ASSESSMENT AND COLLECTION

The income tax is to be self-assessed and filed by the taxpayer. However, the government

will correct the tax base and the tax amount if there are any omissions or errors in the

return filed, or if the taxpayer has not submitted the payment statements or the aggregate

summary of accounting statements in whole or in part.

A. Determination of Tax Base and Tax Amount

In cases where the government determines or corrects the tax base and the tax amount

payable by a taxpayer, the tax base and the tax amount must be determined or corrected

according to the law based on the final return and the attachments thereto, or by a field

audit.

Determination must be completed within a year from the filing due date except in cases

such that the Commissioner allows an extension of time for special investigation, or

approves a late determination based on extenuating circumstances.

To prevent income tax evasion, the government may, monthly or occasionally, determine a

tax base prior to the filing or determination period in the following

circumstances(Occasional assessment) :

when a taxpayer frequently moves his business place, domicile, or residence without

reporting such movements to the government;

when a taxpayer has closed down or has suspended his business operation due to poor

business conditions or other reasons; and

when a taxpayer is located in an area deemed to be a place of frequent moves for

place of business, residence, or domicile.

B. Minimum Taxable Floor

If the amount of other income is not more than 1,000 Won per case, income tax is

waived.

C. Notice on Tax Base and Tax Payable

If the government determines or adjusts a tax base or a tax amount, the government shall

notify the concerned resident the tax rates and/or any other necessary matter in writing.

D. Collection of Tax

If a taxpayer does not pay the full tax amount for the year in question, the government

will endeavor to collect the unpaid tax amount within three months after the due date of

payment.

When the income tax amount paid by the taxpayer is less than that determined by the

government, the unpaid amount of tax will be collected.