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Busan City Announces Guidelines for Filing and Payment of 2025 Local Corporate Income Tax

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The City of Busan (Mayor Park Heong-joon) announced that corporations with a fiscal year ending in December 2024 must file and pay their local corporate income tax between April 1 and April 30, 2025.

The local corporate income tax is calculated separately from the national corporate income tax, applying local tax rates to the same taxable income. Taxpayers must file and pay the tax to each local jurisdiction where business sites are located by April 30. For corporations applying consolidated tax payment, the deadline is May 31.

To support businesses, the city will automatically extend the payment deadline by three months (until July 31) for small and medium-sized exporting companies and businesses affected by disasters.

• ●Companies that have already received an automatic extension for their national corporate tax do not need to apply separately for the local tax extension.

Corporations not eligible for automatic extensions but experiencing significant business losses may apply for an extension at their local district (gu/gun) tax office by April 25. Upon approval, the payment deadline may be extended by up to 6 months, and up to 2 times total, for a maximum of 1 year.

Payment methods include:

• ●Electronic payment via Wetax (www.wetax.go.kr) or Mobile Wetax,

• ●KakaoPay,

• ●ATMs at banks and convenience stores,

• ●Local government unmanned kiosks, and

• ●The automated voice payment system (☎ 142211).

Corporations operating in multiple municipalities must allocate and report tax payments separately to each jurisdiction using the Wetax system.

Kim Kyung-tae, Director of the Planning and Coordination Office of Busan City, stated:

“To support business vitality and reduce burdens on small corporations, installment payments are available for taxes exceeding KRW 1 million. We recommend using the Wetax e-filing system for faster, more convenient processing. Busan will continue working to establish a stable revenue base and ensure a fair and transparent tax environment.”

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Key Information on Final Local Corporate Income Tax Filing

• ●Who must file: Domestic corporations and foreign corporations with a permanent establishment in Korea

• ●Tax base: All income generated in 2024

• ●Tax rate: 0.9% – 2.4% based on taxable income brackets (approx. 10% of national corporate tax)

• ●Filing period: April 1–30, 2025 (consolidated taxpayers may file by May 31)

• ●Filing methods: Paper submission to local tax offices or online via Wetax

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Installment Payment Option (New from 2024)

• ●KRW 1 million – 2 million: Pay excess over KRW 1 million in installments

• ●Over KRW 2 million: Up to 50% of the amount may be paid in installments

• ●Deadlines:

• ○General corporations: Within 1 month after the original payment deadline (by June 2)

• ○SMEs: Within 2 months (by June 30)

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Important Filing Guidelines

• ●If operating in multiple municipalities, taxpayers must allocate and report taxes separately.
  ➝ Failure to do so will result in a 10% penalty for each non-reported site.

• ●All filing documents must be submitted:

• ○The tax return and related documents must be submitted to each jurisdiction.

• ○Supporting documents only need to be submitted to the tax office where the corporate headquarters is located.
  ➝ Failure to submit will incur penalties for non-filing.

• ●No deductions or credits apply to local corporate income tax, even if claimed under national tax.

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Support Measures for SMEs

• 1.Automatic Extension (No Application Required)

• ○Eligible for SMEs that export and disaster-affected businesses

• ○Automatically extended to July 31 if they also received a national corporate tax extension

• 2.Extension by Application (For Business Losses)

• ○Corporations not eligible for automatic extensions may apply by April 25

• ○Extensions of up to 6 months, renewable once (max. 1 year)