Cha Eun-woo accused of using a ‘paper company’ in $13.6 million tax case

ASTRO member and actor Cha Eun-woo is reportedly under scrutiny for alleged tax evasion.

Eun-woo's agency Fantagio told OSEN, “We are currently gathering information and preparing a statement,” adding, “We will announce our official position shortly.”

Earlier the same day, reports emerged that Eun-woo had been hit with a tax reassessment exceeding 20 billion won by the National Tax Service over alleged income tax evasion — marking the largest-ever tax reassessment on a Korean celebrity.

Last spring, Eun-woo came under intense scrutiny as the Seoul Regional National Tax Service Investigation Division 4 launched a high-profile investigation into alleged tax evasion. The case reportedly mirrors recent celebrity tax controversies involving “one-person agencies,” such as those of Sung Si-kyung and Ok Joo-hyun.

According to reports, by Chosun Daily, a company established by Euno-woo’s mother, referred to as A Corporation, was positioned between his agency, Fantagio, and the star himself. Fantagio and A Corporation signed a service contract to support Euno-woo’s entertainment activities, and his earnings were subsequently divided among Fantagio, A Corporation, and Euno-woo.

However, the National Tax Service concluded that A Corporation was essentially a “paper company” that did not provide real services. Authorities allege that Eun-woo and his mother created the shell corporation to reduce income tax, which normally stood at 45 per cent, by distributing earnings through the company and paying a lower corporate tax of just over 20%, as Chosun Daily explains.

Amid the tax investigation, Eun-woo has also been fulfilling his mandatory military duties. In May of last year, he passed the final review for the military band under the Ministry of National Defense and began active service in July. His discharge is scheduled for January 27, 2027.

Following the audit, Eun-woo’s side has submitted a request for reevaluation, maintaining that the company in question “is formally registered as an entertainment agency and is not a paper company,” according to allkpop.

The development comes as Cha Eun-woo is currently serving his mandatory military service. He enlisted as an active duty soldier in July last year and remains enlisted at the time of the investigation.

The case is still under review, and no final conclusions have been announced.