and Illicit Gifts

[Asia Economy, Sejong = Reporter Kim Hyewon] A, a high-earning professional, received tens of billions of won from his father as funds to acquire an expensive apartment, as well as a lump-sum deposit for an officetel lease. It was discovered that his father also repaid the principal and interest on financial debts secured by these properties on his behalf, indicating that A had received these assets through illicit means. Additionally, despite never having worked at his father's business, A allegedly received fabricated wages and led a lavish lifestyle using a credit card under his father's name, raising suspicions of tax evasion.

B, who has a low income, acquired several high-value real estate properties. However, at the time of acquisition and interest payments, B did not have the financial means to cover these expenses. It was also revealed that B made significant credit card purchases for luxury goods and traveled abroad frequently. B is suspected of having had all these expenses covered by his mother.

The National Tax Service announced on February 3 that it has launched tax investigations into 227 young individuals suspected of evading taxes through illicit gifts, such as using the so-called "parental advantage" to repay debts.

The National Tax Service defined the subjects of this investigation as individuals who disguised themselves as having repaid loans or acquired assets on their own, but in reality, accumulated their current wealth by leveraging their parents' financial power or by concealing income through sophisticated methods.

The investigation targets include 41 "gold spoon mom-card users" (children using their mother's credit cards) who acquired assets such as real estate and repaid loans with their parents' assets or enjoyed a lavish lifestyle using their parents' credit cards; 52 individuals who used their own credit cards and purchased high-priced homes but are suspected of receiving illicit gifts due to a lack of income or financial means.

Also included are 87 individuals who concealed the fact that their parents repaid real estate-secured loans by maintaining continuous mortgage registrations or using fake loan agreements, as well as 47 who increased their wealth by receiving money from parents who earned substantial income in booming new industries and hid those earnings.

The National Tax Service analyzed changes in loan balances, income, and spending patterns to identify suspected tax evaders who acquired assets or repaid loans with parental assistance, and traced the sources of funds in such cases.

Park Jaehyung, Director of Asset Taxation at the National Tax Service, stated, "Some wealthy individuals are using their parents' financial power for everything from asset acquisition and consumption to loan repayment, while cleverly concealing these actions. This constitutes irregular tax evasion, allowing wealth to be transferred without proper tax burdens and deepening asset polarization, which causes a sense of loss among the public." Park added, "Going forward, we will further refine our verification system for detecting irregular gifts that may occur during asset acquisition and debt repayment, and respond strictly to tax evasion."

This content was produced with the assistance of AI translation services.