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Tax Invoice(세금계산서)

According to tax law, you need to receive a proper receipt for your spending if you want to submit it as a tax deductible item when you file a return, this includes credit/check card receipts, cash receipts and finally tax invoices. (Based on VAT law; 10% of the product or service amount)

You need to issue these tax invoices electronically if you're a company registered at the court, with a capital in paid without any exception, otherwise you'll be fined. And also if you're a sole proprietor whose sales are more than 600 mil.won or 1bil.won (Depending on your business scope), you need to issue tax invoices electronically. For electronic tax invoices, you need a Digital certificate which is separate from a banking one.

When you issue these tax invoices electronically, you need the following information along with a copy of your client’s tax registration (사업자등록증):

1. Issue date; when you recognized your sales or income, product delivered, service provided or completed.

2. Amount: product or service provided

3. 10% VAT

4. Name of the product or service provided

5. Email address of your client where to send tax invoices

When you issue it, it'll be uploaded on the NTS (National Tax Service) server and sent to your client’s email to find. Therefore, all of your accountants can download these tax invoices (sales and purchase) for VAT filing quarterly for a company and half yearly for a sole proprietor.

The following picture is the typical tax invoice (세금계산서) issued by a sole proprietor manually, but you will need to check the tax ID no. of your supplier whether it's valid or not at the NTS website. For an electronic tax invoice, you can't issue or upload it on the NTS web server if it's not a valid tax ID.

When you buy raw meat or vegetables, you can also ask for a tax invoice (계산서), pictured below, which is not for 10% VAT, but it's for your tax deductible proper receipts according to the VAT law.

Can you differentiate between these 2 invoices (세금계산서 and 계산서)?

Whatever you called or read, there're similar documents saying 거래명세표, 거래명세서 which is a kind of packing or delivery list, you can't use these documents in place of proper receipts. This 계산서 can't be downloaded from the NTS server if the issuer was a sole proprietor.

These kinds of receipts are your tax deductible ones, so I always recommend that you ask your suppliers to issue them even if they ask you to pay 10% more for your deduction.

To issue these tax invoices electronically, you need to pay 200~1,000 won via the website, but you can issue it through your "HOME TAX" website free.

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