Tax refund

Tax refund (조세환급/租稅還給) means the refund of taxes withheld in excess or in error to the taxpayer. It is called tax return or tax rebate.

When it is found that the national tax has been withheld or paid in excess or in error, the head of tax office in the place of tax payment shall determine the tax refund and pay the amount to the taxpayer without delay. National tax refund is realized by transfer of account or payment in cash.

In this case, the taxpayer has obtained the claim for tax refund against the tax collector. The taxpayer may transfer the said claim to a third party.

Key words
tax refund, tax return, taxpayer, head of tax office

Statutory ground
Article 51 (Appropriation and Refund of National Tax Refund) of the Basic Act for National Taxes.
 * (1) If there is any amount paid in error or tax amount to be refunded under the tax-related Acts (when there is any amount of tax to be deducted from the amount to be refunded under the tax-related Acts, referring to the remaining amount after deducting it), which a taxpayer has paid as a national tax, additional dues or disposition fee for arrears, the head of tax office shall immediately determine such excess amount paid in error or tax amount to be refunded as a refund of national tax. In this case, any claim filed for the refund of any tax that has mistakenly or doubly been paid shall be governed by Presidential Decree. 
 * (2) The head of tax office shall appropriate the amount determined as a refund of the national tax for the payment of national taxes, additional dues or disposition fees for arrears that fall under any of the following subparagraphs under the conditions as prescribed by Presidential Decree: Provided, That the appropriation of national tax under subparagraph 1 (excluding the case falling under the cause for collection prior to the payment term under Article 14 of the National Tax Collection Act) and subparagraph 3 shall be made only if the taxpayer agrees to the relevant appropriation: 
 * 1. National tax to be paid by a notification of tax payment;
 * 2. National tax, additional dues and disposition fee for arrears, that are in arrears (where another head of tax office requests such appropriations, national tax, additional dues and disposition fee for arrears, that are in arrears in the relevant tax office, shall be included);
 * 3. National tax to be paid voluntarily under the tax-related Acts; and
 * 4. Deleted. 
 * (3) Where a taxpayer has a tax amount to be refunded under the tax-related Acts, he may request that such tax amount be appropriated for the payment of the national tax as prescribed in paragraph (2) 1 and 3. In these cases, it shall be deemed that such national tax has been paid when the taxpayer has requested such appropriation. 
 * (4) In the event that any person who is liable to withhold taxes at source has any tax amount to be refunded from the tax amount he has paid after having withheld taxes at source, he shall be paid the remainder of the tax amount that he appropriates for the payment of the tax amount he is liable to pay by withholding taxes at source (the appropriation of any refunded tax amount for the payment of a withholding tax on any other taxable item may be allowed only when a report containing details of appropriation and adjustment in the report on the progress in the withholding of taxes at source under the Income Tax Act is filed): Provided, That in the event that the relevant person who is liable to withhold taxes at source asks for the immediate refund of the tax amount or has no tax amount to pay by withholding taxes at source, the tax amount shall be immediately refunded. 
 * (5) The amount of national tax refund left after appropriating under paragraph (2) above, shall be repaid to the taxpayer within 30 days after the refund of the national tax is determined, under the conditions as prescribed by Presidential Decree.
 * (6) Repayment of the national tax refund under paragraph (5) shall be made by the Bank of Korea with the revenues under the jurisdiction of the head of tax office concerned under the conditions as prescribed by Presidential Decree. 
 * (7) When the head of tax office requests the return of the amount which has been already appropriated or paid as the determination on refund of the national tax was canceled, the provisions of the National Tax Collection Act concerning the notification, demand and disposition for arrears shall apply mutatis mutandis. 
 * [This Article Wholly Amended by Act No. 2932, Dec. 22, 1976]

Remittance notice of tax return
The remittance of national tax refund (국세환급금통지서/國稅還給金通知書) shall be made to the Bank of Korea in accordance with Article 51 (5) as stated above.

The taxpayer is also informed of the amount of national tax refund, reason, payment method, payment place, payment request and other necessary matters. In case of payment in cash, the remittance of national tax refund shall be presented to the post office.