Cha Eun-woo faces $13 million tax controversy amid career spotlight

Cha Eun-Woo faces allegations

• Cha Eun-woo faces allegations of large-scale tax evasion via a shell company
• Brands have pulled ads featuring Cha Eun-woo amid the ongoing investigation
• Cha Eun-woo's legal team appeals against tax authority's findings.

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South Korean actor and K-pop star Cha Eun-woo is facing a difficult moment in his career as allegations of large-scale tax evasion have emerged, casting a shadow over his otherwise carefully built public image.

The controversy centres on a company reportedly set up by Cha Eun-woo’s mother, and the fallout has already begun to ripple through the advertising world, with several brands quietly stepping back from their association with him.

According to The Korea Herald, Cha Eun-woo, a member of the popular group Astro, was recently notified by the Seoul Regional Office of the National Tax Service (NTS) that he may be liable to pay more than 20 billion won (around $13.6 million) in additional income tax.

The figure follows an intensive audit carried out in the first half of last year and is believed by industry sources to be the largest tax amount ever pursued from an individual entertainer in South Korea.

Investigators reportedly concluded that the company in question, registered as a management firm under his mother’s name, had little to no real business activity.

Authorities allege it functioned as a shell entity, allowing Cha Eun-woo’s entertainment income to be channelled through a corporate structure taxed at a lower rate, instead of the 45 per cent personal income tax.

Both Cha Eun-woo and his mother were reportedly summoned for questioning during the investigation.

The issue reportedly came to light after Cha Eun-woo enlisted for his mandatory military service in July 2025. The probe is said to have emerged during a broader investigation into Fantagio, the agency representing him, which had earlier been ordered to pay 8.2 billion won in additional taxes.

While reviewing Fantagio’s financial setup, officials allegedly uncovered the suspected arrangement linked to Cha Eun-woo.

In response, Cha Eun-woo’s legal team has filed a formal appeal challenging the tax authority’s findings.

Fantagio addressed the matter in a statement, saying, “This matter has not been finalized or officially confirmed,” and clarified that the dispute hinges on whether the company established by Cha Eun-woo’s mother qualifies as a legitimate taxable entity.

Fantagio further stated, “We will actively explain our position through lawful procedures and cooperate fully so the process can be concluded promptly. Cha Eun-woo will continue to faithfully fulfill his tax and legal obligations as a citizen.”

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As uncertainty surrounds the case, several major advertisers have reportedly taken precautionary steps. Shinhan Bank has made commercials featuring Cha Eun-woo private on YouTube and social media, while skincare brand Abib has removed advertising content involving him.

He remains a brand ambassador for companies including Saint Laurent, Calvin Klein, LG Uplus and Norang Tongdak.

Despite the controversy, Cha Eun-woo is still scheduled to appear later this year in the Netflix series The Wonderfools, even as legal proceedings continue to unfold.