For multi-homeowners, capital gains tax is a critical factor affecting the profitability of real estate investments. As of 2025, understanding the calculation methods and tax-saving strategies for these taxes is essential. Simultaneously, establishing a corporation in a coworking space is emerging as a strategic business approach to mitigate the financial impact of real estate-related taxes. This article explores the intersection of tax strategies for multi-homeowners and the benefits of setting up a corporation in a coworking environment.
Understanding Capital Gains Tax for Multi-Homeowners
Basic Structure of Capital Gains Tax
Capital gains tax is imposed on the profit made from the sale of real estate. The basic calculation structure is as follows:
- Capital Gain = Selling Price – Purchase Price – Allowable Expenses
- Taxable Capital Gain = Capital Gain – Long-Term Holding Deduction
- Tax Base = Taxable Capital Gain – Basic Deduction (2.5 million KRW)
- Calculated Tax = Tax Base × Tax Rate – Progressive Deduction
Allowable expenses include acquisition tax, registration fees, legal fees, and brokerage fees. These costs can be deducted if they are supported by documentation.
Additional Taxation for Multi-Homeowners
Typically, multi-homeowners face additional taxation on their capital gains. In designated regulatory areas, selling a property can result in an additional 20-30 percentage points on top of the basic tax rate. However, this additional tax has been suspended until May 2026, allowing only the basic rates to apply.
Strategic Approaches to Tax Savings
Multi-homeowners can employ various strategies to reduce their tax burden, such as strategically offsetting gains with losses or maximizing long-term holding deductions. Furthermore, transferring ownership to joint names with a spouse or gifting property to children can also lead to significant tax savings.
Linking Coworking Spaces and Corporate Establishment
Another strategy to reduce the financial impact of real estate investments is to establish a corporation within a coworking space. This approach is beneficial for several reasons:
Cost Efficiency and Flexibility
Coworking spaces eliminate the need for large upfront investments in office infrastructure and long-term lease commitments. This can alleviate financial burdens associated with real estate investments. Moreover, flexible contract terms allow businesses to adapt their office space according to their growth needs.
Strategic Location and Networking Opportunities
Typically located in urban centers, coworking spaces offer excellent accessibility and networking opportunities with other businesses. This environment fosters collaboration and the discovery of new business opportunities, adding value to the enterprise.
Tax Savings via Coworking and Corporate Establishment
By establishing a corporation in a coworking space, real estate-related tax burdens can be alleviated. This setup allows for income distribution through the corporation, enabling access to various corporate tax benefits. Additionally, transferring real estate assets to corporate ownership can reduce personal tax liabilities.
Conclusion
For multi-homeowners, tax strategies related to capital gains are crucial for maximizing real estate investment returns. Effectively implementing these strategies requires leveraging synergies between real estate and business operations. Establishing a corporation in a coworking space offers a cost-efficient and flexible approach to managing real estate investments and business operations, reducing overall tax burdens and creating new opportunities.