Final VAT Filing Due by January 26... Small Business Owners Can Pay Until March 26

All businesses engaged in value-added tax (VAT) taxable activities must file and pay VAT for the relevant taxable period by January 26. For small business owners in wholesale, retail, food service, and accommodation industries, the payment deadline is extended to March 26. However, filing must be completed by January 26.

According to the National Tax Service on January 8, the number of taxpayers required to file VAT for the second period of 2025 is 8.07 million individual business owners and 1.34 million corporate businesses, totaling 9.41 million. This is an increase of 140,000 compared to last year’s final filing (9.27 million).

The taxable period for filing is from July 1 to December 31, 2025 for general individual taxpayers, and from January 1 to December 31 for simplified taxpayers. For corporate businesses, if a preliminary filing was made, the period is from October 1 to December 31; if not, it is from July 1 to December 31.

For this final filing, the National Tax Service will, without requiring an application, automatically extend the payment deadline by two months (until March 26) for business owners whose sales have decreased, in order to ease the financial burden on small business owners experiencing operational difficulties due to delayed economic recovery.

To qualify for the automatic extension, the business must have annual sales of 1 billion KRW or less in 2024 and operate in one of eight industries closely related to daily life: manufacturing, construction, wholesale, retail, food service, accommodation, transportation, or services. The business must also have seen sales in the first half of last year (January to June) decrease by 30% or more compared to the same period the previous year. For simplified taxpayers, regardless of sales decrease, the VAT payment deadline is extended by two months for all businesses except real estate leasing.

A National Tax Service official stated, "The automatic extension applies only to the payment deadline, so filing must still be completed by the deadline (January 26). A mobile notification will be sent separately to those eligible for the extension," adding, "Other business owners who are experiencing operational difficulties may apply for a payment extension and receive support for up to nine months."

The National Tax Service is providing a variety of guidance materials through the 'Filing Assistance Service' to help prevent mistakes and support accurate filing by business owners. In addition, by analyzing internal and external data and tax base information (such as electronic tax invoices, credit card transactions, and cash receipts), the agency will provide customized guidance materials tailored to each industry to an additional 1.23 million businesses.

Filing can be done using Hometax (PC) or Sontax (mobile). If there are no business transactions, filing can also be completed by phone. After filing, the National Tax Service will conduct a detailed review of the filing contents based on the guidance materials, and will collect any underpaid taxes from those suspected of inaccurate filing. Last year, the agency reviewed filings from 2,700 businesses that had incorrectly filed VAT and collected an additional 42.7 billion KRW in taxes.