Gyeonggi Province to Refund Acquisition Tax to First-Time Home Buyers Since June 21 Last Year

[Suwon Ilbo=Reporter Park No-hun] Gyeonggi Province announced on the 9th that it will proceed with refunding acquisition tax to first-time home buyers who purchased homes after June 21 last year.

This follows the enforcement of the 'Special Local Tax Exception Act' on the 14th of last month, whereby acquisition tax will be retroactively applied from June 21 last year for those acquiring a home for the first time, with refunds of up to 2 million won.

Previously, when acquiring a first-time home, a reduction rate of 100% was applied to homes priced at 150 million won or less and 50% for homes exceeding 150 million won up to 400 million won (300 million won for non-capital regions), provided that the combined household income did not exceed 70 million won and the purchased home price did not exceed 400 million won (300 million won for non-capital regions), with acquisition tax exemptions capped at 2 million won.

However, with this amendment, the income requirement has been removed and the exemption has been expanded to a maximum of 2 million won deduction without reference to reduction rate standards for the acquisition of homes valued at 1.2 billion won or less, regardless of region.

Therefore, those who acquired a first-time home after June 21 last year and had previously received exemptions will now be eligible for additional refund tax if they purchased a home exceeding 150 million won, and those who purchased a home exceeding 400 million won up to 1.2 billion won can also receive refunds.

However, in line with the purpose of supporting ordinary citizens and actual users, if the purchaser did not maintain primary residence within three months of the home acquisition date, acquired additional homes, or sold, gifted, or used the home for other purposes such as rental while the period of primary residence was less than three years, the exempted acquisition tax will be recovered.

For those initially determined as refund recipients but who subsequently fall under or have fallen under such conditions, they must file corrected returns in advance or immediately and pay the exempted tax amount to reduce the burden of additional taxes from subsequent recovery.

Refund recipients should prepare necessary documents and submit a refund application to the tax department of the city or county where the acquired home is located.

Meanwhile, from the enactment and enforcement of the law (March 14) through the end of March, the 26 cities and counties in Gyeonggi Province approved acquisition tax refunds of approximately 10,000 first-time home purchases totaling 10.1 billion won.