1. Personal Income Tax (종합소득세)
- • 8-bracket progressive rates 6%~45% (plus 10% local income tax surcharge → effective up to 49.5%).
- • Filing deadline: May 1~31 of the following year (May 31 for 2025 income).
- • Residency rule: Resident if living in Korea ≥ 183 days/year, taxed on worldwide income. Non-residents taxed on Korea-sourced income only.
- • Year-end settlement (연말정산): Employees only; performed by employer in February.
| Bracket (KRW) | Rate | Deduction |
|---|---|---|
| ≤ 14,000,000 | 6% | 0 |
| ≤ 50,000,000 | 15% | 1,260,000 |
| ≤ 88,000,000 | 24% | 5,760,000 |
| ≤ 150,000,000 | 35% | 15,440,000 |
| ≤ 300,000,000 | 38% | 19,940,000 |
| ≤ 500,000,000 | 40% | 25,940,000 |
| ≤ 1,000,000,000 | 42% | 35,940,000 |
| > 1,000,000,000 | 45% | 65,940,000 |
2. Value-Added Tax (부가가치세, VAT)
- • Standard rate: 10% (single rate since 1977).
- • General taxpayer (annual revenue ≥ KRW 100M, or by election): 10%, full input tax credit.
- • Simplified taxpayer (revenue < KRW 100M, or 80M for food/lodging): 1.5%~4% by industry; tax exemption if revenue < KRW 48M.
- • Filing: General — quarterly preliminary + semi-annual final (Jan 25 / Jul 25). Simplified — annual (Jan 25).
- • Zero-rated: Exports, international transport.
- • Exempt: Medical (most), education, financial services, basic groceries.
3. Capital Gains Tax (양도소득세)
- • Real estate: progressive rates (same as income tax) for held ≥ 2 years; short-term 60~70%.
- • Single home (1세대1주택) exemption: Up to KRW 1.2 billion + 2-year holding (and 2-year residence in regulated zones) → fully tax-free.
- • Long-term holding deduction: Up to 80% (10 years holding + 10 years residence) for single home.
- • Stocks: Major shareholder (≥ 1% or KRW 10B in single stock) — progressive 20~25%. Listed retail — generally exempt.
- • Filing: Preliminary by end of 2nd month after sale; final by May 31 next year.
4. Gift & Inheritance Tax (증여·상속세)
- • 5-bracket progressive: 10%~50% (combined gift+inheritance).
- • Spouse exemption: KRW 600M (10-year aggregation).
- • Lineal descendant (adult): KRW 50M (10-year). Minor: KRW 20M.
- • Marriage / childbirth gift bonus (2024 new): Additional KRW 100M from lineal ancestor — within 2 years of marriage or childbirth.
- • Inheritance unified deduction: KRW 500M.
- • Filing: Gift — within 3 months. Inheritance — within 6 months.
5. Other Major Taxes
- • Corporate income tax: 9% (≤ 200M), 19% (200M~20B), 21~24% above. SME R&D credit 25%.
- • Comprehensive Real Estate Tax (종부세): Owner of homes valued ≥ KRW 900M (single home: 1.2B; couple jointly: 1.8B). Filed Dec 15.
- • Property tax (재산세): Annual, July + September.
- • Acquisition tax (취득세): 1~3% for housing; 50% reduction for first-time buyers (≤ 300M, capped at KRW 2M).
- • Local income tax: 10% surcharge on national income tax.
6. Filing & Payment Channels
- • Hometax: hometax.go.kr — official electronic filing portal (Korean only).
- • NTS English: nts.go.kr/english — National Tax Service English site.
- • WeTax: wetax.go.kr — local taxes (acquisition, property).
- • Bank / convenience store: Most national taxes can be paid via bank transfer or CU/GS25/7-Eleven kiosk with the assigned tax notice.
⚠️ For Foreign Residents
- • Residency test: ≥ 183 days/year OR center of vital interests in Korea.
- • Foreign tax credit: For taxes paid abroad on the same income (within Korean liability).
- • Tax treaties: Korea has DTAs with 90+ countries — may reduce withholding rates or exempt certain income.
- • Severance pay: Special calculation for non-residents leaving Korea.
- • Foreign worker flat 19%: Eligible foreigners can elect a 19% flat rate (instead of progressive) for first 20 years.
- • Korean accountant required: For complex cases (real estate, corporate). Use our advisor directory (Korean).
7. Useful TaxWise Tools
Most tools are in Korean but use universal numbers — input amounts in KRW.