[Gi Ha-Young's Life Card] Increased Property Tax Burden, Pay with Card Company Benefits

2-8 Months Interest-Free Installment Benefits
Also Cashback and Coffee Coupon Benefits

Is there anyone these days without at least one credit card? In modern society, anyone can have a card if they want. Credit cards have brought unparalleled convenience to daily life. Now, wherever you go, you can easily see people paying with credit cards or smartphones. As demand has increased, cards with various benefits are being released almost daily. Accordingly, Asia Economy delivers various stories related to cards, which are inseparable from our consumer life, through the weekly 'Cards in Daily Life' corner, ranging from introductions of new cards, industry behind-the-scenes stories, to guides for card beginners.

[Image source=Yonhap News]

July is the month for property tax payment. Property tax is a tax imposed in July and September on owners of land, buildings, houses, aircraft, and ships based on ownership as of June 1 each year. In July, 50% of the property tax on houses (with the full amount for tax amounts under 200,000 KRW) and taxes on buildings, aircraft, and ships are levied, while in September, the remaining 50% of house tax and land tax are imposed.

Recently, as real estate prices have risen significantly, the burden of property tax has also increased. Because of this, more people are paying property tax with credit cards to reduce their tax burden.

Card Companies Offer 2 to 8 Months Interest-Free Installment Plans

Property tax can be paid via dedicated accounts through account transfers or bank ATMs, but by using card company benefits, it is possible to pay in installments interest-free, and depending on the card company, you can receive cashback or coffee coupons. Especially for local taxes like property tax, unlike national taxes (0.5% for check cards, 0.8% for credit cards), there is no payment agency fee charged to taxpayers.

Currently, most card companies are running interest-free installment events for national and local taxes ranging from 2 to 8 months or partial interest-free installment events. The details vary by card company. For individual credit cards (excluding corporate and prepaid cards), NH Nonghyup Card offers 2 to 8 months, Hyundai and Woori Cards offer 2 to 7 months interest-free installments. Shinhan, Samsung, KB Kookmin, and Hana Cards provide 2 to 6 months interest-free installments. Some card companies also offer partial interest-free installment benefits for 10 or 12 months by reducing some installment fees.

Cashback and Coffee Coupons Depending on Payment Amount

In addition to interest-free installment benefits, some card companies provide cashback or coffee coupons. KB Kookmin Card offers a Starbucks cake and coffee coupon if you pay 500,000 KRW or more in property tax in a lump sum with a credit card by August 2. During the same period, if you pay a total of 200,000 KRW or more in local taxes with a check card, you will receive a Starbucks iced Americano coupon. To receive these benefits, you must apply for the event through the website or customer center. Also, if you pay with a check card linked to a KB Kookmin Bank account, you can earn 0.2% of the payment amount as Pointree points.

Shinhan Card offers a 0.17% cashback in cash for local tax payments made with a check card until the end of this month. However, if the cash cashback amount is less than 10,000 KRW, it will be credited as My Shinhan Points. Samsung Card provides up to a 30,000 KRW payment day discount depending on the payment amount when paying national taxes with eligible cards via the 'National Tax Benefits' link on the website or application (app) LINK page.

Hyundai Card and Woori Card are also running cashback events for specific customer groups. Hyundai Card offers up to 10,000 M Points, and Woori Card provides up to 70,000 KRW cashback depending on the average monthly usage. However, these benefits are limited to customers who received event target text messages. Lotte Card is also running an event until the 31st, giving one Starbucks coffee coupon to customers who pay 700,000 KRW or more in local taxes and apply for the event.

Tax Payment Card Usage Does Not Count Toward Previous Month’s Spending Requirements

Paying taxes by card allows you to split large amounts without fees, but most card benefits do not include tax payments in the previous month’s spending requirements. For example, if a credit card offers 30,000 KRW cashback when the previous month’s spending is over 500,000 KRW, even if you pay 500,000 KRW in property tax with that card this month, you must spend another 500,000 KRW elsewhere to qualify for the cashback. Whether tax payments count toward previous month’s spending varies by card, so it is necessary to check, but most card companies explain that tax payments are excluded from previous month’s spending requirements.