Jeonju
Taxation
Guidance on local taxes, including property tax, income tax, and understanding tax laws for residents and newcomers.
Sections
1. Overview of the Tax System in South Korea
South Korea has a centralized tax system, meaning taxes are administered and collected by the National Tax Service (NTS). However, local governments, including Jeonju, also levy certain taxes such as property tax and local income tax. Taxes in South Korea are categorized into national taxes (e.g., income tax, corporate tax, VAT) and local taxes (e.g., property tax, acquisition tax, and local income tax).
If you are living or working in Jeonju, you will be subject to the same tax laws as the rest of South Korea, but there are local offices and considerations specific to the city.
2. Categories of Taxes in Jeonju
A. Income Tax
Income tax in South Korea is progressive, meaning the rate increases as your income rises. It applies to both residents and non-residents, but the scope of taxable income differs:
- Residents: Taxed on worldwide income.
- Non-residents: Taxed only on income earned in South Korea.
Tax Rates (2023):
- Up to KRW 12 million: 6%
- KRW 12 million โ 46 million: 15%
- KRW 46 million โ 88 million: 24%
- KRW 88 million โ 150 million: 35%
- KRW 150 million โ 300 million: 38%
- KRW 300 million โ 500 million: 40%
- Over KRW 500 million: 45%
Local Income Tax: In addition to national income tax, a local income tax of 10% of your national income tax liability is levied. For example, if your national income tax is KRW 1 million, you will pay an additional KRW 100,000 as local income tax.
Filing and Payment:
- Tax Year: January 1 to December 31.
- Filing Deadline: May 31 of the following year.
- Where to File: Taxes can be filed online via the NTS website (Hometax, https://www.hometax.go.kr) or at the local tax office in Jeonju.
Deductions and Credits:
- South Korea offers various deductions for residents, such as for medical expenses, education, and charitable donations.
- Foreigners may qualify for a flat tax rate of 19% on gross income (optional) instead of the progressive tax rates.
B. Value-Added Tax (VAT)
VAT is a consumption tax applied to goods and services in South Korea, including Jeonju. The standard VAT rate is 10%.
Key Points:
- VAT is included in the price of most goods and services.
- Tourists can claim VAT refunds on eligible purchases made at tax-free shops (look for the "Tax-Free" sign). Refunds can be processed at airports or designated refund counters.
C. Property Tax
If you own property in Jeonju, you will be subject to property tax, which is levied annually by the local government.
Tax Rates:
- Residential property: 0.1% to 0.4% of the propertyโs assessed value.
- Commercial property: 0.5% to 0.7%.
Payment:
- Property tax is typically paid in July each year.
- Bills are sent to property owners, and payments can be made online, at banks, or at the local tax office.
D. Acquisition Tax
If you purchase property in Jeonju, you will need to pay an acquisition tax. The rate depends on the type and value of the property:
- Residential property: 1% to 3%.
- High-value or luxury properties: Up to 12%.
This tax is paid at the time of property registration.
E. Other Local Taxes
- Automobile Tax: If you own a car in Jeonju, you will pay an annual automobile tax based on the engine size and type of vehicle.
- Resident Tax: A small annual tax (around KRW 10,000โ20,000) is levied on all residents.
3. Procedures for Filing Taxes
A. For Employees
- If you are employed, your employer will typically withhold income tax from your salary and file it on your behalf. This is called year-end tax settlement (์ฐ๋ง์ ์ฐ, Yeonmal Jeongsan).
- You will need to provide documents for deductions (e.g., receipts for medical expenses, education costs) to your employer by January of the following year.
B. For Self-Employed Individuals
- Self-employed individuals must file their taxes directly with the NTS.
- You can file online via the Hometax system or visit the Jeonju Tax Office for assistance.
C. For Foreigners
- Foreigners can use the same filing methods as residents. The Hometax website has an English-language option to assist expatriates.
- If you are unsure about the process, you can hire a tax accountant (์ธ๋ฌด์ฌ, Saemusa) in Jeonju to help with filing.
4. Important Timelines
- January: Employers begin year-end tax settlement for employees.
- May 1โ31: Deadline for filing and paying individual income tax.
- July: Property tax bills are issued and due.
- October: Second installment of property tax (if applicable).
5. Local Considerations in Jeonju
A. Jeonju Tax Office
The Jeonju Tax Office (์ ์ฃผ์ธ๋ฌด์) is the primary location for handling tax-related matters in the city. Here, you can file taxes, ask questions, and resolve issues.
Address:
Jeonju Tax Office
Jeonju-si, Wansan-gu, Jeonbuk Province, South Korea.
(Exact address can be found on the NTS website or by searching "์ ์ฃผ์ธ๋ฌด์" in Korean.)
Hours:
Monday to Friday, 9:00 AM โ 6:00 PM (closed on weekends and public holidays).
B. Language Assistance
While the Hometax website offers English support, in-person services at the Jeonju Tax Office may primarily be in Korean. Consider bringing a Korean-speaking friend or hiring a translator if needed.
C. Cultural Tips
- South Koreans take tax compliance seriously, and the government has strict penalties for late or inaccurate filings.
- Keep all receipts and documentation for deductions, as audits are not uncommon.
- Many Koreans use mobile apps or online platforms to track expenses and prepare for tax season.
6. Resources for Assistance
- National Tax Service (NTS): https://www.nts.go.kr (English option available).
- Hometax: https://www.hometax.go.kr (for online filing and payments).
- Jeonju City Hall: For local tax inquiries and assistance.
- Tax Accountants (์ธ๋ฌด์ฌ): Many tax professionals in Jeonju specialize in helping expatriates and foreigners.
By understanding these details, you can navigate the taxation system in Jeonju with confidence. If you need further assistance, feel free to ask!