By Kim Jae-won
The tax authorities said Wednesday that it will carry out a special audit against high-income professionals as part of efforts to crack down on tax evasion.
The National Tax Service (NTS) announced that it began auditing 70 professionals and real estate businessmen suspected of underreporting their income this week.
The NTS said it seized evidence of lawyers, doctors and accountants hiding their income under borrowed-name bank accounts. The agency said the professionals allegedly did not report revenue from cash transactions.
The special investigation comes after the tax agency found 362.3 billion won in combined underreported income from 596 professionals and self-employed people audited by the agency last year.
“We will spare no effort to crack down on professionals who do not report their income diligently. They are like a cancer in society who should be expelled,” said Kim Hyeong-hwan, a director of the NTS.
The tax office released a couple of cases to illustrate how well-paid professionals evade taxes through a wide range of tricks.
A famous plastic surgeon in Seoul, identified only by his surname Kim, specializes in treating foreign patients. He underreported 2.8 billion won in income last year by hiding the money in employees’ bank accounts.
He also failed to report an additional 300 million won which he earned from running a hotel, where his foreign patients stayed while receiving treatment. He has been sent an income tax bill for 1.6 billion won.
Meanwhile a veteran lawyer, identified by his surname Lee, opened an office last year after working as a judge for about two decades. He underreported 1.2 billion won of income last year by concealing the money in bank accounts of his sister-in-law and a friend.
He also hid 200 million won in the form of a paycheck to a colleague. The NTS has charged him 900 million won for unpaid income tax and levied a fine of 300 million won.
Dentists and dermatologists are also were of underreporting income earned through cash transactions. The NTS said that most of the tax criminals bought real estate with slush funds they created and sought to increase their assets through them.
The tax office declined to unveil further information due to the National Tax Basic Law prohibiting the agency from releasing taxpayers’ private information.