📅 2025-01-03
A must-know for freelancers, business owners, and those with income beyond salary! Learn everything from filing methods to tax-saving tips.
Comprehensive income tax is imposed on all income earned during the year (previous year Jan 1-Dec 31). Subject income: Interest, dividends, business, employment, pension, other income. File and pay May 1-31 annually. Progressive tax rate of 6-45% applies based on tax base.
① Self-employed individuals with business income (including freelancers). ② Employees receiving salary from 2+ places. ③ Those with income other than salary (rental, interest, etc.). ④ Employees who did not do year-end tax settlement. ⑤ Those with retirement/pension income. Regular employees who only did year-end settlement need not file separately.
Income deduction: Reduces tax base. Examples: Personal deduction (1.5M KRW for self, spouse, dependents each), pension insurance, housing funds, credit card usage. Tax credit: Directly deducted from calculated tax. Examples: Employment income tax credit, child tax credit, pension account tax credit, donation tax credit. Tax credits have greater tax-saving effect.
① Access Hometax and login. ② Select "Comprehensive Income Tax Filing" menu. ③ Create regular filing (choose simple expense rate/standard expense rate/simple books/double-entry bookkeeping). ④ Enter income and expenses. ⑤ Enter income deduction and tax credit items. ⑥ Confirm tax amount and submit filing. ⑦ Confirm payment or refund. Tax agent (accountant) use also possible.
① Thoroughly collect expense receipts (tax invoices, card receipts). ② Reflect all income deduction items (pension savings, IRP, donations, etc.). ③ Actively use business credit cards. ④ Maximize family personal deductions. ⑤ Check SME employee income tax reduction. ⑥ Join Yellow Umbrella Insurance. ⑦ Medical/education expense tax credits.
Non-filing: Non-filing penalty (20%), late payment penalty (0.025%/day). Underreporting: Underreporting penalty (10-40%). Refund: Refunded if prepaid tax (withholding) exceeds determined tax. Refund paid within ~30 days after filing. Additional refund possible through amended return (within 5 years).
Conclusion: Comprehensive income tax filing seems complex, but relatively easy with Hometax. Maximize income deductions and tax credits, avoid penalties with accurate filing. Recommend accountant consultation for complex cases.