Frequently Asked Questions

If your annual revenue exceeds KRW 75 million (service industry) or KRW 150 million (wholesale/retail), you're legally required to keep double-entry books as a mandatory bookkeeper. Even below that threshold, bookkeeping lets you reflect your actual expenses to reduce taxes and manage tax risk systematically.
Standards for outsourcing bookkeeping to a tax accountant

It varies by industry and revenue size. Small sole proprietors start from around KRW 100,000 per month. Corporations cost somewhat more since settlement and corporate tax filing are included. For an accurate quote, we'll confirm your industry and revenue size in a consultation.
See our tax service pricing

If you're a mandatory bookkeeper and don't keep books, a 20% no-bookkeeping penalty surcharge applies to your calculated tax. You'll also miss out on reflecting actual expenses, and applying an estimated filing method (simplified or standard expense rate) can result in a higher tax bill.
See our sole proprietor bookkeeping service

It's not mandatory, but strongly recommended. Mixing business and personal spending makes expense processing difficult and can hurt you in a tax audit. It's best to open a separate account and card as soon as you start your business.
Guide to registering your business card/account on Hometax

Notify your current tax accountant that you're terminating the contract, and receive your prior bookkeeping records (ledgers, filed returns) from them. When switching to 103tax, we help with the handover process. Switching at the end of a month is usually the smoothest.
Book a consultation about switching tax accountants

Yes, they're the same office. The correct name is "일공삼택스" (103tax), but because it sounds similar, many people search for it as "일공삼텍스" — so we note both here for clarity.

General taxpayers file twice a year: January 25 (for the prior July–December period) and July 25 (for the current January–June period). Simplified taxpayers file once a year, on January 25. Missing the deadline triggers a late-filing penalty (10–20%) and a late-payment penalty (0.022% per day).
See the complete VAT filing guide

Simplified taxpayers are small businesses with annual revenue under KRW 80 million, and carry a much lighter VAT burden (1.5–4% of revenue). General taxpayers pay 10% VAT on revenue but get a full credit for input tax. If you do a lot of B2B business requiring tax invoices, general taxpayer status is usually more advantageous.
Compare general vs. simplified taxpayer status

Refunds are typically issued within 30 days of filing. Early refunds (for exporters, facility investment, etc.) can arrive within 15 days. Large refund amounts may go through a verification process at the tax office, so it's important to keep your supporting documents in order.
Zero-rate VAT and early refunds for exporters

Purchase and maintenance costs for non-business passenger vehicles (over 1,000cc), entertainment expenses, purchases related to tax-exempt business, and purchases without a proper tax invoice are all non-deductible. Only expenses with a clear business connection qualify, so keeping proper documentation matters.
Complete guide to the 3 types of proper tax receipts

You file the prior year's income every year from May 1 to May 31. Taxpayers subject to the sincere filing confirmation requirement (those exceeding industry-specific revenue thresholds) file by June 30. Failing to file triggers a no-filing penalty of 20% of the tax due.
Sincere filing confirmation criteria and benefits

Yes, that's possible. For 3.3% freelancers, side-income earners, and rental income earners who don't need monthly bookkeeping, we offer a separate service that handles just the annual comprehensive income tax filing.
Learn more about the comprehensive income tax filing agency service

Yes. Once your annual net profit reaches around KRW 100 million, it's worth considering incorporation. Corporate tax rates (9–24%) are lower than individual income tax rates (6–45%), and setting a director's salary can create additional tax savings. The conversion method (in-kind contribution, business transfer) and timing need to be discussed with a tax accountant.
When should you convert to a corporation?

You file within 3 months of your fiscal year-end. Most corporations, which close their books in December, file by March 31. Corporations subject to external audit can extend to April 30. Corporate settlement is complex, so a tax accountant is essential.
Basic tax types and the annual filing calendar

If your income outside of wages exceeds KRW 3 million a year, you must file a comprehensive income tax return in May. Failing to file will result in a retroactive assessment with penalties later on. Filing and claiming your deductible expenses can actually reduce your tax bill.
Deductible vs. non-deductible expense items

You must register within 20 days of starting your business. Registering late makes it harder to claim input tax credits for purchases made in the interim. If you're planning to open a business, it's best to consult first and then register.
How to apply for business registration, and the downsides of delay

Early-stage founders are generally better off as sole proprietors (no setup cost, simpler management). Once your annual net profit reaches around KRW 100 million, consider converting to a corporation. If you're planning to raise investment, starting as a corporation from day one may be better.
Sole proprietor vs. corporation when starting a business

Entrepreneurs aged 15–34 (at the time of founding) who start a business in a qualifying industry can receive the Startup SME Tax Reduction. Up to 50% within the Seoul metro area, and 100% outside it, applied for 5 years. Industry and regional requirements need to be confirmed in advance.
How to get a 100% youth startup tax reduction

Tax saving means legally reducing your tax within what the law allows. Tax evasion is an illegal act — hiding income or booking fake expenses — subject to penalty surcharges and criminal prosecution. 103tax only advises on legal tax-saving strategies.
See legal tax-saving strategies in detail

The Noran Umbrella Fund (Noran Woosan Gongje) is a savings program for small businesses and the self-employed. Contributions can be claimed as an income deduction (up to KRW 6 million a year as of 2026, tiered at KRW 6M/5M/4M/2M depending on your business income bracket). The actual tax savings depend on your income tax rate, and because you can withdraw the funds like a retirement payout when you close your business, it's a very favorable program for business owners.
Why you should join the Noran Umbrella Fund

If a family member is genuinely working in the business, paying them a fair market-rate salary can be treated as a deductible expense. However, payments without actual work performed, or excessively high salaries, may be disallowed. Confirm with a tax accountant in advance before registering a family member as an employee.
Employment contracts and essential paperwork to prepare

The main strategies are the long-term holding special deduction based on your holding period (up to 80%), meeting the one-home-per-household non-taxation requirements, and maximizing recognized necessary expenses (acquisition tax, brokerage fees, remodeling costs, etc.). Always get tax advice before you sell to determine the optimal timing.
Learn about our capital gains, inheritance, and gift tax consulting

Payments received from foreign businesses can qualify for zero-rate VAT (0%) if recognized as foreign-currency-earning goods or services. However, without proper documentation such as a foreign currency remittance certificate, the standard rate may apply — so it's important to review this in advance.
Learn more about zero-rate VAT requirements for exporters

The basics are the Noran Umbrella Fund (up to KRW 6 million income deduction per year as of 2026) and tax credits for personal IRP/pension savings contributions. You can also treat R&D personnel costs as R&D tax credits, or consider converting to a corporation as your revenue grows to lower your tax rate.
3 taxes every solo developer needs to know

Freelancers who report under the personal-service code (940900 series) without formal business registration face a lower mandatory bookkeeping threshold of KRW 75 million, meaning bookkeeping obligations kick in sooner, and they can't claim startup-related reductions such as the Startup SME Tax Reduction under the Restriction of Special Taxation Act. By contrast, registering a business under the software development and supply code (industry code 722000) raises the mandatory bookkeeping threshold to KRW 150 million and also qualifies you for the Startup SME Tax Reduction. Most people doing SI/SM work also use this code.
See the full IT developer business registration guide

A recent tax law change now allows simplified taxpayers (annual revenue under KRW 80 million) to issue tax invoices, but your taxpayer classification can change frequently as your revenue fluctuates, and some clients avoid working with simplified taxpayers because they can't claim input tax credits. If issuing tax invoices is important to you, we recommend registering as a general taxpayer from the start.
See the full IT developer business registration guide