"You Can Make Money from Stocks — or Lose Tens of Millions of Won"...This Tax Must Be Paid

Image generated by AI to aid understanding of the article [Financial News] Large shareholders who sold shares of domestically listed companies in the second half of last year must voluntarily file and complete payment of capital gains tax by March 3. If they fail to recognize that they meet the criteria for a large shareholder and miss the filing deadline, they may be hit with a non-filing penalty of up to 20% of the tax due, so extra caution is advised.
According to an announcement by the National Tax Service (NTS) on the 8th, those required to file capital gains tax returns by March 3 include large shareholders of listed companies who sold shares in the second half of last year, small shareholders who traded shares over the counter, and shareholders who transferred unlisted shares.
A large shareholder of a listed company is defined as someone who, as of the last day of the fiscal year preceding the transfer date, either holds at least 5 billion won in market value per stock or owns at least 1% of shares on the main stock market (KOSPI), 2% on KOSDAQ, or 4% on KONEX. However, among small and mid-sized company shareholders trading through the Korea Over-the-Counter market (K-OTC), those who transfer unlisted shares with a stake of less than 4% and a market capitalization under 5 billion won are excluded from taxation.

The capital gains tax rate is 20% on the portion of the tax base up to 300 million won, and 25% on the amount exceeding that threshold. If a large shareholder of a non–small or medium-sized enterprise transfers shares held for less than one year, a higher rate of 30% applies.
If taxpayers fail to file or file incorrectly, additional penalties are imposed. A simple mistake that results in underreporting the tax due triggers a 10% underreporting penalty, while failing to file by the deadline leads to a 20% non-filing penalty. If tax authorities uncover non-filing or underreporting caused by fraudulent methods such as manipulating books, an additional penalty of 40% is imposed.

To help taxpayers file smoothly, the NTS is providing guidance to those required to make preliminary filings based on data collected from securities firms. Since the 4th, it has been sending notices via mobile messengers such as KakaoTalk, and for those who have opted out of such messages or are aged 60 or older, it is also sending notices by mail.


hsg@fnnews.com Han Seung-gon Reporter