Article 143 (Estimation and Correction of Tax Base)

The "reasons prescribed by Presidential Decree" in the proviso to Article 80 (3) of the Act shall refer to cases falling under any of the following subparagraphs. <Amended by 2010.2.18, 2019.2.12> 1. When the books and supporting documents necessary for calculating the tax base are missing, or when important parts such as revenue and major expenses are incomplete or false, in light of the reported contents of businesses in the same industry according to the Korean Standard Industrial Classification. 2. When the contents of the books are clearly false, in light of the scale of facilities, number of employees, market price of raw materials, merchandise or products, various fees, etc. 3. When the contents of the books are clearly false, in light of the amount of raw material consumption, electricity consumption, and other operational conditions.

When the income amount is estimated or corrected according to the proviso to Article 80 (3) of the Act, the following methods shall be used. However, subparagraph 1-2 shall apply only to those eligible for the simple expense ratio. <Amended by 1995.12.30, 2000.12.29, 2002.12.30, 2006.2.9, 2008.2.22, 2010.2.18, 2010.6.8, 2010.12.30, 2013.2.15, 2016.2.17, 2019.2.12, 2020.2.11, 2022.2.15, 2025.2.28, 2025.12.30> 1. A method of determining or correcting the income amount (hereinafter referred to as "base income amount" in this Article) by deducting the sum of the amounts in the following sub-items from the revenue. However, if the base income amount is greater than or equal to the amount calculated by multiplying the income amount according to subparagraph 1-2 by the multiplier prescribed by the Minister of Economy and Finance, the income amount calculated by multiplying by the multiplier may be determined or corrected until the income amount for the taxable period ending December 31, 2027. a. Costs of purchase (excluding the costs of purchasing business-use tangible and intangible assets; hereinafter the same shall apply in this Article) and rent for business-use tangible and intangible assets, for which expenses have been or will be incurred, supported by documentary evidence. b. Wages, salaries, and retirement benefits for employees, for which payments have been or will be made, supported by documentary evidence. c. The amount calculated by multiplying the revenue by the standard expense ratio. However, for those obligated to keep double-entry bookkeeping, the amount calculated by multiplying the revenue by half of the standard expense ratio. 1-2. A method of determining or correcting the income amount by deducting the amount calculated by multiplying the revenue by the simple expense ratio from the revenue (excluding amounts paid by the Minister of Employment and Labor to support part of the costs necessary for maintaining employment of a company according to Article 29 of the 「Framework Act on Employment Policy」, as prescribed by the Minister of Economy and Finance. The same shall apply hereinafter in this subparagraph). 1-3. A method of determining or correcting the income amount by multiplying the revenue of business income prescribed in Article 73 (1) 4 of the Act (hereinafter referred to as "year-end tax adjustment business income") by the income rate of year-end tax adjustment business income prescribed in Article 201-11 (4). 2. When the standard expense ratio or the simple expense ratio has not been determined, or when books and other supporting documents have been lost due to natural disaster, flood, or other force majeure, a method of determining or correcting the income amount by considering the income amount of another business in the same industry that is recognized as having the most accurate bookkeeping. However, if there is no other business in the same industry and the books are lost after filing the final tax return, the income amount shall be determined or corrected based on the return and its attachments under Article 70 of the Act; if the books are lost before filing the final tax return, the income amount shall be determined or corrected based on the income rate of the immediately preceding taxable period. 3. Other methods recognized as reasonable by the Commissioner of the National Tax Service.

The scope of purchase costs and rent for business-use tangible and intangible assets under subparagraph 1 a of paragraph (3), and the types of supporting documents under subparagraphs 1 a and b, shall be determined by the Commissioner of the National Tax Service. <Newly inserted by 2000.12.29, 2020.2.11>

Notwithstanding paragraph (4), business owners falling under any of the following subparagraphs shall not be included in the category of those eligible for the simple expense ratio. <Newly inserted by 2007.2.28, 2009.2.4, 2010.2.18, 2013.6.28, 2020.2.11> 1. Business owners under Article 147-2. 2. Persons engaged in business falling under Article 109 (2) 7 of the Enforcement Decree of the Value-Added Tax Act. 3. Business owners who are required to join a cash receipt merchant system under Article 162-3 (1) of the Act but have not joined (limited to the taxable period in which they have not joined). 4. Business owners who have received notification three or more times from the head of the competent tax office for violating Article 162-2 (2), Article 162-3 (3), or Article 162-3 (4) of the Act during the relevant taxable period, with the total amount of such notifications being one million won or more, or who have received notification five or more times (limited to the taxable period to which the date of occurrence of the notified content belongs).

If supporting documents under subparagraph 1 a of paragraph (3) cannot be submitted, a statement of major expenses paid, as prescribed by the Minister of Economy and Finance, must be submitted. <Newly inserted by 2013.2.15, 2025.12.30>