LG Twins Player Oh Ji-hwan MVP
Expresses Intention to Donate Rolex Watch
Taxes Apply Even If Donated
LG Twins Must Pay Corporate Tax
The owner of the Rolex watch left by the late Koo Bon-moo, chairman of LG Group, has been revealed. It is Oh Ji-hwan, the captain of the LG Twins, who received the Korean Series (KS) Most Valuable Player (MVP) award. Instead of keeping the Rolex watch, Oh expressed his intention to donate it so that many people can see it on display.
After winning Game 5 of the 2023 professional baseball KS against the kt Wiz at Jamsil Stadium in Seoul on the 13th, Oh said in an interview, "I think that watch is a relic of the former chairman," and added, "I will first give it to Chairman Koo Kwang-mo." He also expressed his wish that "the Rolex watch be exhibited so that many people can see it."
Previously, Chairman Koo Bon-moo purchased a Rolex watch worth about 80 million won during an overseas business trip in 1998, promising to give it to the MVP player if the LG Twins won the championship, and delivered it to the team. Since then, the watch remained in the LG Twins office safe without an owner, until it finally saw the light of day.
Oh expressed his wish for the watch to be displayed in the LG Twins archive room. The LG side stated that nothing has been decided yet regarding Oh’s interview comments. However, in any case, taxes cannot be avoided. Even if the donation happens as Oh wishes, taxes will be imposed.
If the team transfers the watch to Oh and then Oh donates the watch back to the team, both Oh and the team must pay taxes separately. Oh must pay gift tax or earned income tax (if the watch is considered part of his salary) when receiving the watch.
In the case of gift tax, the amount varies depending on the appraised value. If the appraised value is under 100 million won, 10% of the amount must be paid as gift tax. If the appraised value is between 100 million and 200 million won, the gift tax rate rises to 20%. A National Tax Service official explained, "If the taxpayer submits an appraised market value within 3 months after 6 months before the gift date, the Statistical Office verifies it and then gift tax is imposed," adding, "The appraised value is determined by evaluating sales, auctions, public sales, and appraisal prices."
If the gift value is calculated based on the secondhand market price (over 100 million won), the gift tax will likely be around 30 million won applying the 20% rate. After applying the progressive deduction (10 million won), the actual gift tax will be around 20 million won. However, since this product is rarely traded and the suggested secondhand price is set by a seller who has not completed a sale, an accurate appraisal may be necessary.
The appraisal industry estimates that after professional appraisal, the gift value could be lower than the current secondhand price. If the gift value falls below 100 million won, the gift tax will be reduced to under 10 million won. A representative from the Korea Movable Property Appraisal Institute said, "The appraisal price is a guarantee amount concept rather than a general market price, so it can be lower than the market price," and added, "Since appraisals vary slightly by company, at least two places are checked and the average price is given."
When the team receives the watch as a donation from Oh, it must record the income based on the Rolex watch market price. Then, the team pays taxes when filing corporate tax. However, if the team and Oh handle the watch internally without transferring it back and forth, Oh does not have to pay taxes, and only the team pays corporate tax.
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