The year-end settlement, which is called the “13 month bonus,” is approaching one day ahead.
From the 15th, workers can inquire about income and tax credits at hometax at the National Tax Service. Hours of use are daily from 6 am to midnight. The connection is automatically terminated after 30 minutes of use time to prevent server overload on the 15th to 25th when the use is crowded. When the connection termination notice window pops up, save your work, disconnect, and then reconnect.
This year’s National Tax Service’s simplified service will include additional data on indemnity medical insurance premiums, glasses purchased with credit cards or cash receipts, monthly taxes paid to public rental housing businesses, and donations related to emergency disaster support. Hearing aids that are deductible but not automatically searched, disability security equipment, glasses paid in cash, and pre-school school expenses must be received by the employee and submitted to the company.
If the medical expense data is not inquired or is different from the facts, you can report it to the’Unchecked Medical Expense Report Center’ by the 17th.
The National Tax Service plans to additionally collect the details of the report from medical institutions and provide final confirmation data on the 20th.
Workers of companies who use the’convenient year-end settlement service’ can fill out a deduction report, submit data easily, and calculate the estimated tax amount from the 18th at Hometax.
From this year onwards, KakaoTalk, Payco, KB Kookmin Bank, three telecommunications companies PASS, and Samsung PASS can also search for data or apply for or cancel the consent of their dependents to provide data. However, private certificates can only be used on PCs.
Joint certificates (formerly accredited certificates and financial certificates), administrative digital signature (GPKI), and educational institution digital signature (EPKI) can be used on both PC and mobile devices.
This year, when purchasing eyeglasses or contact lenses for vision correction with a card or cash receipt, each worker or person eligible for the basic deduction can receive a tax deduction for medical expenses of up to 500,000 won per year. Tenants of public rental housing can inquire about their monthly rent in the’House Fund/Monthly Tax’ item of the Simplified Service.
This year, the credit card tax deduction will increase significantly depending on the usage period.
The income deduction rate, which was previously 15-40%, doubles for each user in March, and is applied upwards by 80% from April to July.
Credit card deductions also increase by 300,000 won each from 2 million, 2.5 million, and 3 million won, depending on the total salary segment. The amount used for traditional markets, public transportation, books, performances, museums, and art museums can receive an income deduction of up to 1 million won each, regardless of this limit. However, keep in mind that credit cards are eligible for deductions only if you use more than 25% of your total salary.
In addition, the establishment of tax exemption for spouse maternity leave, income tax reduction for excellent workers returning to Korea, and an increase of 30 million won exemption limit for stock option exercise profits from venture companies will also be applied from this year.
In particular, starting this year, one should be careful about penalties caused by’unfair deductions’.
First of all, the amount of medical expenses paid last year must be subtracted from the tax credit application. In the simplified service of the National Tax Service, you can check the payment details of insurance payments. If last year’s medical expenses were 1 million won and the insurance payments received 800,000 won, the deductible medical expenses would be 200,000 won. For example, if the amount of medical expenses expenditure was 1 million won in 2019 and 800,000 won in insurance payments were received in 2020, you must file a year-end settlement amendment report for the amount attributable to 2019 by the end of May this year, the deadline for filing the comprehensive income tax for the year in which the insurance was received. If the deadline for revised filing is exceeded, there is an additional tax charge.
In addition, if the amount of work, business, transfer, retirement, pension, finance, and other income of the spouse and dependents, excluding the worker himself, exceeds 1 million won (for those with only earned income, the total salary is 5 million won), the basic deduction for dependents shall not be received. . One of the many mistakes we make here is to apply for personal deductions without knowing that stocks and real estate are also included in the transferred assets.
There are many people who have jumped into stock investment due to the recent stock market boom. If the dependents earned more than 1 million won from stock investment last year, they should not receive personal deductions for their dependents during the year-end deduction period this year.
In the case of real estate transfer income, even if the transfer price minus the acquisition price, necessary expenses, and long-term holdings special deduction is 1 million won or more, additional tax is required when receiving personal deductions for dependents. In addition, even if the capital gains tax is reduced or exempted on self-cultivation farmland for more than 8 years, if the amount of capital gains is over 1 million won, it is not subject to personal deduction. However, in the case of housing, personal deductions are subject to sales and transfer tax-free benefits while satisfying the two-year living requirement.
Along with this, it is also one of the points to be aware that dual-income couples receive duplicate deductions for the same child, or siblings and siblings receive duplicate deductions for parents.
Financial experts said, “If workers receive excessive deductions by mistake during the year-end settlement, they must pay the amount obtained by multiplying the amount of underpaid tax or excess refund tax by the number of days passed and multiplying by 0.025% as the payment delay penalty tax.” He advised, “Because it could become a tax bomb in 13 months, special attention is needed.”
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