🚨 High-Amount Habitual Tax Delinquents: Tax Evasion and Asset Hiding Problems

Today Korean Social News | June 11, 2025

📌 Tax Agency Tracks Assets of 710 High-Amount Tax Delinquents…Discovers Hidden Cash Bundles

💬 Korea's National Tax Service has launched a major investigation into 710 high-amount habitual tax delinquents who intentionally avoid paying taxes and hide their assets. These people used clever methods like fake divorces, borrowed-name bank accounts, and buying expensive luxury items to hide their wealth. The tax agency plans to collect about 1 trillion won in unpaid taxes through strong legal actions like lawsuit to cancel fraudulent transactions and canceling fake property ownership. Some tax evaders were caught hiding bundles of cash in bank safes or buying expensive real estate under family members' names.

Summary

• High-amount habitual tax delinquents are people who intentionally avoid paying large amounts of taxes while hiding their assets.
• They hide assets using fake divorces, borrowed-name accounts, and luxury goods purchases.
• This hurts government tax collection and unfairly burdens honest taxpayers.

1️⃣ Definition

High-amount habitual tax delinquents are people who intentionally avoid paying large amounts of taxes while hiding or disposing of their assets to escape government tax collection. Simply put, these are people who have the ability to pay taxes but intentionally hide their wealth to avoid paying taxes.

These people don't just delay paying taxes temporarily. They repeatedly and systematically avoid their tax duties in planned ways.

💡 Why is this important?

• It seriously hurts government tax collection, causing problems with public services.
• It creates unfair tax inequality and makes honest taxpayers feel cheated.
• It damages healthy economic order and social trust.
• It spreads tax evasion behavior and weakens overall tax compliance.

2️⃣ Characteristics and Asset Hiding Methods

📕 Standards and Characteristics of High-Amount Tax Delinquents

• There are clear standards for high-amount habitual tax delinquents. The main standards are:

  • Individuals or companies with unpaid taxes of 500 million won or more.
  • Tax delinquency lasting 2 years or more with confirmed intentional avoidance like asset hiding.
  • The tax agency publicly releases their names each year for social punishment.
  • They face administrative penalties like travel bans and financial transaction restrictions.

• High-amount tax delinquents share common characteristics. Main characteristics include:

  • They have high income or many assets but refuse to pay taxes.
  • They use clever and planned methods to hide or dispose of assets.
  • They use various illegal methods to avoid tax investigations and collection.
  • They exploit legal loopholes or get help from experts for tax evasion.
  • Many have high social status or influence, making the problem worse.

📕 Main Asset Hiding Methods

• They use various clever asset hiding methods. Main methods include:

  • Fake divorce: Getting fake divorces to transfer assets to spouse's name.
  • Borrowed-name accounts: Opening bank accounts under other people's names to store cash.
  • Name trust: Registering real estate or stocks under other people's names to hide ownership.
  • Overseas asset transfer: Moving assets to foreign banks or real estate to make tracking difficult.
  • Luxury goods purchase: Converting cash into jewelry, art, luxury items for storage.

• New hiding methods are being discovered recently. New methods include:

  • Using cryptocurrency: Converting assets to Bitcoin and other cryptocurrencies to avoid tracking.
  • Complex corporate structures: Creating multiple shell companies to spread and hide assets.
  • Cash-only transactions: Using only cash to avoid leaving bank transaction records.
  • Rental contracts: Using lease or rental agreements to hide cash.
  • Family involvement: Using children, relatives, and entire families to spread assets.

Main Problems with High-Amount Tax Delinquents

1. Tax justice damage: Hurts fairness with honest taxpayers and creates tax burden imbalance
2. Government financial loss: Reduced tax income hurts ability to provide public services
3. Economic order disruption: Creates unfair competition and hurts healthy business activities
4. Social trust damage: Lowers public trust in laws and institutions
5. Copycat effect: Weakens other taxpayers' tax compliance and spreads tax evasion

3️⃣ Government Response and Collection Activities

✅ Tax Agency Tracking and Collection Activities

• The tax agency operates systematic tracking systems. Main tracking methods include:

  • Using big data analysis to find asset hiding patterns and detect suspicious transactions.
  • Expanding information sharing with related agencies like Financial Intelligence Unit and Customs Service.
  • Tracking overseas hidden assets through cooperation with foreign tax authorities.
  • Using artificial intelligence (AI) and machine learning technology to find hidden assets.
  • Analyzing tax delinquents' lifestyle patterns and spending habits to find hidden wealth.

• They use strong collection methods. Main collection methods include:

  • Filing lawsuits to cancel fraudulent transactions to recover illegally disposed assets.
  • Canceling ownership registration of name-trust real estate to reveal real owners.
  • Imposing administrative penalties like travel bans, financial transaction restrictions, and high-value asset transaction limits.
  • Enforcing business closure, asset seizure, and public auction.
  • Filing criminal charges to pursue criminal punishment for intentional tax delinquents.

✅ Recent Collection Results and Cases

• They achieve significant collection results each year. Main results include:

  • Set a goal to collect about 1 trillion won in unpaid taxes from 710 high-amount tax delinquents in 2024.
  • Continuously discovering hidden assets while catching asset hiding methods.
  • Achieving over 90% success rate in lawsuits to cancel fraudulent transactions.
  • Increasing cases and amounts of overseas hidden asset tracking each year.

• Specific discovery cases are being revealed. Main cases include:

  • One tax delinquent was caught storing billions of won in cash as bundles of checks in bank safes.
  • Many cases found people buying expensive apartments under spouse's name after fake divorces.
  • Cases included buying overseas real estate or establishing foreign corporations under children's names.
  • Some converted assets into high-value luxury items like antiques, famous paintings, and expensive watches.
  • Tax evaders trying to avoid tracking by converting to cryptocurrency have been recently caught.

4️⃣ Related Terms

🔎 Tax Delinquency

• Tax delinquency means not paying taxes by the deadline.
• Tax delinquency refers to the state of not paying taxes by the legal payment deadline. All taxes have set payment deadlines, and if you don't pay by these deadlines, you become tax delinquent. When tax delinquency occurs, additional taxes are charged to the delinquent, and the tax agency can take various collection measures.
• Main characteristics of tax delinquency include: First, you become delinquent immediately after the payment deadline passes. Second, additional taxes keep increasing based on delinquent days. Third, larger delinquent amounts lead to stronger collection measures. Fourth, long-term delinquency brings disadvantages like credit rating drops and travel restrictions.
• When tax delinquency occurs, it's good to immediately contact the tax agency to apply for relief measures like installment payments or payment deferrals. If you intentionally continue delinquency, you may face forced collection measures like asset seizure and public auction.

🔎 Fraudulent Transaction

• Fraudulent transaction is disposing of assets with the purpose of harming creditors.
• Fraudulent transaction refers to acts where debtors intentionally reduce their assets with the purpose of harming creditors. Simply put, it's intentionally getting rid of or hiding assets to avoid paying debts. In tax collection cases, typical fraudulent transactions include taxpayers giving assets to family members or selling them at very low prices to avoid paying taxes.
• Main requirements for fraudulent transactions include: First, the debtor's assets must decrease. Second, there must be intent to harm creditors. Third, beneficiaries or transferees must know about these circumstances. Fourth, creditors must suffer damage.
• When fraudulent transactions are recognized, creditors can exercise the right to cancel fraudulent transactions. The tax agency can also file cancellation lawsuits against tax delinquents' fraudulent transactions to recover disposed assets and collect taxes. This is an important legal tool to prevent tax delinquents from hiding assets.

🔎 Name Trust

• Name trust is a form of asset holding where the real owner and registered owner are different.
• Name trust refers to when the real asset owner (trustor) registers assets under another person's (trustee) name, but the trustor actually owns and manages the assets. Typical cases include registering real estate or stocks under other people's names while actually owning and managing them yourself.
• Main characteristics of name trust include: First, the formal owner and real owner are different. Second, the real owner bears all rights and obligations. Third, the registered owner simply lends their name. Fourth, it's mostly used for illegal purposes (tax avoidance, asset hiding, etc.).
• Name trust is mostly prohibited by Real Estate Real Name Act, Financial Real Name System, etc. Especially when tax delinquents use name trust to hide assets, the tax agency treats the trustor as the real owner according to substance over form principle, charges taxes, and can reveal the name trust relationship to seize assets.

5️⃣ Frequently Asked Questions (FAQ)

Q: Do I become a high-amount habitual tax delinquent if I accidentally pay taxes late?

A: No. To become a high-amount habitual tax delinquent, you must meet several conditions. First, unpaid taxes must be 500 million won or more. Second, the delinquency period must be 2 years or more. Third, intentional avoidance activities like asset hiding must be confirmed. Simply missing payment dates by mistake or temporary delays due to financial difficulties don't make you a high-amount habitual tax delinquent. However, paying taxes late results in additional taxes from the day after the payment deadline, so it's best to pay within the deadline when possible. If you can't pay taxes due to economic difficulties, you can apply to the tax agency for installment payments or payment deferrals. Using these systems can help you avoid delinquency while reducing economic burden. The important thing is not to intentionally avoid paying taxes or hide assets.

Q: What penalties do you face if designated as a high-amount habitual tax delinquent?

A: Being designated as a high-amount habitual tax delinquent brings very strong penalties. First, your name is publicly released for social punishment. The tax agency publicly releases the list of high-amount habitual tax delinquents to the media each year. Second, overseas travel is banned. You can't travel abroad or take business trips, causing major problems for personal life and business activities. Third, financial transactions are restricted. Bank loans, credit card applications, and insurance enrollment become difficult. Fourth, high-value asset transactions are restricted. Real estate sales, car purchases, and golf membership transactions are prohibited. Fifth, business activities are restricted. You face business registration denial, various license restrictions, and government bid participation bans. Sixth, assets are seized and put up for public auction. Finally, you may be criminally charged and receive prison sentences or fines. These penalties continue until the tax delinquent pays all taxes in full.