"Up to 1 Million KRW Deduction"... Year-End Tax Settlement Newlyweds' 'Must-Know Tips' Not to Miss

NTS Announces One-Point Year-End Tax Settlement Guidance
for Newlyweds
Up to 1 Million KRW in Tax Credits for Couples Registering Marriage by 2026
Important Tips on Deductions for Childbirth, Postpartum Care, and Spousal Income

The National Tax Service (NTS) will provide a tax credit benefit of up to 1 million KRW to couples who register their marriage by 2026.

According to the National Tax Service, couples who register their marriage from 2024 through next year can each receive a tax credit of 500,000 won with their registered spouse.

On the 20th, the NTS summarized frequently asked questions related to year-end tax settlement for newlyweds. According to the guidance, couples who register their marriage from 2024 through next year can each receive a tax credit of 500,000 KRW with their registered spouse. This benefit is available only once in a lifetime.

If expenses are expected to exceed the usual amount and reach the income deduction limit for credit cards, etc., the NTS explains that spending under the name of the spouse with the higher total salary will increase the benefit. However, since the amount spent on credit cards and similar must exceed 25% of total salary, depending on the scale of expenses, it may be advantageous to spend under the name of the spouse with the lower annual income.

Reference photo to aid understanding of the article. Pixabay

It is also important to claim postpartum care center fees, childbirth tax credits, and tax exemptions on childbirth support funds. Simplified data for spouses with income exceeding 1 million KRW in the first half of last year will be completely blocked. Spouses who have only non-taxable income, such as parental leave pay under the Labor Standards Act, are eligible for basic deductions. Additionally, if the spouse consents to provide simplified data, insurance premiums, medical expenses, and donations of the spouse can be verified and used during year-end tax settlement.

The NTS stated, “Starting from this year’s year-end tax settlement, to prevent errors in dependent deductions, simplified data provision will be completely blocked if the spouse’s income amount in the first half of 2024 exceeds 1 million KRW (or total salary of 5 million KRW if only earned income).” However, “medical expenses, which are deductible regardless of income limits, and education expenses and insurance premiums, which can be deducted until the occurrence of reasons such as employment even if income criteria are exceeded, will all be provided.”

For detailed guidance, please refer to the year-end tax settlement comprehensive guide on the NTS website or check 24/7 through the National Tax Consultation Center’s artificial intelligence (AI) consultation service.

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