National Tax Service: "Public Interest Corporations Must Submit Donated Assets by the 31st of This Month"

Strict Verification for Public Interest Corporations Affiliated with Large Corporations and Those Accused of Noncompliance

[Asia Economy Reporter Kwangho Lee] The National Tax Service (NTS) announced on the 17th that public interest corporations with a fiscal year ending in December 2019 must submit reports on contributed assets and other documents, as well as external expert tax confirmation letters, to the relevant tax office by the 31st of this month. Simplified reporting is also possible through Hometax.

Additionally, public interest corporations with total assets of 500 million KRW or more, or with combined income and contributed assets of 300 million KRW or more, must disclose their financial statements and related documents on Hometax by May 4th.

If engaged in profit-making businesses, they must file and pay corporate tax on such businesses by the 31st, just like for-profit corporations.

The NTS plans to provide active tax administration support, including extensions of filing deadlines, for public interest corporations facing difficulties due to COVID-19 and other reasons.

Public interest corporations directly affected by confirmed COVID-19 cases or exposure will have their filing deadlines extended by three months ex officio, and those located in Daegu, Gyeongsan, Cheongdo, and Bonghwa?areas declared as special disaster zones?will have their deadlines extended by one month ex officio.

For public interest corporations experiencing operational damages that make timely filing difficult, extensions of up to three months will be granted upon application.

The NTS will provide enhanced filing support services so that public interest corporations can focus solely on their public activities. A specialized consultation team for public interest corporations handles support for new and small-scale public interest corporation filings, and tax guidance booklets and filing instruction videos are posted on the NTS website to assist with filing.

In particular, this year, the NTS is expanding the provision of self-check filing assistance services for items subject to gift tax penalties if tax obligations are not fulfilled, as well as pre-filled services that automatically populate previous filing data, to enable convenient and accurate filing.

Meanwhile, a new verification system has been established to closely examine whether public interest corporations suspected of non-compliance are fulfilling their tax obligations.

Comprehensive verification is conducted for public interest corporations affiliated with large conglomerates, and individual verifications are expanded to include non-affiliated public interest corporations with large asset or income scales suspected of non-compliance. Other general public interest corporations are subject to post-management focusing on items flagged by computerized analysis for potential tax evasion.

So far, verification results have uncovered various illegal cases such as public interest corporations not using contributed assets for public purposes, unjust hiring of related parties as executives or employees, and holding shares of related special corporations beyond the legal limit (5%) together with other public interest corporations in the same group.

An NTS official stated, "Going forward, we will strictly verify non-compliant public interest corporations, strengthen filing support services, and actively support public interest corporations in complying with tax obligations and conducting public projects in line with their founding purposes by discovering those that contribute significantly to social contribution and recommending them as exemplary taxpayers."

This content was produced with the assistance of AI translation services.