October VAT Preliminary Return and Notice... Direct Filing Advantageous if Performance Drops Sharply

With the October VAT preliminary return and preliminary notice period approaching, filing methods and precautions according to business types have been released. Since the VAT filing structure differs between corporate businesses and individual businesses, response tailored to one's own type is necessary.

Corporations follow preliminary return, individuals follow preliminary notice principle... Exceptional direct filing possible

According to a National Tax Service video, the VAT filing method varies depending on the business type. Corporate businesses proceed with preliminary returns in April and October, and perform final returns in July and January of the following year. On the other hand, individual businesses generally pay the tax amount notified in April and October, and proceed with final returns in July and January of the following year.

However, even for individual businesses, there are cases where it is advantageous to perform a direct preliminary return instead of paying the notified tax amount. This applies when business performance has decreased significantly due to business suspension or economic recession, or when early refunds are needed due to facility investment or exports. If performance has plummeted, a preliminary return can be made reflecting actual performance, and those eligible for early refunds have the advantage of receiving refunds faster without waiting until the final return.

Payment due by October 26... Caution against missing sales and purchase data

When preparing for the preliminary return, sales and purchase data generated from July to September must be checked thoroughly. The key is to secure relevant materials such as tax invoices, credit card sales/purchase details, and cash receipts in advance, and to check whether there are any missing sales or if deductible purchase details are properly reflected. Caution is required as additional taxes may be imposed if filing is omitted or the deadline is missed.

The deadline for this October VAT preliminary return and payment was originally October 25, but since that date falls on a Sunday, it is extended to Monday, October 26. Eligible businesses must prepare relevant materials and complete filing and payment within the deadline.

Meanwhile, the National Tax Service operates the 'Tax Law Amendment Proposal System' through which taxpayers can convey inconveniences felt during the tax filing process or regulations that do not align with reality. The National Tax Service reviews submitted opinions and, if validity is recognized, proposes tax law amendments to the Ministry of Finance and Economy. In the last five years, approximately 750 amendment opinions have been collected and reflected in tax law amendments, and taxpayers can submit opinions online through the National Tax Service Hometax or mobile app.