In this blog post, we will explore the important aspects of bookkeeping and the submission of a statement of payment in relation to income tax in Korea. Keeping of and Entry in Books (Article 160, Income Tax Act) As per the Income Tax Act in Korea, it is mandatory for all business operators to maintain supporting documents to calculate the amount of taxable income. These supporting documents sho..
In this blog post, we will explore penalty taxes and late payment fees related to income tax in Korea. Understanding these penalties is crucial for residents to avoid unnecessary financial burdens. Penalty Tax on Non-filing or Incorrect Filing If a resident in Korea, who is obligated to file an income tax return, fails to do so within the due date or under-reports their income, they will be subj..
In Korea, taxpayers are required to file and pay income tax on their global income by the designated due date for filing income tax returns. Additionally, residents with global income must make interim prepayments of income tax to the relevant authorities. In this blog post, we will explore the key aspects of income tax filing, interim prepayment, and the final return process for global income i..
In Korea, the calculation of global income tax is based on the taxpayer's income and is determined by applying the appropriate tax rates to the tax base. Additionally, taxpayers may be eligible for tax credits, which allow them to deduct specific amounts from their calculated income, subject to meeting certain requirements under the Income Tax Act and the Restriction of Special Taxation Act. Tax..
Foreign Tax Credit allows Korean residents to offset the tax paid or payable on foreign source income in a foreign country against their global income tax amount in the taxation period. This credit can also be included as necessary expenses when calculating the income amount accrued during the period, but this method is applicable only to business income. Scope of Deductibility Foreign source in..
Under the Restriction of Special Taxation Act (Article 126-2), certain individuals in Korea can benefit from income deductions based on the amount spent using credit cards, debit cards, and cash receipts. The deductions apply to residents with wage and salary income, their spouses with an annual income of not more than 1 million won, and their lineal descendants and ascendants with an annual inc..