Hello ~ Today, I am going to share how to file a capital gains tax return for overseas stocks.
I tend to buy a lot of stocks as a way of investing… In particular, I tend to buy a lot of foreign stocks… (ex Apple, Microsoft, Amazon, Nvidia, Tesla, etc…). Of course, if you need money, you sell stocks to make a profit. When you see a profit, of course… As a Korean citizen, you will have to pay capital gains tax…
Ⅰ Calculation method for capital gains tax on foreign stocks
Ⅱ Kiwoom Securities Foreign Stock Capital Gains Tax Reporting Service
1. Calculation of foreign stock capital gains tax
If you made a profit by buying and selling foreign stocks, the tax calculation method is simple.
① Calculate the remaining amount after deducting overseas stock fees from the money earned during the year, which is the 1 year’s trading profit (January 1 to December 31)!
② 2.5 million won is subtracted from the total profit (2.5 million won deducted)!
③ From there, the amount obtained by multiplying 22% [transfer tax rate (including local income tax)] is the amount to be paid for capital gains tax!!
As a simple example, if you bought 10 million won worth of Tesla stock on January 1 and sold all Tesla stock for 20 million won before December 31, you would have earned 10 million won! 해외주식 양도소득세 신고 방법
Then, out of 10 million won, 2.5 million won is deducted (10 million won – 2.5 million won = 7.5 million won), and 22% of capital gains tax is applied only on the remaining 7.5 million won.
Investors who earned 10 million won must pay capital gains tax of 7.5 million won x 22% = 1.65 million won!
※ Reference
Realized profits from domestic stocks are exempt from taxation.
Of course, this is the current standard… Every time… It changes here and there in relation to taxes… Because domestic stocks can also be taxed. Write it down.
Ah… There are cases where domestic stocks also pay capital gains tax.
I think the major shareholders are already aware of this… so let’s move on.
Stock dividend income tax is a tax applied to dividends earned by owning stocks. It is not a method that investors report directly like capital gains tax, but a securities company pays dividend income tax. It’s part! 부자되는 습관
Overview of foreign stock capital gains tax
Capital gains tax overview
2. Kiwoom Securities Foreign Stock Capital Gains Tax Reporting Service
In order to pay capital gains tax, you can report it to the tax office having jurisdiction over your address in May and pay it, or you can voluntarily report it through Hometex. It will be very convenient to try this method ~
Kiwoom Securities service overview and procedures are as follows.
① Eligibility: Korean customers residing in Korea who generated capital gains of 2.5 million won or more, which is the sum of accounts that sold overseas stocks during the period from January 1 to December 31, 2021
② Description: Kiwoom Securities cooperated with the tax office to file capital gains tax returns for customers who trade overseas stocks of Kiwoom Securities for free, and investors can pay taxes directly after receiving the Giro paper by email.
③ Service application period: March 14 (Mon), 2022 to April 13, 23:59
* Since it is not possible to apply after the deadline, I think it would be better to apply early.
④ Deadline for payment of capital gains tax: May 31, 2022 (If the deadline is exceeded, a penalty of 0.025% for delayed payment will be imposed per day)
⑤ Kiwoom Securities website/Youngwoon Moon G/Youngwoon Moon SG
So, let’s see how to apply through mobile phone easily.
How to check transfer tax (Kiwoom)
When I checked the transfer tax in the photo above, the total amount of capital gains came out to be 72,953 won.
Then, if you remember the calculation of the foreign stock transfer tax, you deduct 2.5 million won from the one-year trading profit (January 1 – December 31) and multiply it by the 22% transfer tax to get the amount of tax to be paid to the government. That’s it!!
But, as shown in the photo above, if you deduct 2.5 million won from one year’s profit from sales of 72,953 won, you can get -2,427,047 won… It sounds like there isn’t.
Kiwoom Securities is… different from other securities companies.. There are things to note.. Kiwoom Securities does not deduct 2.5 million won… It shows the calculated tax on capital gains. What are you talking about?
72,953 won -2,500,000 = -2,427,047 → -2,427,047 * 22% (transfer tax) = 553,950 won It’s not like this…
72,953 won * 22% (transfer tax) = 16,049 won
If you have 2.5 million won deducted like this.. If you have more money to receive, there is no need to file a transfer tax return.
If you have to pay capital gains tax,
If… For example, if the total amount of capital gains is KRW 5,000,000, if you calculate the capital gains tax,
5,000,000 won – 2,500,000 won = 2,500,000 won → 2,500,000 * 22% (transfer tax) = 550,000 won You have to pay taxes!
As mentioned above, it can be seen that approximately how much capital income is calculated.
Then, if you want to continue and complete the transfer tax agency service, you need to apply for transfer tax company registration as shown in the figure below.
Registration of transfer tax agency service
Registration of transfer tax agency service
If your application for transfer tax registration is not registered, you must check the agreement to the agreement to collect/use/provide personal information in order to register for the transfer tax agency service.
Registration of transfer tax agency service 2
Transfer tax agency service 2
If all registrations are completed as shown in the picture above, the transfer tax service application is completed.
Then, Kiwoom Securities will cooperate with the tax office to file capital gains tax returns for customers who trade overseas stocks of Kiwoom Securities for free, and investors can pay the tax directly after receiving the Giro paper by email.
So far, we have learned how to report and calculate overseas stock transfer tax.
How to file a transfer tax return is not that difficult, right? It is very convenient for a securities company to provide a transfer tax agency service.
If everyone does not file a transfer tax return, penalty tax will be applied for not paying the transfer tax, so it is better to prepare in advance.
I will come back with good information in the next post.
Thanks for reading this long post.