If you spend 5% more on your credit card next year… Up to KRW 1 million additional income deduction


If you increase your credit card usage by 5% or more next year compared to this year, you will receive an additional income deduction of up to 1 million won.

When consumption increases in traditional markets, the additional deduction rate increased by up to 20 percentage points.

The government announced today (20th) the economic policy direction for 2022 containing these contents.

The government will strengthen tax and fiscal incentives next year to accelerate consumption recovery in industries affected by COVID-19.

The additional consumption special deduction introduced this year will be extended by one year until next year.

The limit is 1 million won, meaning that an additional 10% will be deducted from the amount of credit card used, which has increased by more than 5% compared to this year next year.

To examine the impact of these system changes on individuals, we must first look at the concept of credit card deductions.

The existing credit card income deduction is operated by applying 15, 30, and 40% deduction rates to the amount of credit card use that exceeds 25% of the total salary. , a 40% deduction rate is applied to the portion used in traditional markets and public transportation.

However, there is a limit on the deduction based on the total salary, up to 3 million won for those earning less than 70 million won, up to 2.5 million won for those earning between 70 million won and 120 million won, and 2 million won for those with more than 120 million won up to the circle.

The additional consumption special deduction is a method of adding a deduction rate of 10% to consumption that exceeds 5% in the next year.

Credit card income deduction rate will increase from 15, 30, 40% to 25, 40, 50% It’s possible.

For example, assuming that Mr. A, whose total salary is 70 million won, spent 20 million won this year and 24 million won next year with a credit card, the amount subject to income deduction for Mr. A under the existing system is 375,000 won.

This is the amount (KRW 2.5 million) that exceeds 25% (KRW 17.5 million) of the employee’s total salary of KRW 70 million, out of KRW 20 million, and 15% credit card deduction rate is applied.

When the existing credit card income deduction rules are applied as it is, the amount of credit card deduction for Mr. A next year is 975,000 won.

Again, this is the result of applying the credit card deduction rate of 15% to the amount (6.5 million won) spent in excess of 25% (17.5 million won) of the total salary of 70 million won.

If an additional 10% deduction incentive is given to consumption that has increased by 5% or more (24 million won – 20 million won * 1.05 = 3 million won), the amount subject to deduction is 1275,000 won.

The 10% additional deduction rate means an additional deduction of 300,000 won.

An additional 10% deduction rate is added for traditional market consumption that has increased by more than 5%.

If all of the additional consumption occurred in the traditional market, the deduction rate would be added by 20%.

In other words, the deduction rate from 15, 30, 40% will rise to 35%, 50%, and 60%.

Assuming that Mr. A has consumed 100% of his increased consumption at the traditional market, an additional 20% deduction rate is applied, resulting in a deduction amount of KRW 1,575,000.


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