Last Year, 2,100 Companies Incorrectly Reported 140 Billion KRW in Corporate Taxes

NTS Urges Corporations to Review "Reporting Assistance Materials" Before Filing
Mistakes May Lead to Additional Penalties

Last year, 2,100 corporations incorrectly reported corporate taxes amounting to 140 billion KRW. Caution is required as additional penalties may be imposed if tax credits or exemptions were excessively claimed due to errors such as miscalculating the number of eligible employees or exemption targets.

On the 27th, the National Tax Service (NTS) announced that it plans to provide various reporting assistance materials and maximize reporting convenience to help ensure accurate corporate tax filings.

First, the NTS will provide customized reporting assistance materials tailored to each corporation’s characteristics through the Hometax system for corporations with December fiscal year-ends preparing for the March corporate tax filing.

This year, the assistance materials have been expanded to include items such as health insurance premium payment details and the conversion of tax bases for corporations with fiscal years shorter than one year. Detailed transaction information, including locations and transfer dates of non-business-use land and houses, has been provided to enhance the usability of the reporting assistance materials.

For companies that have increased employment, up to this year’s filing, they can apply either the existing employment increase tax credit and social insurance premium tax credit or the newly established integrated employment increase tax credit starting from the 2023 tax year. To allow corporations to choose the more advantageous credit system between the two methods, the NTS has posted a tax credit simulation program on its website.

Through verification of last year’s filings, the NTS confirmed that 2,100 corporations incorrectly reported taxes amounting to 140 billion KRW. Common errors included excessively claiming tax credits or exemptions due to miscalculations of exemption targets or the number of regular employees, or failing to annualize the tax base to 12 months for fiscal years shorter than one year.

An NTS official stated, "If taxpayers make mistakes in their filings, they must pay not only the originally due corporate tax but also additional penalties. Reflecting the reporting assistance materials provided by the NTS can reduce the burden of these penalties."

After corporations submit their filings, the NTS will conduct detailed analyses to verify whether the reporting assistance materials were reflected and whether credits and exemptions were appropriately applied. Corporations that file inaccurately or insincerely will be dealt with strictly. In cases involving large amounts of tax evasion or where further fact verification is necessary, the cases will be escalated to tax audits for rigorous examination.