There is no predetermined target amount for reassessments in tax audits
12 June 2026
Tags
Tax
One of the common misconceptions surrounding tax audits is the belief that tax authorities operate with a predetermined “target reassessment amount.” However, this is not accurate. While the National Tax Service (NTS) conducts thematic audits focusing on specific industries or tax issues based on data-driven analyses, it does not set target reassessment amounts for taxpayers in advance.
The outcome of a tax audit is inherently dependent on the verification of factual circumstances and the interpretation of tax laws and may vary based on the taxpayer’s explanations and supporting evidence. In practice, it is not uncommon for the initial reassessment direction to change during the course of an audit when additional documentation is submitted or when a reasonable legal interpretation is presented. Furthermore, tax audit results are subject to post-review processes, including internal audits within the NTS and inspections by the Board of Audit and Inspection. As such, it is institutionally impermissible for tax audit officials to arbitrarily establish target reassessment amounts.
Recent developments in tax administration reflect a shift away from simply increasing the number of field audits. Instead, there is a greater emphasis on enhancing taxpayers’ ability to prepare in advance. Measures such as extending the prior notice period for tax audits to 20 days under the Framework Act on National Taxes, introducing a system allowing taxpayers to select the timing of audits, permitting foreign-invested companies to apply for a two-year deferral of audits, and disclosing key audit focus areas in advance all aim to strengthen taxpayer preparedness. These changes indicate a policy direction toward advancing the NTS’s data analytics capabilities to identify high-risk areas while reducing the compliance burden on compliant taxpayers.
Accordingly, the key to effectively managing a tax audit lies in proactively identifying potential issues and systematically organizing the relevant facts and legal grounds for each issue. Rather than merely responding to document requests, taxpayers should work closely with tax professionals to conduct a preemptive review of the appropriateness of their tax positions and associated risks. In cases where disagreements arise with the audit findings, taxpayers should also be aware of and make full use of the remedies available under tax law, such as pre-assessment review procedures, tax appeals, and administrative litigation.
In conclusion, as recent institutional changes provide taxpayers with more time to prepare, tax audits should be approached not as a matter of reactive compliance, but as part of a proactive risk management strategy.
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