Kwanghyun Lim: “For the First Time, NTS to Notify Jointly Owning Married Couples of the Most Favorable Comprehensive Real Estate Tax”

Advantages and Disadvantages of the Joint Ownership Comprehensive Real Estate Tax Regime Differ
…Refunds to Be Issued for Overpaid Taxes

Kwanghyun Lim, Commissioner of the National Tax Service, announced that, for the first time, the agency will launch a customized service to proactively calculate and inform taxpayers about the most favorable tax amount regarding the "Comprehensive Real Estate Tax Special Regime for Married Couples with Joint Ownership of a Single Home," a system where the benefits and disadvantages differ depending on each taxpayer's circumstances.

On September 13, Kwanghyun Lim posted on X (formerly Twitter), "Starting this year, the National Tax Service will, for the first time, calculate and notify married couples who jointly own one home about the most advantageous Comprehensive Real Estate Tax amount." He continued, "We will also identify and refund any Comprehensive Real Estate Tax overpayments made by such taxpayers simply because they were unaware of the system."

Kwanghyun Lim, Commissioner of the National Tax Service.

Commissioner Lim stated, "After analysis, we found about 5,700 married couples with joint ownership would benefit tax-wise from applying for the special regime, while for 2,900 taxpayers who previously applied, canceling the special regime would be more beneficial." He added, "We will proactively identify these taxpayers and send them the most favorable estimated tax amounts individually, either via mobile or mail."

He further explained, "By referring to the projected tax amount you receive, if you apply for or cancel the special regime between the 16th and 30th of this month, during the regular November notice, your tax will be automatically calculated in the most advantageous way. Even if you are unable to decide at this stage, we will assist you so you can file your tax return in the most favorable manner at any time during the December Comprehensive Real Estate Tax filing period."

The National Tax Service plans to soon analyze past special regime applicants and identify taxpayers who paid more in tax, providing individual guidance and proceeding with refund processes. Applying for the special regime allows for a deduction of KRW 1.2 billion from the officially assessed home value, after which tax reductions are applied based on age and ownership period. However, applying for the special regime is not always the most favorable option. Since the introduction of the special regime, the basic deduction has been raised from KRW 600 million to KRW 900 million, which means it could be more beneficial not to apply for the special regime and instead, as a two-home household, each spouse receives a basic deduction of KRW 900 million, totaling up to KRW 1.8 billion combined.

Commissioner Lim pointed out, "Determining which option is more beneficial used to require taxpayers—many unfamiliar with tax law and busy with their day jobs—to access Hometax and perform simulations themselves to decide whether to apply or cancel. Verifying the accuracy of the results was also difficult, and it was especially challenging for elderly taxpayers to even access the Hometax website." He added, "In line with the government's proactive administrative stance, the National Tax Service will expand customized notifications in areas difficult for taxpayers to judge on their own, reducing their inconvenience and ensuring that no taxpayer misses out on their entitlements."

This content was produced with the assistance of AI translation services.