ANNOUNCEMENT 01 Jan 2020

On January 1st, 2020, the Good Landlord Tax Credit came into effect as a result of COVID-19. 

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

Korean National Tax Service. Home. Notices, news. "「착한 임대인 세액공제」 공제기간 연장 및 공제율 상향" of 5 March 2021. Available at:
https://www.nts.go.kr/nts/na/ntt/selectNttInfo.do

The Korean Ministry of SMEs and Startups (중소벤처기업부). Press release. "Prompt payment of KRW 4.1 trillion in support funds for small businesses from January 11th in the new year" ("소상공인 버팀목자금 4조 1천억원 새해 1월 11일부터 신속 지급") of 30 December 2020. Available at:
https://www.mss.go.kr/site/gangwon/ex/bbs/View.do?cbIdx=197&bcIdx=1023604

The Korean Ministry of SMEs and Startups (중소벤처기업부). Press release. "Announcement of implementation of support funds for small business owners" ("소상공인 버팀목자금 시행 공고") of 6 January 2021. Available at:
https://www.mss.go.kr/site/gangwon/ex/bbs/View.do?cbIdx=252&bcIdx=1023759

KPMG. Home. Insights. Korea: Tax relief includes reduced rates. "Korea: Tax relief includes reduced rates, temporary increased deductions (COVID-19)" of 2 April 2020. Available at:
https://home.kpmg/us/en/home/insights/2020/04/tnf-korea-tax-relief-includes-reduced-rates-temporary-increased-deductions.html

Korean National Tax Service (국세청). Home (홈). National Tax Policy/System (국세정책/제도). Good Landlord Tax Credit system (착한임대인 세액공제 제도). "Introduction" ("소개") of 16 March 2021. Available at: https://www.nts.go.kr/nts/cm/cntnts/cntntsView.do?mi=40005&cntntsId=238883

Inception date: 23 Mar 2020 | Removal date: 16 Mar 2021

Tax or social insurance relief

On January 1st, 2020, the Republic of Korea announced a tax concession entitled the Good Landlord Tax Credit ("착한 임대인 세액공제" in Korean) to commercial landlords with tenants running small and medium businesses. The tax law will be implemented on March 23rd, 2020. 

The objective of the tax concession is to provide an incentive for commercial renters to lower their rental prices and help SMEs as a result of COVID-19. In return, they will receive a tax credit of 50% of what they diminish their rent price by. The incentive to reduce the rent is voluntary in nature. 

The tax credit scheme will run through June 30th, 2020. 

The tax credit scheme is one of the many measures the Korean Government has implemented to combat the negative impact of COVID-19 government restrictions on businesses. Please, see related state acts.

Update:

On December 30th, 2020, the Minister for SMEs and Startups confirmed that the tax credit scheme had been extended from June 2020 to June 30th, 2021. 

Update:

On March 16th, 2021, the Korean National Tax Service extended the tax law until December 31st, 2021. They also declared that the tax credit would increase from 50% of rent deducted to 70%. Please, see related state acts.

 

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