SM Entertainment Ordered To Pay 20 Billion Won After Tax Evasion Investigation

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SM Entertainment has received a recent tax investigation and has been ordered to pay 20.2 billion won (approximately $18 million).

The investigation was held by the National Tax Service Seoul Regional Tax Office and was carried out on SM Entertainment and it’s executive producer Lee Soo Man. It was described as an irregular tax investigation, known as a “special tax investigation,” which occurs when there are suspicions of tax evasion.





When the news of a tax investigation first came out, SM responded that they’re cooperating and are awaiting results, however, they stated that it was a regular tax investigation that began in September of 2020.

The investigation was started after the taxation authorities detected an outflow of company capital in Lee Soo Man’s corporate transactions. On February 5, SM Entertainment announced that it has been ordered to pay an additional collection amount of 20.2 billion won following the tax investigation which amounts of 3.19% of its capital.

In an official statement, SM explained that they would be paying before the deadline at the end of March, but will carry out an appeal.

This isn’t the first time SM was involved in such controversy, it previously underwent tax investigations in 2009 and 2014. In 2014, it was ordered to 10.2 billion won (approximately $9.1 million) in corporate taxes.

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