Acquisition Tax

Object of Taxation

• Real estate (land, building), vehicle, machinery, ship, airplane, growing tree, fishing right, mining right, membership

Taxpayers

• Those who acquire objects of taxation or perform the acquisition (including structural change of vehicle or change of land category)
  • - Oligopolistic shareholder (it is considered to acquire the assets of a company when over 50% of equity of that company is acquired).

Tax Rate

• General Tax Rate: 4%
  • - Inheritance Tax: 2.8% (2.3% for farmland)
  • - Paid housing transactions (contract of sale, etc.): 1–3%
  • - Gift Tax: 3.5%
  • - Original Acquisition Tax (including new construction): 2.8%
  • - Non-business vehicle: 7%
  • - Commercial vehicle: 4%
  • - Light car: 4%
  • - Two-wheeled vehicle (below 125cc): 2%

• Heavy Tax Rate
  • - Luxury property including vacation home, golf course, luxury entertainment facilities, deluxe houses: standard tax rate + 4 times the heavy tax rate (2%)
  • - Real estate for head offices of companies in big cities or new plants for expansion: standard tax rate + 2 times the heavy tax rate (2%)
  • - Paid housing acquisitions (multi-house homeowners): 8–12%
  • - Free housing acquisitions (subject to excess burden of taxation): 12%

Payment of Tax

• Report and payment within 60 days from the date of acquisition or before registration of the property
  • - Penalty for non-filing (20%) in the case of no payment within 60 days and failure-to-pay penalty (number of days in arrears x 3/10000).
  • - Penalty for underpayment (10%) and failure-to-pay penalty (number of days in arrears x 3/10000) in the case of the underreporting.
  • - Penalty for non-filing and penalty on underpayment (40%) in the case of no report or underreporting by fraud or illegal action.

Accompanied Taxes

• Special tax for rural development : 2% of acquisition tax x 10%, reduced acquisition tax x 20%
• Local education tax : acquisition tax minus 2% x 20%

Registration Tax

Objects of registration tax

• Registration of changes in rights including property rights in official registrars

Taxpayers

• Those who register such changes in official registrars

Tax Rate

Tax Rate

Divide			Tax Rate
Real Estate	Preservation of ownership (no acquisition required)		0.8%
	Transfer of ownership (no acquisition required)	Paid	2.0%
		Unpaid (inheritance)	1.5% (0.8%)
	Including superficies, mortgage, easement or leasehold right		0.2%
	Including biding, provisional seizure, provisional disposition or provisional registration		0.2%
	Miscellaneous		6,000 KRW
Ship	Preservation of ownership (no acquisition required)		0.02%
	Miscellaneous		15,000 KRW
Vehicle	Settlement of mortgage		0.2%
	Miscellaneous		15,000
Machinery	Registration of ownership		1.0%
	Settlement of mortgage		0.2%
	Miscellaneous		10,000 KRW
Plants/Mining Foundation	Acquisition of mortgage		0.1%
	Miscellaneous		9,000 KRW
Corporate Registration	Including establishment or increase of capital		0.4%
			0.2% for non-business entity
	Reassessment of assets		0.1%
	Movement of head office or main office		112,500 KRW
	Movement of branch or office		40,200 KRW
	Miscellaneous		40,200 KRW
Registration of trade names and other	Including establishment of trade name		78,700 KRW
	Appointment of managers		12,000 KRW
	Ship managers		12,000 KRW
Mining Right	Establishment		135,000 KRW
	Change (increase/decrease)		66,000 KRW
	Change (decrease)		15,000 KRW
	Transfer (inheritance)		26,200 KRW
	Transfer (other than inheritance)		90,000 KRW
	Miscellaneous		12,000 KRW
Fishing Right	Transfer (inheritance)		6,000 KRW
	Transfer (other than inheritance)		40,200 KRW
	Transfer of equity (inheritance)		3,000 KRW
	Transfer of equity (other than inheritance)		21,000 KRW
	Miscellaneous		9,000 KRW
Copyrights and other	Inheritance		6,000 KRW
	Other than inheritance		40,200 KRW
	Registration according to Computer Program Protection Act (other than inheritance)		20,000 KRW
	Miscellaneous		3,000 KRW
Patents and other	Transfer (inheritance)		12,000 KRW
	Transfer (other than inheritance)		18,000 KRW
Trademarks/Service	Establishment & update		7,600 KRW
	Transfer (inheritance)		12,000 KRW
	Transfer (other than inheritance)		18,000 KRW
	Miscellaneous		12,000 KRW

Payment

• Report and payment before registration.
  ※ The same penalty regulations as the acquisition tax are applied.

Accompanied Taxes

• Local education tax : Registration tax x 20%

Property Tax

What is Property Tax?

• Property tax is imposed on those who have won land, houses, structures, ships or airplanes as of June 1 every year (Tax base date).

Tax Assessment Standards

• The tax assessment standards for property taxes on land, structures or houses are determined by multiplying the fair market price ratio specified by the Presidential decree within the scope specified in any one of following items to the standard value of real estate based on the current price in consideration of the tendencies in the real estate market and local finances.
  • - Houses : 60% of the house price publicized by the Public Notice of Values and Appraisal of Real Estate Act.
  • - Structure : 70% of the value estimated by multiplying a variety of indexes to the standard value of building by new construction.
  • - Ship/Airplane/Other Taxable Objects: The value determined by the borough mayor in accordance with the standards specified by Presidential Decree
  • - Land: 70% of the publicly notified individual land price by the Public Notice of Values and Appraisal of Real Estate Act.

Tax Rate

• Tax rates vary on taxable objects. Contact the Tax Department in the relevant borough office for more details.

Payment Deadline

Payment Deadline

July 16~31	50% of a house price	Structure/Ship/Airplane	When the tax amount for property related to a house is less than 200,000 KRW, the total amount is invoiced in July.
Sep. 16~30	50% of a house price	Land

- Obligation of registration: Any change in property needs to be reported to a mayor, governor or a borough mayor in the competent authority where the relevant property is located within 10 days from the tax base date (June 1).

Gross Real Estate Tax Payment

• Taxpayers : Those whose total publicly notified individual (corporate) land price exceeds 600 million KRW for houses (1.1 billion KRW for those who have one house as one household), 500 million KRW for land subject to general aggregate tax and 80 million KRW for land subject to special aggregate tax.
• Payment deadline : Payment using the tax invoice from Dec. 1 to 15.
• Inquiry and counseling
  • - General inquiry: National Tax Service website (www.nts.go.kr)
  • - General counseling : National Tax Service Semirae Call Center (126 without telephone extension number).

Resident Tax

What is the Resident Tax?

• It is divided into an individual portion levied on individuals with an address registered with the local government, a corporate portion reported by an individual and corporate business owner who has a place of business registered with the local government, and an employee portion reported by an employer who pays salaries.

Taxpayers

• Individual: Individual head of household with an address registered with the local government, July 1 of each year
• Corporate: Individual and corporate business owners with business offices registered with the local government, July 1 of each year
• Employee: Employers of business establishments (with regular and non-regular employees) whose total monthly average salary exceeds 150 million won over the period of the last 12 months, including the current month.

Payment Period

• Individual: Annual tax base date - standard collection
• Corporate: - Payment upon declaration
• Employee: The 10th of the month following the month in which the salary is paid

Tax Rate

• Individual: 10,000 won KRW
• Corporate (basic tax rate + tax rate for total floor area)
• - Basic tax rate
• · Individual Business (exceeding 48 million won based on the value tax imposed in the immediately preceding year): 50,000 won
• · Corporation: 5-200,000 won depending on the capital
• - Tax Rate for Gross Surface Area
• · If the total surface area of the business office exceeds 330㎡, 250 won per 1㎡. (However, the amount is doubled for establishments that create pollution.)
• Employee: The total amount of salary paid to the employees for the month x 0.5%

Automobile Tax

What is the Automobile Tax?

• The automobile tax on the ownership of automobiles is a local tax and is a property tax imposed on the ownership of automobiles and a shared tax related to the usage and damage of roads and environmental pollution.

Taxpayers

• Automobile owners as of June 1 or Dec. 1, the tax base dates.

Tax Assessment Standards

• Engine displacement, number of seats, load capacity

Tax Rates

• Tax rates vary depending on automobile categories including cars, vans, trucks, special automobile and compact cars with less than 3 wheels. For more details, please contact the tax department in the competent borough office.

Payment Deadline

Payment Deadline

Period	Tax Base Date	Deadline	Taxation Period
1st Period	June 1	June 16~30	Jan. ~ June
2st Period	Dec. 1	Dec. 16~31	July ~ Dec.

Lump sum Payment and Installment Payment

• Those who apply for the installment payment can pay the annual automobile tax in installments, four times a year.
  • - 50% of the automobile tax for the first period shall be paid between March 16 and 31.
  • - 50% of the automobile tax for the second period shall be paid between Sep. 16 and 30 by installment payment. Therefore, the automobile tax can be paid in March, June, Sep. and Dec. in installments.
• Lump sum payment of annual automobile tax can be paid until the payment deadline below after deducting 10/100 of annual automobile tax (meaning the annual automobile tax for the period after the payment deadline of lump sum amount of annual automotive tax).
  • - Payment in Jan. : Jan. 16~ 31
  • - Report during the installment payment period : March 16~31/Sep. 16~30
  • - Report and payment during the first payment period : June 16 ~ 30