Gyeonggi-do Imposes 960 Million KRW Fine on 150 People for False Real Estate Transaction Reports

Gyeonggi Provincial Government Gwanggyo New Office Building

[Asia Economy (Suwon) = Reporter Lee Young-gyu] A total of 150 people who falsely reported real estate transactions to evade tax obligations were caught in a special investigation conducted by Gyeonggi Province.

Gyeonggi Province announced on the 16th that from September to December last year, it conducted a special investigation into 2,106 suspected cases of false real estate reporting across 31 cities and counties in the province, resulting in the detection of 150 false reporters (75 cases) and the imposition of fines totaling 962 million KRW.

The province classified suspicious cases of false reporting as including up/down contracts, false contract dates, sales between special relations (relatives), inability to verify transaction amounts, false reports without monetary transactions, and transactions suspected of gifts in funding plans for housing transactions in regulated areas.

The investigation revealed a total of 150 people: 7 who made 'up contracts' by agreeing on prices higher than the actual transaction amount to manipulate market prices or increase mortgage loan limits; 12 who made 'down contracts,' a double contract where the contract price is lower than the actual transaction price to reduce capital gains tax; and 131 who delayed reporting, falsely reported contract dates, or failed to submit documents.

Among the major cases, Mr. A reported selling land in Yangju City to Mr. B for 400 million KRW in the actual transaction report, but the investigation found that Mr. A underreported the transaction amount by 50 million KRW to reduce capital gains tax. Accordingly, the province imposed a total fine of 24 million KRW on both the seller and buyer.

Mr. C signed a sales contract for an apartment in Hanam City for 800 million KRW and reported the actual transaction, but it was revealed that the purchase payment was made by Mr. C’s father, leading to a report to the National Tax Service on suspicion of gift tax evasion.

Additionally, six individuals were separately caught for unfair practices by real estate agents, including unregistered brokerage activities and charging excessive brokerage fees. These agents will face criminal charges and administrative sanctions.

Meanwhile, excluding the 75 detected cases from the 2,106 suspicious cases, the province found no suspicious points in transaction documents but reported 344 cases to the National Tax Service where the real estate sellers and buyers were confirmed to be special relations such as family or relatives, or where transactions were reported at absurd prices compared to surrounding market prices, requesting tax investigations for possible capital gains tax evasion or other illegalities.

By type, these include 126 cases of special relation sales, 39 cases of suspicious transaction prices, 21 cases where transaction amounts could not be verified, 8 cases of debt repayment in kind, and 150 other cases (including suspected disguised gifts).

Ko Jung-guk, Director of the Land Information Division of the province, stated, "This year as well, we plan to continuously conduct special investigations into suspected false real estate transaction reports to establish a fair and transparent transaction order," adding, "Voluntary reporters will be given reduced fines."

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