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Local (Provincial) Income Tax Law Amendments enforced from 2015

1/29/2015
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Local Income Tax Law(LITL)

 

Under the revised LITL, taxation scheme of the local income tax was changed and newly adopted as follows: 

 

■ Change in taxation scheme of local income tax assessed on corporate income tax

 

(1) Tax base and Tax rate

 ■ Collection of local income taxes on interest income paid to domestic companies is now mandated
 
Before amendment, when interest and dividend income are paid to domestic companies, the corporate income tax was withheld, but the local income tax was not. Under the amended local income law provisions, the local income tax shall be withheld on interest and dividend income paid todomestic companies, which is applicable to any interest or dividend income paid on or after January 1, 2015.

 

The payer who bears tax withholding obligations is required to collect 1/10 of the corporate income tax withheld from the payment and file the local income tax returns to the local tax office by the 10th day of the following month.