Cha Eun-woo ₹124.57 Crore Tax Envasion Case Explained: Agency’s Official Statement To Brands Dropping The ASTRO Star, Here’s What Happened So Far

South Korean star Cha Eun-woo has landed in controversy as the National Tax Service is investigating him in a 20 billion KRW tax evasion probe linked to an alleged paper company registered in his mother’s name, affecting his brand endorsements. The actor and singer is a member of the K-pop group ASTRO and is popular for his roles in web shows such as True Beauty, Wonderful World, Island and more. He is currently serving South Korea’s mandatory 18-month military training after being enlisted on July 25. The case has shocked fans, as investigators are examining claims about companies connected to his mother and questioning how income from his entertainment career was reported. Here is everything known so far.

Cha Eun-woo's tax evasion case explained

According to reports, the Seoul Regional National Tax Service Investigation Bureau 4 informed Cha Eun-woo last year that he may owe additional taxes exceeding 20 billion won (around £11.6 million, or roughly $13.6 million).

As per reports, authorities claim that a company set up by his mother, publicly known as Cha’s Gallery and later followed by successor firms, played a role in a tax structure that shifted income to lower corporate tax rates instead of higher personal income tax rates.

The dispute mainly focuses on the way Cha Eun-woo’s earnings were shared. Although Fantagio represents him, the National Tax Service argues that the arrangement routed income through a company registered under his mother’s name and then split it among the agency, the company and Cha, which reduced the overall tax paid.

Investigators reportedly disclosed that the firm operated as a “paper company” without real business activity, and they therefore ruled that the tax payments fell short.

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The Dispatch’s investigation points to a complex family-run business structure. Cha’s Gallery began operations in July 2019, naming Cha Eun-woo as CEO, his mother as an internal director, and his father as the finance manager.

The company registered an unusually wide business scope, covering 34 areas such as music production, artist management, concerts, advertising, theme parks, and food services. In 2020, the firm shifted its registered address from Anyang to Gimpo City, and in 2022, it moved again to Ganghwa Island, where Cha’s parents run an eel restaurant.

The company shut down in 2024. After this, reports say Cha’s mother created new firms, including L&C LLC and D ANY LLC, with the latter set up to manage Cha Eun-woo’s assets.

Cha Eun-woo’s legal team has challenged the National Tax Service’s assessment. They filed a pre-assessment review and stated that the company registered under his mother’s name operates as a lawful entity in popular culture and arts planning. Fantagio supported this view, saying that “nothing has been finally confirmed or officially notified at this time” and confirmed its cooperation with the legal process.

The issue has already affected commercial ties. Several brands linked to Cha Eun-woo, including skincare brand Abib and financial advertiser Shinhan Bank, have removed or concealed promotional content featuring him after the allegations emerged. This move shows how tax-related reputation risks can quickly influence brand partnerships in the entertainment industry.

Many Industry experts highlight the scale of the dispute. If the alleged tax evasion of 20 billion won reflects an avoided personal income tax rate of about 45 per cent, the diverted income could exceed 100 billion won. This estimate would rank the case among the largest tax disputes involving an individual entertainer in South Korea.