Jeonju City Uncovers 78 Cases of Illegal Real Estate Transactions by Outsiders

Evasion of Gift Tax, Violation of Real Estate Transaction Reporting Act...Fines Imposed and Notification to Jurisdictional Tax Office

[Jeonju=Asia Economy Honam Reporting Headquarters Reporter Kim Hanho] Jeonju City announced on the 5th that it has uncovered a total of 78 violations after investigating whether illegal transactions by outsiders suspected of abnormal real estate transactions had occurred.

The investigation targeted transactions involving 740 outsiders, including △properties traded by outsiders during the period of rapid price increase since September 2019 △apartments priced below 100 million KRW in official assessed value where a recent surge in outsider purchases was detected.

The investigation revealed a total of 78 illegal acts, including 51 suspected cases of disguised gifting, 26 violations of the Real Estate Transaction Reporting Act, and 1 violation of the Income Tax Act.

Specifically, the most common cases were disguised gifting where the source of purchase funds was unclear or where the parties failed to provide evidence of borrowing funds from family members or third parties.

Following that were cases violating the Transaction Reporting Act, such as direct transactions between parties on properties not subject to reporting despite no actual monetary exchange, false reporting of contract dates to avoid late reporting fines, and underreporting the actual transaction amount in so-called "down contracts."

Jeonju City imposed fines on 26 individuals for violating the Real Estate Transaction Reporting Act and reported 51 individuals suspected of disguised gifting to the relevant tax office. Other violations will be addressed according to applicable laws and regulations.

Jeonju=Honam Reporting Headquarters Reporter Kim Hanho stonepeak@asiae.co.kr