Living in Korea · Money
Income Tax for Foreigners in Korea
Foreign employees in Korea are taxed much like locals — a progressive scale from 6% to 45%, plus a 10% local surtax — but with two things newcomers often miss: an optional flat rate for foreign workers, and the annual year-end settlement (연말정산) that decides your refund or extra bill. Here is how it fits together.
Two ways foreign employees can be taxed
| Progressive scale (default) | 6% – 45% by bracket |
| Local income tax | +10% of the income tax |
| Flat-rate option (foreign employees) | 19% of gross (+ local surtax) |
The flat rate is elective and replaces most deductions/credits; it is available for a limited period from your first work day. Confirm current rates and eligibility with 국세청 (National Tax Service).
On the progressive scale, tax rises through brackets and you can claim deductions and credits (dependents, insurance, housing, etc.). The flat rate applies one percentage to gross salary but gives up most of those deductions — so it tends to favour higher earners and simpler situations. You can compare both and choose.
How it is collected: monthly + year-end
Your employer withholds estimated tax from each paycheck using a simplified tax table — the same mechanism our salary calculator models. Then, once a year:
- 연말정산 (year-end settlement), around February: your actual deductions and credits for the previous year are totalled and compared with what was withheld.
- If too much was withheld, you get a refund; if too little, you pay the difference.
Foreign employees go through 연말정산 too. Keep records of insurance, rent, medical and other deductible spending during the year.
Resident vs non-resident
Having a home in Korea or staying 183+ days in a tax year generally makes you a resident for tax, which affects what income is taxable and which deductions apply. Short-term stays may be taxed as a non-resident. Tax treaties between Korea and your home country can also change the outcome.
This is general orientation, not tax advice. Rates, the flat-rate percentage and its eligibility window change — verify with the National Tax Service (국세청 · Hometax) or a licensed tax accountant (세무사) for your situation.
Frequently asked questions
How much income tax do foreigners pay in Korea?▾
Foreign employees are taxed like residents by default — on a progressive scale from 6% up to 45%, plus a local income tax equal to 10% of the income tax. Alternatively, many foreign workers may elect a single flat rate on gross employment income instead of the progressive scale.
What is the flat tax rate for foreigners?▾
Foreign employees can choose a flat rate (19%, plus the 10% local surtax on that) applied to gross salary, instead of the progressive brackets — but choosing the flat rate means giving up most deductions and credits. It suits higher earners; lower earners are usually better off on the progressive scale. It is available for a limited period from your first day of work in Korea.
What is 연말정산 (year-end settlement)?▾
Each year your employer withholds an estimate of your tax monthly. In February, the year-end settlement (연말정산) reconciles what was withheld against what you actually owe after deductions and credits — producing a refund or an extra bill. Foreigners go through it too.
Am I a resident or non-resident for tax?▾
If you have an address in Korea or stay 183 days or more in a tax year, you are generally treated as a resident and taxed on income accordingly. Residency affects which income is taxable and which deductions apply — check your situation with the National Tax Service (국세청).