Retroactive Application for Houses Acquired After June 21, 2022
Gwangyang City in Jeollanam-do announced that with the enforcement of local tax-related laws starting from the 14th, first-time homebuyers can receive an acquisition tax reduction of up to 2 million KRW.
This revised law includes the expansion of the tax reduction system announced by the government as part of the real estate policy normalization tasks at the Real Estate Ministers' Meeting on June 21, 2022.
This system aims to support housing for young people and reduce the tax burden on low-income real demand buyers. Previously, the reduction applied to couples with a combined annual income of 70 million KRW or less and a real transaction price of 300 million KRW (400 million KRW in the metropolitan area) or less. However, with the amendment to the Local Tax Special Cases Act, the income criterion has been removed, and if the actual transaction price of the house is 1.2 billion KRW or less, the full amount up to 2 million KRW will be exempted.
The reduction applies retroactively to taxpayers who acquired a house after the government’s policy announcement date of June 21, 2022, and meet the reduction requirements.
To receive the reduction, applicants should check the announcements on the Gwangyang City website and, if both spouses are eligible, submit the reduction application form, refund application form, and family relation certificates of both the acquirer and spouse by visiting or mailing them to the Taxation Division of Gwangyang City Hall.
However, the acquirer must move their residence and actually live in the house within three months from the acquisition date. If the house is sold, gifted, or another house is additionally acquired within three months while residing for less than three years, the tax may be reclaimed, and the reduction may be excluded.
Additionally, due to delays in extending the sunset clause, acquisition tax reductions for hybrid vehicles and real estate related to industrial complexes, which were not applied, can also be retroactively applied from January 1, 2023.
Lee Kang-gi, head of the Taxation Division, said, “We will promptly and accurately process acquisition tax refunds so that citizens do not miss out on tax reduction benefits due to unawareness of the law amendment,” and added, “We will continue to make more meticulous efforts to protect taxpayers’ rights and improve convenience.”
Asia Economy Honam Reporting Headquarters, Reporter Heo Seon-sik hss79@asiae.co.kr ［
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