National Tax Service Introduces 'Pre-Review System for Research and Human Resource Development Tax Credit'

[Asia Economy Reporter Kwangho Lee] The National Tax Service announced on the 13th that it will implement a system this year to pre-verify the appropriateness of tax credits for Research and Development (R&D) expenses.

Domestic corporations and residents who wish to receive a pre-review of their R&D tax credits can apply through Hometax, mail, or in-person submission before filing their corporate tax (income tax) base declaration.

Pre-review applications can be made not only for expenses already incurred but also for planned expenditures.

The review examines whether the research and development activities conducted by the applicant meet the requirements stipulated in the tax law and whether the expenses qualify for tax credits, with the process primarily conducted through written examination.

If the applicant files their corporate tax based on the pre-review results, they will be exempt from being subject to declaration verification, and if the tax assessment differs from the review results afterward, the underreporting penalty tax will be waived.

The National Tax Service stated, "We will actively support faithful reporting by collecting opinions on the system operation in the future and publishing a review casebook."

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