If you are thinking of investing for your children, you may be wondering how to file a gift tax return on a gift.
For children under the age of 20, up to 20 million won for 10 years, and up to 50 million won for adult children are exempt from gift tax.
It is not common to donate large sums of money, but it is essential to become a conscientious taxpayer.
And, if the donated money makes a profit, the profit is not taxable (refer to the link below),
If you do not report it, you will be subject to tax, so you need to think carefully about the gift declaration.
Do I have to pay gift tax if I buy and sell stock using my child’s child allowance?
In this article, we will discuss how to report cash gifted to a minor child at Hometax. 현금 증여 신고
1. Required documents for hometax gift tax return 좋은뉴스
In order to file a gift tax return to a minor child, the following three documents are required.
– Family relationship certificate (based on children)
– Basic certificate (based on children)
– Proof of deposit (copy of child’s bankbook, deposit statement, etc.)
– Your child’s official certificate
2. File gift tax at Hometax
Now, let’s see how to access Hometax and file a gift tax return one by one.
It would be nice if your child signed up for Hometax, but it is cumbersome because it requires a visit to the tax office.
You can report through ‘Non-member login’ with ‘Children’s Certificate’, so we will proceed in this way.
1) Hometax access and non-member login: http://www.hometax.go.kr/
Click ‘Login’ at the top of the Hometax screen >> Enter non-member login information >> Log in by checking the official certificate.
2) Select ‘Gift tax’ in the service for non-members only
3) Select ‘Create final report’ on the next screen
4) Enter gift tax return information
In the figure below, the donor is the parent’s information, and the donor is the child’s information. You can proceed to the next step by clicking the red boxed ‘Search’ button.
5) Enter gifted property information
You are required to enter information about the gifted property. In the case of a simple cash gift, select as shown in the figure below and enter the amount of the gift.
After that, click the ‘Register’ button and then ‘Save and move to the next’ to enter the tax amount calculation.
6) Enter tax calculation
The calculated tax amount will be ‘0 won’ only when the ‘donated property deduction’ field is entered.
7) Submit after confirming the calculated tax amount
Check your input and if there are no errors, click the ‘Submit’ button.
8) Submission of supporting documents
Once the input is complete, you need to ‘submit the documentary evidence’. Return to the initial gift tax return screen and select ‘Submit supporting documents’.
If the report has been successfully reported in the previous step, it will be viewed in the report history as shown below.
You can submit the required documents by selecting ‘Submit attached documents or not’.
Documents to be submitted are the ‘Certificate of Family Relations’, ‘Resident Registration Certificate’, and ‘Proof of Deposit’ mentioned at the beginning of the article.
When I reported myself voluntarily, I remember that it was more cumbersome to obtain evidence than to report it.
If you are making regular donations like pocket money rather than one-time donations, we recommend that you file a donation report at least once every three months.
The reason is ‘If a report is not made within 3 months from the last day of the month to which the date of deposit belongs, the date of deposit is not recognized as the time of donation’.
I hope this has been of some help to you in filing your gift tax return.