Cha Eun Woo May Have to Cough Up $20 Million as Mother’s Company Revealed to Be Family Owned Restaurant

The tax evasion scandal surrounding star Cha Eun Woo is escalating, with new reports suggesting that the company at the center of the controversy may have been a “paper company” registered at a family-owned restaurant.

It was revealed on January 22nd that the company established under the name of Cha’s mother had listed its business address at an eel restaurant in Ganghwado, Incheon.

According to registry documents, the company was established in October 2022 and registered as a management business. However, the National Tax Service (NTS) reportedly flagged the company after discovering that its initial headquarters shared the same address as the eel restaurant operated by Cha’s parents.

The location is well-known among his fans as a place to meet the star’s parents and enjoy delicious eel, but the NTS deemed it an unsuitable facility for conducting actual entertainment management business. The corporation reportedly changed its address to an office in Seoul on December 23rd of last year.

The NTS alleges that Cha Eun Woo used this company to lower his tax rate. By signing a management service contract with his mother’s company and splitting the profits, authorities believe he sought to apply the lower corporate tax rate instead of the maximum 45% individual income tax rate applicable to high earners.

Fantagio, Cha’s agency, declined to comment on the specific address issue, stating, “It is difficult to confirm details beyond our official statement.”

The financial stakes are substantial. While initial reports indicated that Cha was notified of 20 billion won ($13.6 million) in unpaid taxes, experts warn that the final bill could be much higher.

“If the tax evasion facts are confirmed, additional penalties for underreporting and delayed payment will be imposed,” a tax industry insider told TenAsia. “These surcharges can add up to 40% of the collected amount. Depending on the case, the total penalty could exceed 30 billion won ($20.4 million).”

The NTS’s notification follows a high-intensity tax audit conducted last spring before Cha’s military enlistment in July. The star is currently serving in the Army Band.

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