Partial Errors in Comprehensive Real Estate Tax Notices for Reconstruction Housing in Gangnam and Others... National Tax Service to Issue Refunds

Notification Letters to Be Sent from the 25th to Taxpayers with Possible Notice Errors
Errors Such as Incorrect Housing Acquisition Dates Affecting Long-term Holding Tax Credits

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[Sejong=Asia Economy Reporter Kim Hyunjung] Errors have been identified in the comprehensive real estate tax (종부세, Jongbu-se) notices for some reconstruction and redevelopment housing in areas such as Gangnam, Seoul, prompting the National Tax Service (NTS) to proceed with corrections and refunds. These errors involve incorrect input of housing acquisition dates, resulting in long-term holding tax credits not being properly applied. The NTS has stated that if taxpayers report these errors, the notices will be corrected and any overpaid taxes will be refunded.

According to the NTS on the 25th, notification letters will be sent from this day to taxpayers who may have errors in their notices related to reconstruction and redevelopment housing. For such housing, the holding period should be calculated based on the acquisition date of the original house, but if the house name or address changes, the holding period may be calculated based on the acquisition date of the newly constructed house, leading to issuance of incorrect notices. This causes the one-household-one-home long-term holding tax credit to be improperly applied, resulting in higher tax amounts than correctly calculated.

The NTS conducts internal checks before issuing notices to prevent this, but due to limited time and information, a full inspection is not possible, making some notice errors unavoidable each year. Last year, the NTS processed refunds for 428 cases of notice errors amounting to about 300 million KRW for the 2015?2019 tax years.

This year, with rising house prices and tax rates significantly increasing 종부세 amounts and taxpayer interest, the NTS plans to prioritize sending notification letters to taxpayers with possible notice errors and explain the subsequent procedures. If taxpayers discover errors and report them to their local tax office, the tax office chief can correct the notice ex officio.

Taxpayers can also correct the information through voluntary reporting during the 종부세 filing and payment period from the 1st to the 15th of next month, or file an objection within 90 days after receiving the notice. After the reporting period ends, the NTS will conduct its own review and process bulk refunds for any notice errors that taxpayers have not corrected.