Last Year’s Corporate Tax Credit Amounted to 13.6 Trillion Won... Increased by 6 Trillion Won in 5 Years

National Tax Service, 2023 Q3 National Tax Statistics
SMEs Receive KRW 1.5 Trillion Tax Credit for 'Research and Workforce Development Expenses'
New Release of 'Living Industry Statistics'

The number of corporations reporting corporate tax credits and the amount of tax credits claimed last year have significantly increased compared to five years ago.

According to the "2023 Q3 National Tax Statistics" released by the National Tax Service on the 25th, the number of corporations reporting corporate tax credits and the amount of tax credits last year were 173,000 and 13.6 trillion KRW, respectively, representing increases of 193.2% (114,000 corporations) and 78.9% (6 trillion KRW) compared to five years ago. Corporate tax credits are amounts deducted from the calculated tax to prevent double taxation or for tax policy purposes.

By corporation size, the number of reporting corporations was 110,000 for small and medium-sized enterprises (SMEs), and the amount of tax credits increased by 4.1 trillion KRW for general corporations. In 2022, SMEs accounted for 91.9% of the number of corporations, and general corporations accounted for 73.5% of the tax credit amount.

Looking at corporate tax credits by category, SMEs claimed the most for research and human resource development tax credits (1.5 trillion KRW), followed by tax credits for companies that increased employment (1.2 trillion KRW), and integrated investment tax credits (300 billion KRW).

For general corporations, foreign tax credits (5.5 trillion KRW) were the largest, followed by research and human resource development tax credits (2.1 trillion KRW) and integrated investment tax credits (1.2 trillion KRW).

In 2022, the number of corporations reporting corporate tax exemptions was 245,000, and the amount of tax exemptions was 1.9 trillion KRW. Compared to five years ago, the number of corporations increased by 12.9% (28,000 corporations), while the amount of tax exemptions decreased by 17.4% (400 billion KRW). Corporate tax exemptions fully or partially exempt the calculated tax on income generated from specific businesses or assets.

By category, SMEs claimed the most for special tax exemptions for SMEs (1.1 trillion KRW), and general corporations claimed the most for tax exemptions for headquarters relocated outside the metropolitan area (300 billion KRW).

Corporate entertainment expenses reported last year amounted to 12.7 trillion KRW, an increase of 18.7% (2 trillion KRW) compared to five years ago. By industry type, manufacturing, service, and wholesale sectors ranked highest. SME entertainment expenses accounted for 71.7% of total corporate entertainment expenses.

In May this year, the National Tax Service released new statistics based on an analysis of data from the top 100 daily life industries over the past five years, aimed at helping prospective entrepreneurs and job seekers. In September, it will newly provide "Statistics on Daily Life Industries," a content service that allows easier and more useful access to sales levels by industry and region. Users can select the top 100 daily life industries or regions and input annual sales amounts to view statistics at a glance, including sales levels by industry and region, number of businesses, average business longevity, and demographic ratios by gender and age.

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