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On Sunday (Feb 1), South Korean media outlet Sports Kyunghyang reported that actor Kim Seon-ho was running a separate, family-owned production company alongside his activities at his current agency, Fantagio, raising suspicions of tax evasion. Fantagio has since responded and asserted that “there are absolutely no issues whatsoever”.
This news comes after fellow Fantagio artiste, South Korean actor-singer Cha Eun-woo, was revealed to be under investigation for tax evasion after owing 20 billion won (US$13.6 million) in unpaid taxes.
The report from Sports Kyunghyang claimed that Kim, known for his role in Hometown Cha-Cha-Cha, was the representative director of a performance planning corporation operated under his residential address in Seoul, while the company’s internal director and auditor are said to be his parents.
The company’s business profile included entertainment-related activities as one of its purposes, however, it has failed to register as a public arts and culture planning business. The outlet suggested that the company’s board consisting only of family members without external professionals allowed for flexible fund management within the family, leading to potential tax evasion.
It further reported that the company’s bank accounts were used to pay monthly salaries to Kim’s parents, said to range from several million to tens of millions of won, with the funds allegedly transferred back to Kim every month.
Corporate cards were also reportedly used by Kim’s parents for personal expenses. These included living costs and entertainment, as well as the registration of the family vehicle under the company’s name.
The alleged intent was to reduce corporate tax by inflating company expenses and claiming them as deductible. It also raised concerns that the use of corporate credit cards for personal spending could point towards breach of trust and embezzlement. With the company’s registered address reportedly matching Kim’s place of residence, the outlet raises speculation of the corporation being a “paper company”.
South Korean actor Kim Seon-ho for W Korea. (Photo: Instagram/seonho__kim)
On the same afternoon, Kim’s agency, Fantagio, released an official statement, rejecting the allegations.
“Kim Seon-ho is currently carrying out his activities under an exclusive contract signed with Fantagio in his personal capacity, and he is dutifully following all legal and tax-related procedures regarding his current contractual relationship and activities. We would like to make it clear that there are absolutely no issues whatsoever related to the contract or activities between Kim Seon-ho and Fantagio,” the agency said.
It affirmed that the company set up by Kim was “never created with any intention of tax avoidance or tax evasion.”
After his transfer to Fantagio about one year ago, all business operations under that company ceased and it “is currently in the process of being officially dissolved in accordance with relevant laws and procedures.”
The label ended their statement with a promise to “comply with all relevant laws and procedures in every aspect of our activities, and we will do our utmost to ensure that the actor’s career can proceed without unnecessary misunderstandings”.
