Kwanghyun Lim: "'Imperial Residences' Issue Severe... 42% of Corporate-Owned Homes Used for Private Purposes"

Commissioner Kwanghyun Lim on His Social Media

National Tax Service Investigates 2,639 High-Priced Corporate-Owned Residences

12 Residences Exceed 10 Billion Won... The Most Expensive Valued Over 20 Billion

Kwanghyun Lim, Commissioner of the National Tax Service, stated on the 23rd, "The National Tax Service has conducted its first comprehensive investigation into high-priced corporate residences that qualify for comprehensive real estate holding tax, specifically those exceeding the standard public housing size and with disclosed price tags over 900 million won, and the results were more serious than expected."

On this day, Commissioner Lim pointed out via his social networking service (SNS) account, "There is an issue similar to the matter of supercars registered under corporate names: the so-called 'Emperor's Residences,'" highlighting the seriousness of the problem.

Kwanghyun Lim, Commissioner of the National Tax Service.

According to the National Tax Service, out of the total 2,639 corporate housing units with a disclosed land value exceeding 900 million won, 1,157 units were for lease by leasing corporations and 385 were used as employee dormitories or for work purposes. Excluding these, 1,097 units (42 percent) were found to be used by major shareholders and their families for private residential use.

Commissioner Lim emphasized, "The average disclosed price of the fully verified residences exceeds 2 billion won. There are 453 residences valued over 3 billion won, 12 residences exceeding 10 billion won, and the highest priced one is over 20 billion won. Corporations that have privately used such high-priced residences range from small and medium-sized enterprises with annual sales of several billion won to large-scale conglomerates with trillions of won in revenue."

Although the current tax law clearly defines the benefit and maintenance costs of company residences used by executive shareholders and their relatives as taxable income, the investigation has confirmed that irregular, cost-free residence arrangements have been a de facto customary practice in some parts of the industry.

Commissioner Lim criticized, "Certain companies have provided ultra-high-priced apartments with views of the Han River or in Gangnam and Yongsan as luxury residences for major shareholders or their children, keeping such arrangements an open secret from regular employees." He also added, "There are real estate speculators who transferred their own single high-priced residences to corporate ownership to avoid multi-homeowner regulations."

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He continued, "The investigation has confirmed that all of these cases are factual. For salaried employees who pay every single won of taxes through withholding, and for office workers whose use of even a single office supply item is tightly controlled, it is difficult to accept the private misuse of corporate assets by major shareholders."

Commissioner Lim announced stringent investigations ahead. He stated, "The National Tax Service views abnormal behaviors such as the private use of corporate housing by major shareholders as a key indicator of the broader risk of corporate tax evasion, and we will conduct rigorous tax investigations on the overall compliance of corporations where such allegations are substantiated." He further added, "We will also expand our audits beyond domestic emperor's residences to luxury condominiums, unpaid provision of overseas corporate residences or support for study-abroad expenses for the children of chairmen, and all forms of embezzlement of corporate funds."

This content was produced with the assistance of AI translation services.