The 2008 Korea Credit Card Tax DeductionA lot of misunderstandings and mysteries surround this deduction. I'm going to attempt to explain it. =) For 2008, the kind people at the National Tax Service are being more generous than in 2007.
First of all, go to the bank or contact your credit card company (via telephone or web) and get a 2008 total spending statement. Now let's get it started....
1. Let's say I spent 3,500,000 won in total on my Samsung card in 2008. (I spent 3,490,000 won on beer and 10,000 won for the subway.)
2. Multiply your total (gross) 2008 salary by 10% For example, if my total gross income was 10,000,000 won. 10,000,000 x .10 = 1,000,000
3. 3,500,000 (total credit card) - 1,000,000 (Salary x .10) = 2,500,000 won.
4. 2,500,000 won x .20 = 500,000 won (Tada!)
5. 10,000,000 - 500,000 = 9,500,000 won (This is your new taxable income.) So, instead of paying taxes on 10,000,000 won you would pay taxes on 9,500,000 won. Easy. Right? =) (I love tax deductions. Don't you have a warm feeling inside now?)
This is the 2008 NTS formula: [(Credit Card Transaction - Total wage and salary x .10) x .20] http://www.nts.go.kr/
*In 2007, the NTS used this formula: [(Credit Card Transaction - Total wage and salary x .15) x .15]
4 comments:
you forgot to factor in buying cigarettes and playing pool.
But we usually pay in cash for those. =)
andy,but it's only for employees, right?
Yes. You must have a job.
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