Career Break Returnees Also Eligible for "SME Employee Tax Reduction"... "Don't Miss Year-End Tax Deductions"

Basic Deductions Available for Spouses Who Received Parental Leave Benefits
Undeducted Donations Can Be Carried Forward and Deducted for 10 Years
Residential Officetels Also Eligible for Monthly Rent and Housing Loan Deductions

If you resigned due to marriage, childbirth, or childcare and were re-employed at a small or medium-sized enterprise (SME), you may be eligible for an income tax reduction for SME employees. Spouses who received parental leave benefits and children who received work-study scholarships are also eligible for basic deductions during year-end tax settlement, and any unused donation deductions can be carried forward and claimed for up to 10 years.

On January 20, the National Tax Service announced a list of "easily overlooked deduction and reduction benefits" to help employees ensure they do not miss any deduction items during the year-end tax settlement process.

First, young employees (aged 15 to 34) newly employed at SMEs can receive a 90% income tax reduction for five years from their employment date. Employees aged 60 or older, those with disabilities, or those with career interruptions can receive a 70% income tax reduction for three years from their employment date. In particular, for income received from employment starting on or after March 14, 2025, the income tax reduction applies not only to women with career interruptions but also to men with career interruptions. If an employee who has worked continuously for more than one year resigns due to marriage, pregnancy, childbirth, childcare, children's education, or family care, and is re-employed after a period of at least two years but less than 15 years, they are eligible for the income tax reduction.

Spouses who received parental leave benefits and children who received work-study scholarships are eligible for basic deductions and for deductions on credit card spending, medical expenses, educational expenses, insurance premiums, and donations, as long as they have no other income, regardless of the amount received. However, children over the age of 20 are not eligible for the basic deduction or the insurance premium deduction.

Special and general donations made before 2024 that were not previously deducted can be carried forward and deducted for up to 10 years. If donation records are not available through the simplified service, you can receive a donation receipt directly from the donation organization and submit it to your company to claim the deduction.

Employees who pay monthly rent for residential officetels or goshiwons, as well as apartments, are eligible for a monthly rent tax credit. If you have taken out a jeonse (lump-sum lease) loan from a financial institution and are repaying it, you can also claim a deduction for the repayment of principal and interest on the housing lease loan.

If you have questions about deduction requirements or important notes related to year-end tax settlement, you can refer to the comprehensive year-end tax settlement guide on the National Tax Service website or contact the National Tax Counseling Center for assistance.