The entertainment agency established by the mother of actor Jang Geun-suk filed a lawsuit against the tax authorities to cancel the corporate tax imposition, but lost in the first trial.
The Seoul Administrative Court ruled against the plaintiff in a lawsuit against the head of the Seoul Regional Tax Office and the head of the Gangnam Tax Office, against the head of the Seoul Regional Tax Office and the Gangnam Tax Office.
In 2016, the tax authorities conducted a tax investigation after receiving information from the Japanese National Tax Service that Company A may have missed tax returns.
Company A voluntarily paid corporate tax immediately after the tax investigation started, but the authorities notified that it was required to pay an additional 320 million won, including penalty for fraudulent and underreporting.
In response, Company A filed an administrative lawsuit saying, 'It is illegal to impose a penalty for underreporting even though there was no intention to evade corporate tax'.
The court ruled that 'tax evasion was made because corporate profits were paid to an overseas account that is difficult to track by the National Tax Service and not reported'.
Company A was dissatisfied with this judgment and appealed.