Question 1

When computing inheritance/gift tax, which sale-case value should be used if there are several?

Accepted Answer

Use the value on the date closest to the valuation date.
If there are two or more values from equally close dates, use the average of those values to determine the sale-case price.

Question 2

What should be noted regarding the spouse inheritance deduction?

Accepted Answer

1. It applies only to property actually inherited, i.e., property that is substantively attributed to the spouse
2. Must be filed within the inheritance tax filing deadline (within 6 months after the end of the month in which the inheritance commenced)
3. Applied when inheritance property is divided by the deadline (up to 9 months from the end of the month the inheritance commenced), limited to items registered/titled where registration is required
4. Can be claimed together with the financial-asset inheritance deduction
5. Applies only to a legally recognized spouse

Question 3

If heirs reside abroad, what is the inheritance tax filing and payment deadline?

Accepted Answer

1. If the decedent or all heirs reside abroad, the deadline is 9 months from the end of the month in which the inheritance commenced

Question 4

Is VAT imposed on in-kind inheritance tax payments?

Accepted Answer

1. Even if the asset is VAT-taxable, assets paid in-kind are not regarded as a supply of goods
2. VAT is not imposed on in-kind inheritance tax payments, though capital gains tax may still apply

Question 5

Can the inheritance tax filing deadline be extended if heirs have not yet been determined?

Accepted Answer

1. The deadline is 6 months from the end of the month in which the inheritance commenced
2. The commencement date is the date of the decedent's death, with no exception
3. Even if heirs have not yet been determined, the tax base must be filed by the deadline, and a description of the inheritance relationship must separately be submitted to the competent tax office within 30 days of heirs being determined

Question 6

Is inheritance tax filing mandatory in all cases?

Accepted Answer

Based on net assets, filing is not mandatory if below KRW 500 million.

However, the determination is not made solely by the assets on the commencement date: if there have been recent asset dispositions or many pre-death gifts, filing may be required.

Question 7

What is the 'Worry-Free Inheritance One-Stop Service'?

Accepted Answer

A service that lets heirs look up the decedent's financial accounts, land, vehicles, and taxes all at once.

Available online or at a community center.
1. Eligibility: first-order and second-order heirs
2. Deadline: within 1 year from the end of the month of death

Question 8

When is inheritance vs. gift more advantageous?

Accepted Answer

Gift is advantageous
1. When property value is expected to rise
2. When you can leverage the deduction ceiling
3. When children will need to use loans or income streams in the future

Inheritance is advantageous
1. When property value is falling or stable
2. Inheritance deductions are generally larger
3. When the burden-bearing party is overwhelmed

Frequently Asked Questions (FAQ)

Frequently Asked Questions