Interest Rate Applied to Imputed Rent Calculation for Jeon-Wolse Deposit Lowered to 1.2% Per Year

Telemarketers and Tourism Service Workers... Expansion of Night Work Allowance Tax Exemption Targets

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[Asia Economy Reporter Jang Sehee] When taxing jeonse deposits, the interest rate used as the standard for deemed rental income will be lowered to reflect market interest rates.

The Ministry of Economy and Finance announced the "Amendment to the Enforcement Rules of the Tax Law" on the 9th, which includes this content. This amendment is a follow-up measure to the 2020 tax law revision.

First, the interest rate applied when calculating deemed rental income on real estate rental deposits will be reduced from the current 1.8% per annum to 1.2% per annum. This reflects the recent trend of declining interest rates at commercial banks.

Deemed rental income is the amount taxed by considering the income generated from jeonse and monthly rent deposits as rental income, and value-added tax and income tax are levied on the interest equivalent of the rental deposit.

The scope of simplified taxation will also be significantly expanded. Industries such as wallpapering, interior decoration, portrait photography, plumbing, and heating/cooling construction will now be eligible for simplified taxation.

Non-taxable night work allowances will include telemarketers, product rental workers such as water purifier rental staff, tourism service workers, and simple labor workers related to housekeeping. Previously, this applied only to some service workers such as hairdressers, lodging facility employees, and cleaning labor workers.

The duty-free standards for personal effects of international trade aircraft crew and international trade ship crew have been upgraded from the existing Korea Customs Service notice to the Korea Customs Service enforcement rules.

The duty-free standard for international trade aircraft crew remains the same as before: a basic duty-free amount of USD 150, plus one bottle of duty-free alcohol and 200 cigarettes. For international trade ship crew, the basic duty-free amount ranges from USD 90 to 270 depending on the navigation period, plus one bottle of duty-free alcohol and 200 cigarettes.

Meanwhile, the scope of new growth technology commercialization facilities eligible for preferential tax credit rates during corporate tax credit has been expanded from the current 141 items in 10 fields to 158 items.

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