675 Union Financial Disclosures... Tax Credits Require Public Disclosure of Settlement Results

From the 1st of next month for 2 months

Labor unions with more than 1,000 members must disclose last year's financial settlement results between March and April to receive tax deductions on this year's union dues.

The Ministry of Employment and Labor announced on the 26th that it will operate the union financial disclosure period for two months from April 1 to April 30.

The union financial disclosure system was implemented last October to establish transparent union accounting practices. Following the decision of the two major federation organizations last year to participate in financial disclosure, 675 out of 739 unions and subordinate organizations with more than 1,000 members (91.3%) will disclose their settlement results.

Whether the entire tax deduction for union dues for the year 2024 will be granted depends on this financial disclosure.

The government plans to improve the convenience of the electronic system, provide on-site and video training, and distribute manuals to ensure the voluntary establishment of union financial disclosure this year.

Additionally, programs such as expert accounting consulting, support for external audit costs, and practical training for accounting auditors will be operated to strengthen labor unions' capabilities in transparent financial and accounting management.

Unions wishing to disclose their financial statements can access the union financial disclosure system within the comprehensive labor administration information network, ‘Labor Portal,’ and enter last year's settlement results.

Minister Lee Jeong-sik stated, "We will support the union financial disclosure, now in its second year, to further enhance the transparency and reliability of unions."

The government has amended the Enforcement Decree of the Income Tax Act so that unions with more than 1,000 members that do not disclose their financial statements will not be eligible for a 15% tax deduction on union dues (30% for amounts exceeding 10 million KRW). Furthermore, if the upper-level organization does not disclose, subordinate organizations cannot receive tax deductions regardless of their own disclosure status.