Even Those with Last Year's Rental Income Under 20 Million Won Are Subject to Income Tax Filing This Year

National Tax Service "Providing Maximum Reporting Assistance Service... Please File Electronically via Hometax"

[Asia Economy Reporter Kwangho Lee] Starting this year, individuals with housing rental income of 20 million KRW or less from the previous year must also file income tax returns.

The National Tax Service (NTS) announced on the 12th that from this year, in order to ensure fairness with other industries such as commercial rental and uphold the taxation principle that "taxes exist where income exists," income tax will be imposed on those with total revenue of 20 million KRW or less, and they must file by June 1.

Housing rental income is classified as taxable business income for income tax purposes. Even before 2013, housing rental businesses with total revenue of 20 million KRW or less were subject to taxation. However, to temporarily resolve supply-demand mismatches in the rental market, housing rental income of 20 million KRW or less was exempted from taxation only for the income years 2014 to 2018.

The filing requirement applies to owners of two or more houses with monthly rent income and owners of three or more houses whose total deposit amount exceeds 300 million KRW. The number of houses is calculated by combining those owned by spouses, and monthly rental income from houses with a standard market price exceeding 900 million KRW or houses located overseas is taxable even for single-house owners.

The NTS will send customized guidance letters according to taxpayer types and provide as much information as possible necessary for filing, such as housing ownership details, tax office and local government registration information, in the guidance letters.

A new housing rental income filing guidance page has been created, posting tax-saving tips, frequently asked questions and answers, and more.

Additionally, services such as electronic filing tutorial videos, comparison of estimated tax amounts for comprehensive and separate taxation, and a simple calculation service for deemed rental income are also provided.

An NTS official stated, "To prevent the spread of the novel coronavirus (COVID-19), we ask taxpayers to refrain from visiting tax offices and to file remotely through Hometax. Using Hometax allows for easy filing with a pre-filled return without the need to manually enter the location of the rental property."

He added, "After filing, tax audits will be conducted on those who file insincerely, so we ask for sincere reporting."

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