[National Tax Service]
[National Tax Service]

The start of the mid-year corporate tax prepayment season for December fiscal-year companies means the scale of South Korea's tax windfall — driven by an unprecedented boom in the semiconductor industry — is expected to come into focus soon.

The National Tax Service said Tuesday that December fiscal-year corporations must file and pay their corporate tax prepayments by the end of this month. The number of eligible corporations stands at 545,000, up 17,000 from a year earlier.

Companies may calculate their prepayment using one of two methods: paying 50 percent of the tax assessed for the previous fiscal year, or filing based on a provisional settlement of their first-half earnings for this year.

However, roughly 2,600 corporations — excluding small and medium-sized enterprises — belonging to business groups designated for public disclosure by the Korea Fair Trade Commission must use the provisional settlement method.

Once Samsung Electronics and SK hynix file their corporate taxes under that method, analysts expect to gain a clearer picture of the overall size of this year's tax surplus.

The two companies' combined cumulative operating profit through the first half of this year reached nearly 245 trillion won ($172 billion) — Samsung Electronics posting 146.7 trillion won and SK hynix 98.15 trillion won — roughly one-third of the government's total budget for this year based on the original appropriation.

Deputy Prime Minister Koo Yun-cheol, who also serves as minister of Economy and Finance, has said the government needs to see first-half operating results and the August corporate tax prepayments before it can forecast this year's total tax revenue.

Small and medium-sized enterprises with a tax liability of 20 million won or less may pay 10 million won by the end of August and settle the remainder within two months. Other companies may pay at least 50 percent by the end of August and remit the balance within one month. Samsung Electronics and SK hynix are also expected to spread their prepayments across two months, completing payment by the end of September.

As a support measure, the National Tax Service will automatically extend the corporate tax prepayment deadline by two months — to Nov. 2 — for small and medium-sized enterprises affected by the Homeplus crisis, high exchange rates or high oil prices, without requiring taxpayers to apply.

The measure is expected to provide liquidity support worth 909.2 billion won to a total of 40,474 corporations.

Small and medium-sized enterprises facing financial difficulties that do not qualify for the automatic extension may still apply for a deadline extension through Hometax or other channels, and the NTS said it will actively review such requests.

Corporations subject to the corporate tax prepayment filing requirement may file and pay through Hometax or Sontax.


oskymoon@heraldcorp.com