What are the requirements for applying for gift tax payment in annual installments?

Gift tax payment in annual installments can be applied for only when certain requirements are met, and it is approved only when both the requirements and the procedures are satisfied.

First, the requirements for applying for gift tax payment in annual installments are as follows.

① Meeting the tax amount payable criterion

Gift tax payment in annual installments can be applied for only when the gift tax payable exceeds 20 million won.

If the amount is at or below the threshold, payment in annual installments is not permitted.

② Provision of security

To apply for gift tax payment in annual installments, you must provide tax payment security equivalent to the amount of tax to be paid in installments.

Generally, real estate, guarantee insurance, and financial assets are used as security.

③ Compliance with the application deadline

Gift tax payment in annual installments is recognized only when the application is made within the statutory application deadline.

An application for gift tax payment in annual installments must be made within the gift tax return deadline (3 months from the last day of the month to which the date of gift belongs), and where a determination notice has been received, the application can be made within 14 days from the date of notice.

Next, the procedure for gift tax payment in annual installments is divided according to the timing of the application.

Where the application is made simultaneously with the gift tax return, the annual installment payment is received together at the time of the return, and the processing period varies depending on whether the return is filed within the deadline.

Generally, it is processed within about 6 months for a return filed within the deadline and within about 3 months for a return filed after the deadline.

On the other hand, where the application is made after receiving a determination notice on the tax base and tax amount from the tax office, it is processed within about 14 days from the date of application.

All procedures proceed in such a way that they are received at the competent tax office, undergo review, and then a decision on approval is made.

Ultimately, gift tax payment in annual installments is possible only when meeting the requirements + applying within the deadline + providing security are all satisfied.

If necessary, you may wish to review in advance whether the requirements are met and the procedures through a consultation with an attorney specializing in inheritance.