Lee Joon Gi has been slapped with a 900 million won ($620,000) tax bill. However, the actor has contested the tax authorities’ decision and has filed for a review with the Tax Tribunal.
According to a report on March 19th, the Gangnam Tax Office in Seoul initiated a tax investigation against Lee Joon Gi and his agency, Namoo Actors, in 2023.
During this process, the National Tax Service (NTS) imposed an additional 900 million won in taxes on Lee Joon Gi. In response, he applied for a pre-assessment review, but his request was denied. Ultimately, he filed a formal appeal with the National Tax Tribunal.
The background of the tax assessment is as follows:
The NTS identified issues related to transactions between Namoo Actors and Lee’s personal agency, J Entertainment.
Lee established J Entertainment in January 2014 and signed an exclusive contract with Namoo Actors later that year. The contract was structured so that Namoo Actors would pay the appearance fees to J Entertainment rather than directly to Lee. As a result, J Entertainment has been reporting Lee’s appearance fees as corporate revenue and paying corporate taxes accordingly.
However, the NTS raised concerns about this arrangement. They claimed that tax invoices issued between Namoo Actors and J Entertainment did not reflect the actual circumstances. The fees received from Namoo Actors should be classified as personal income, they asserted. Given that the highest corporate tax rate is 24% while the highest personal income tax rate is 45%, the NTS determined that there was significant potential for tax evasion.
The NTS rejected the corporate taxes already paid by J Entertainment and reclassified them as personal income taxes, subsequently imposing an additional tax of 900 million won on Lee Joon Gi.
Lee’s representatives have expressed their dissatisfaction with the ruling.
A representative from Namoo Actors stated, “Lee Joon Gi respects the tax authorities’ decision and has paid the full amount of the tax. However, this ruling is entirely different from the NTS’s existing tax practices.”
They further explained, “The Gangnam Tax Office believes that Namoo Actors should have paid the appearance fees directly to Lee, but we have diligently reported our taxes under existing practices, based on advice from our tax consultant.”
J Entertainment was co-founded by Lee and his father, with both listed as co-CEOs.
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