How to Cancel a 100 Million Won Income Tax Bomb from Name Lending: A Real Success Story Using a Grievance Petition

Have you ever simply lent your name for a corporate CEO position as a favor to a friend, thinking, "What could go wrong?"

Imagine not making a single penny of profit, but one day suddenly receiving an astronomical comprehensive income tax bill for 100,000,000 won (100 million KRW) in your name.

Your mind would likely go blank, overcome with extreme fear and despair as if your life is collapsing. Overdue notices from the National Tax Service (NTS) arrive daily, your bank accounts get seized, and you may even face an overseas travel ban.

Hello, I am the lead business consultant at 'Dreams (Kkumdam)', a service dedicated to restoring your lost rights and your ordinary daily life.

Today, we will deeply analyze a shocking yet perfectly resolved real-life case of 'Canceling Comprehensive Income Tax Related to Name Lending'.

If you are currently suffering from sleepless nights as a tax defaulter burdened with a massive tax bill because you were unfairly registered as a nominal CEO, I am confident this post will be the lifeline that saves you.

1. How It Started: Japan Construction Co. and a 100 Million Won Tax Bill

Mr. A, the claimant in this case, couldn't refuse an earnest request from an acquaintance.

The tragedy began with a sweet yet irresponsible promise: "Just put your name down as the CEO for a little while. I'll handle all the company operations, and I guarantee absolutely no harm will come to you."

Consequently, Mr. A was registered as the paper CEO of Japan Construction Co.

However, reality played out entirely differently from the acquaintance's promise. The acquaintance, the actual operator, misappropriated company funds, failed to pay any taxes, and completely vanished.

As a result, the tax authorities deemed Mr. A, the CEO on paper, as the company's actual operator.

On July 5, 2025, a devastating tax notice was delivered to Mr. A's home, demanding the payment of 100,000,000 won in comprehensive income tax.

The Terrifying Butterfly Effect of Tax Arrears

Beyond the mere pressure of "having to pay taxes," once national tax arrears reach 100 million won, government agencies begin applying immediate and severe sanctions.

The pain Mr. A endured went far beyond simple financial loss.

• Complete Suspension of Financial Transactions: The National Tax Service immediately seized all commercial bank accounts under Mr. A's name. He became financially marginalized, unable to use even a basic debit card.
• Registered as a Credit Defaulter: After a certain period, his tax delinquency record was registered with the Korea Federation of Banks. Extensions for existing loans were denied, and late-payment interest snowballed at a terrifying rate.
• Overseas Travel Ban: Because the arrears exceeded 50 million won, the Minister of Justice issued a travel ban. Overseas business trips or family vacations became an impossible dream.

Mr. A suffered such severe psychological distress that he even had extreme thoughts, crying out, "I never took a single cent; why must my life be ruined like this?"

2. The Counterattack Begins: Securing a Court Ruling and Denying 'Actual Representative' Status

The tax authorities are not easily fooled. Empty claims like, "I only lent my name; I'm not the real boss" are absolutely never accepted.

Because there are tens of thousands of tax evasion attempts every year, the NTS only trusts 'objective and irrefutable documentary evidence'.

The very first thing Mr. A did to escape this hell was secure a court ruling through civil and criminal litigation.

Why is a Court Ruling the Most Powerful Weapon?

A court judgment represents the most authoritative and objective truth delivered by a state institution after an in-depth investigation and examination of evidence.

Mr. A filed a lawsuit against the acquaintance who was the actual operator of Japan Construction Co. After a fierce legal battle, the court acknowledged the following facts:

• The claimant, Mr. A, was not involved in the establishment or capital payment of Japan Construction Co. in any way.
• The actual operator exclusively managed core management tools, such as the corporate seal, OTP cards, and bank account passwords.
• There is no record of Mr. A receiving any salary, dividends, or any other form of economic benefit from the corporation.
• Mr. A never participated in decision-making processes such as signing important contracts, or hiring and firing employees.

The court ultimately issued a ruling stating, "It is explicitly clear that the claimant, Mr. A, is merely a nominal representative of Japan Construction Co. and not the actual operator (de facto representative)."

3. The Ultimate Weapon: Drafting and Submitting a Grievance Petition (Tax Appeal)

Getting a court ruling doesn't mean your taxes automatically disappear. To erase the arrears remaining on the NTS network, you must actively pursue administrative relief procedures.

Generally, tax appeals follow the steps of 'Objection - Appeal/Review - Administrative Litigation.' However, if the unfair circumstances are clear but the statutory appeal deadline has passed, you can utilize the 'Grievance Petition' system.

Core Logic for an Income Tax Grievance Petition

The logic of the grievance petition submitted to the competent tax office by experts like 'Dreams (Kkumdam)' on behalf of Mr. A must be highly precise and resolute.

It is not simply begging for mercy; it must assert that the tax assessment is 'fundamentally null and void' based on firm legal grounds.

Within these short sentences lies a highly crucial tax law principle: The 'Principle of Substance Over Form'.

4. Article 14 of the Framework Act on National Taxes: The 'Substance Over Form' Principle that Overturns Everything

While unfamiliar to ordinary people who don't know tax law, this is the most powerful legal weapon wielded by tax experts and attorneys.

The Principle of Substance over Form, stipulated in Article 14 of the Framework Act on National Taxes, states: "If the attribution of income, profit, property, act, or transaction subject to taxation is only nominal, and there is another person to whom it actually belongs, tax laws shall be applied by making the actual beneficiary the taxpayer."

To put it simply using an analogy:

Imagine you temporarily registered a car under your name as a favor to a friend. But then, that friend drives the car and commits a hit-and-run or gets caught on a speeding camera.

Naturally, the police station holds you, the registered owner on paper, accountable and sends you the fines.

But what if you can perfectly prove through dashcam footage or CCTV that "the person holding the steering wheel and pressing the gas pedal was my friend, not me"?

The fines and penalties are transferred to the actual driver, and you are cleared of all charges.

Taxes work exactly the same way. The paper representative (nominal owner) of Japan Construction Co. was Mr. A, but the court ruling proved that the person who actually managed the funds and took the profits (the actual beneficiary) was someone else entirely.

Therefore, the 100 million won comprehensive income tax levied on Mr. A was based on a false premise, making the assessment 'fundamentally null and void'.

5. The Grievance Committee's Decision: Complete Freedom from Tax Debt

When a grievance petition is submitted alongside powerful documentary evidence like a court ruling, the competent tax office convenes a Grievance Petition Deliberation Committee, led by a Taxpayer Advocate.

Here, external private-sector members (such as tax accountants, CPAs, and lawyers) participate to review the case highly objectively.

In Mr. A's case, because there was the irrefutable 'smoking gun' of a finalized court judgment, the deliberation swiftly moved in favor of the taxpayer.

Ultimately, the committee issued a citation decision, stating, "The 100 million won comprehensive income tax assessment against the claimant violates the principle of substance over form and is therefore unjust. Thus, it is canceled ex officio."

The Miraculous Changes Brought by Assessment Cancellation (Voiding)

This isn't just a simple tax reduction or installment plan. A 'cancellation' is a powerful administrative action that reverts everything to the state as if the tax was never levied in the first place.

• Complete Deletion of the Arrears Record: The 100 million won tax default record registered on the NTS network and the Federation of Banks was immediately and permanently deleted.
• Lifting of Seizures and Credit Restoration: The seizures on his frozen bank accounts were lifted, and he could use his credit cards again.
• Return to a Free Daily Life: The travel ban was lifted, restoring his freedom to travel overseas anytime.

Only then could Mr. A escape the hellish past two years, shedding tears of relief while embracing his family.

6. 'Practical Defense Guide' to Avoid Becoming the Next Victim

Some readers might think, "I would never do something so foolish."

However, name-lending happens very subtly, usually through the closest people (relatives, decade-long friends, senior/junior colleagues). The damage inflicted on young adults in their 20s or the elderly who fall for the temptation of "I'll give you a $2,000 allowance every month if you lend me your name" is beyond imagination.

If you unfortunately had your identity stolen or find yourself in an unfair situation, you must habitually collect the following evidence to defend yourself later.

7. Frequently Asked Questions (FAQ) - Top Questions from Naver Knowledge iN

I have compiled the most common questions asked by CEOs during countless consultations. Don't wander around the search bar; get your clear answers right here.

Q1. Can I not get my taxes canceled if I don't have a court ruling?

A court ruling is not strictly mandatory for a grievance petition to be accepted. However, without a ruling, you must collect tens or hundreds of pieces of 'objective circumstantial evidence' (as outlined in the table above) and persuade the NTS through highly logical storytelling. Because this process is practically impossible for the general public, the help of a professional is absolutely crucial.

Q2. Can I be criminally punished for lending my name?

Yes. Under the Punishment of Tax Evaders Act, anyone who registers a business under another person's name to evade taxes, or anyone who lends their name for this purpose, can face up to 1 year in prison or a fine of up to 10 million won. Therefore, when filing a grievance petition, clearly explaining the lack of intentional tax evasion is key.

Q3. I owe 100 million won in back taxes, but I don't have the money for a lawsuit. What should I do?

Proceeding with a formal trial (administrative litigation) comes with heavy time and financial constraints. That's why you must actively utilize the 'Grievance Petition' system explained today. Compared to a lawsuit, this is a highly cost-effective administrative procedure that offers relief within a relatively short period and at a lower cost (typically around 1 to 2 months).

8. Conclusion: Fighting Alone is Like Striking a Rock with an Egg, But It's Possible With Experts

For an ordinary individual to fight alone against a massive state institution like the National Tax Service is like David standing before Goliath.

Especially when facing a massive tax arrears bill of 100 million won, rational judgment clouds over, and wrong responses often make the situation worse.

Even if you shout "I'm not the real representative!" a hundred times, the NTS only speaks through documents and evidence.

If you find yourself trapped in unwanted massive debt due to a tax assessment linked to providing your name as a corporate CEO, just like the Japan Construction Co. case introduced today, do not hesitate.

It is not your fault. You simply trusted someone too much, that's all. The path to restoring your lost credit and returning to your normal life is undoubtedly open.