bankruptcy tax deductions
South Korea Introduces Additional Tax Incentives
The South Korean government has announced tax incentives to help those on lower incomes – self-employed owners of small businesses, small to medium-sized enterprises (SMEs) and individual employees – that are likely to be suffering in the current economic recession.
It was stated that owners of small businesses, who have had to close their businesses due to the recession, will be exempted from unpaid taxes up to an amount of KRW5m (USD4,000) until the end of 2010. This exemption will be available for those with no assets, even if they have found new sources of income by starting new businesses or finding other employment. Small businesses, which earned a three-year average of less than KRW200m per annum before having to be closed, will be eligible for the incentive.
The amount of unpaid tax of small businesses which has to be notified on their credit history will be raised temporarily for two years from KRW5m to KRW10m, so as to allow 380,000 current tax defaulters to continue to use bank funding. In certain circumstances, including bankruptcy, the grace period for tax payments will also be extended from nine months to eighteen months for businesses with no previous record of non-payment. As against the previous rules, late payments will now repay the unpaid tax before any penalties, resulting in more effectively reducing the amount of unpaid taxes.
In addition, medical and education fees will be tax-deductible up to the end of 2012; and the lower VAT rates applied to small restaurants, hotels and retailers will be extended for two years until 2011.
With regard to SMEs, amongst other measures, less rigorous regulations will be applied when family businesses are inherited; the upper limit on tax payment by credit card will be increased from up to KRW2m to up to KRW5m for all taxes; significant SME support measures, due to be withdrawn at the end of 2009, will be extended for three more years to the end of 2012; and a delay or suspension of tax payments will be granted to SMEs suffering temporary hardship arising from, for example, natural disasters or the lack of available credit.
Measures introduced for employees include a tax deduction for their monthly rent for those earning less than KRW3m a year, with dependents, and living in houses of less than 85 square metres. Furthermore, interest tax-free deposit products for farmers and fishermen will be available for two further years until 2011. There will also be transfer tax and real estate measures, with tax deductions for donations to fund microcredit loans, education and social welfare.
The above incentives are expected to cost a total of KRW3.6 trillion. However, as most of the measures are extended rather than newly-introduced, it is estimated that the actual decrease in tax revenue will be about KRW200bn.
For more information, please contact http://www.ocra.com
About the Author
Jaiya
|
|
Financial First Aid Kit $1.64 With this all-in-one software package, you can solve your urgent debt and credit problems, create a personalized money plan, and start a business to increase your income. Inside, you’ll find these bestselling Nolo eBooks: * Credit Repair Plus, get these bonus materials to … |
|
|
Debtor’s use of NOLs received from bankruptcy estate.(net operating losses): An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA’s on August 1, 2004. The length of the article is 614 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.Citation DetailsTitle… |
|
|
Bankruptcy professional fees are not SLLs for carryback purposes.(specified liability losses): An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA’s on September 1, 2003. The length of the article is 1023 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.Citation DetailsT… |
|
|
Tax issues for bankruptcy trustees.: An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA’s on September 1, 1995. The length of the article is 981 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.From the supplier:… |
