Tax Evasion with 150x Excess Profit from 'Albakgi'... National Tax Service Conducts Planned Real Estate Tax Investigation

Anduksoo, Director of the Asset Taxation Bureau at the National Tax Service, is giving a briefing on the commencement of a tax investigation into real estate tax evasion on the 13th.

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The National Tax Service (NTS) has launched a tax investigation into suspects who acquired houses and land in planned redevelopment areas and then, through strategic landholding, received payments amounting to 150 times the acquisition cost from the project developers under the pretexts of 'eviction fees' and 'consulting fees,' while evading capital gains tax on these transactions.

On the 13th, the NTS announced that it will conduct tax audits on 96 individuals suspected of engaging in tax evasion related to speculative real estate transactions, including planned real estate fraud and strategic landholding and unauthorized building speculation within redevelopment areas, aiming to sound the alarm against profiteering that harms the livelihoods of ordinary citizens.

Andeoksoo, Director of the Asset Taxation Bureau at the NTS, explained the background of the tax investigation, stating, "Although real estate transactions have recently slowed, cases of planned real estate fraud that harm ordinary citizens' livelihoods and speculation that undermines housing stability continue to emerge. Scams involving planned real estate fraud targeting retirees' retirement funds by inducing small investments persist, and strategic landholding speculation that obstructs redevelopment in deteriorated residential areas and evades related taxes also continues."

The NTS identified 23 suspects who acquired houses and land in planned redevelopment areas and, through strategic landholding, received payments from project developers under the names of eviction fees and consulting fees but failed to report capital gains.

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According to the NTS, transferor B purchased land owned by his cousin A, a related party, at a low price for several tens of millions of won when real estate developer C began land acquisition for redevelopment. After acquiring the land at a low price, transferor B delayed the development project through strategic landholding and agreed to receive additional payments amounting to tens of billions of won?150 times the acquisition cost?under the guise of service fees. B evaded capital gains tax by routing the high-value transfer payments through a related corporation to reduce the tax burden.

The NTS also confirmed allegations against 32 individuals, including 12 who failed to report capital gains by exploiting the fact that unauthorized buildings within redevelopment areas were not registered, and 20 suspects with unclear sources of acquisition funds.

Additionally, the NTS identified 23 individuals involved in planned real estate fraud who sold shares of land with low development potential by inducing investments through telemarketers, and 18 suspects who maliciously evaded capital gains tax by disguising transactions. These suspects inserted insolvent or loss-making corporations without income into real estate transactions, sold properties at low prices, and then quickly resold them at high prices to actual buyers.

Director An stated, "We will continuously monitor unusual trends in real estate transactions and conduct tax audits if evasion is confirmed, responding strictly. In particular, for planned real estate fraud, we will secure tax claims early through provisional seizure and cash collection before confirmation, and if tax evasion is confirmed, we will take strong measures such as referring cases to the prosecution."

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