This page offers an overview of tax developments being reported globally by KPMG member firms in response to the Novel Coronavirus (COVID-19).
The content will be updated regularly. However, due to the fast-moving pace of change, it may not always reflect the most current developments in a given jurisdiction. Please refer to the date of accuracy and refer to the relevant links, under additional information, for original source information.
Tax Credits for rental business owners who have lowered the rental fee of a commercial building (RSTA §96-3):
If a landlord renting a commercial building cuts the rental fee of a small business tenant from January to June 2020, 50% of the rental-fee reduction will be tax deducted from the landlord's income and corporate taxes, and this tax credit is expected to be applicable for another 6 months until December 2020.
Income and Corporate Tax reductions for small and medium-sized enterprises in special disaster areas (Daegu, Gyeongsan, Bonghwa and Cheongdo) for the taxable period including June 30, 2020 (RSTA §99-11):
Extending the scope of tax support for overseas companies' return to Korea (RSTA §104-24):
Temporary relief for VAT (RSTA §108-4 & §108-5):
Temporary reduction of Individual Consumption tax on car purchases (RSTA §109-4):
70% of the individual consumption tax will be reduced for cars taken out of manufacturing sites or declared as imports from March to June 2020, and 30% of individual consumption tax will be reduced for another 6 months until December 2020.
Temporary Increase in the income tax deduction rate for credit card or other expenses (RSTA §126-2 ):
The income tax deduction rate for the amount paid by credit card or other from March to June 2020 will be doubled(from 15~40% to 30~80%).
Temporary increase to the amount of limitation relating to entertainment expenses - the limitation amount of entertainment expenses will be increased to:
Amended tax bill (including strategies for overcoming COVID 19 and enhancing economic vitality) has been proposed on July 2020 and will be finalized through approval in the National Assembly. Proposed amendments are as follows:
Expansion of investment tax credits
Announcement of new investment tax credit scheme integrating most of current investment tax credit provisions
Support for investments in new industries (e.g., businesses supported by the Korean New Deal policy)
Expansion of scope of new growth-engine technology commercialization facilities qualified for additional investment tax credits to include new businesses supported by the Digital/Green New Deal policies (Precise scope has not been decided yet).
Extension of carryforward period for tax credits and net operating losses