Temporary exemption from VAT payment for simplified VAT taxpayers
The amount to qualify as a Simplified Taxable Person is increased from KRW 30 million to KRW 48 million annual turnover for 2020
A simplified Taxable Person is exempt from VAT payment obligations until 31 December 2020
Not available for certain business types, e.g. bar business, real estate rental business etc.
VAT reduction for small sole proprietors
For individual entrepreneurs with sales of KRW 40 million or less in each 6 month VAT period (i.e. (i) 1 Jan – 30 June, and (ii) 1 July – 31 Dec), their VAT liabilities are reduced by applying the simplified payment scheme until 31 December 2020
Simplified calculation method: Sales x VAT ratio by industry* x 10%
VAT ratio by industry ranges from 5 to 30%
Not available for certain business types, e.g. bar business, real estate rental business etc.
For more information, please contact Changho Jo, Tax Partner - PwC South Korea.
