A new "marriage tax credit" has been established, allowing couples who register their marriage by 2026 to receive a tax credit of up to 1 million won. It applies only once in the year of the marriage registration, with each spouse eligible for a tax credit of 500,000 won, totaling 1 million won.
The National Tax Service (NTS) released a guide titled "NTS's Tailored Year-End Tax Adjustment Points for Newlyweds" on the 19th. The NTS introduced common questions that newlywed couples have during year-end tax adjustments along with their answers.
According to the National Tax Service, if annual expenditures exceed 25% of the higher-earning spouse's total income, it might be more beneficial to allocate expenditures in the name of the higher-earning spouse to minimize tax burdens. However, if expenditures do not exceed 25% of the total income, it is considered advantageous to allocate expenditures in the name of the lower-earning spouse.
The National Tax Service noted that only employees can apply for income deductions such as credit card expenditures, and stated that the credit cards and debit cards of the spouse with earned income should be used. The NTS explained, "In the case of working couples, using the 'working couple tax-saving guidance' on Home Tax can help identify the optimal combination of deductions."
The National Tax Service also advised regarding loan repayments, stating, "Even if a couple owns a dwelling in joint names, if they are not the loan holder, they cannot receive income deductions even if they repay the mortgage together."
For workers who gave birth last year, tax credits related to children should also be addressed. If the first child was born last year, the childbirth benefits provided by the company are fully tax-exempt up to two times. For children, a basic deduction (1.5 million won) and a childbirth tax credit (300,000 won for the first child) can be applied, and expenditures for coverage insurance and medical expenses, including postpartum care centers, are also eligible for deductions. If the spouse only receives parental leave compensation under the Employment Insurance Act, they do not exceed 1 million won in annual income, so they can be reported as subject to basic deduction.
According to the National Tax Service, to receive deductions for a spouse's medical expenses, the spouse must consent to the provision of simplified data. However, if the spouse's income in the first half of 2024 exceeds 1 million won, the provision of simplified data will be fundamentally blocked and not available for review. Exceptionally, medical expenses that are deductible without income restrictions, as well as educational and insurance fee data that can be deducted until the occurrence of employment-related reasons, can all be provided.
The National Tax Service stated, "For more detailed information, please refer to the year-end tax adjustment comprehensive guide on the NTS website or check the 24-hour AI counseling provided by the Tax Counseling Center."