INDIVIDUAL TAXATION

Residents are liable to pay tax on their worldwide income. Married couples are taxed separately.

INCOME TAX

Income is classified according to the following: global income, retirement income, capital gains, and income taxed separately by withholding. Global income is taxed at progressive rates while retirement income and capital gains are taxed separately at different rates.

The following falls under the global income classification: interest income (excluding interest taxed separately), dividend income (excluding dividends taxed separately), real estate rental income, business income and professional income, employment income, and other income. Taxable income is computed as gross income less all allowable deductions and allowances. Income is then aggregated and taxed at progressive rates.

INCOME TAX 2018 - 2019
TAXABLE INCOME, KRW (US$)	TAX RATE
Up to 12 million (US$10,811)	6%
12 million - 46 million (US$41,411)	15% on band over US$10,811
46 million - 88 million (US$79,279)	24% on band over US$41,411
88 million - 150 million (US$135,135)	35% on band over US$79,279
150 million - 300 million (US$270,270)	38% on band over US$135,135
300 million - 500 million (US$450,451)	40% on band over US$270,270
Over 500 million (US$450,451)	42% on all income over US$450,451
Source: Global Property Guide

INCOME TAX 2017
TAXABLE INCOME, KRW (US$)	TAX RATE
Up to 12 million (US$10,811)	6%
12 million - 46 million (US$41,411)	15% on band over US$10,811
46 million - 88 million (US$79,279)	24% on band over US$41,411
88 million - 150 million (US$135,135)	35% on band over US$79,279
150 million - 500 million (US$450,451)	38% on band over US$270,270
Over 500 million (US$450,451)	40% on all income over US$450,451
Source: Global Property Guide

Residents earning global income are entitled to deduct KRW1,500,000 (US$862) multiplied by the number of persons in the taxpayer´s family. Qualified family members are as follows:

• The resident taxpayer himself
• A spouse earning less than KRW1 million (US$862) per year
• A lineal ascendant dependent over 60 years old for males and over 55 years old for females
• A lineal descendant up to 20 years old
• A handicapped lineal descendant
• A sibling less than 20 years old or over 60 years old
• Other members of the household supported by the taxpayer

The following additional deductions are given wherein the taxpayer, his spouse, or one of his dependents are:

• Over 65 years old: KRW1 million (US$862)
• Over 70 years old: KRW1.5 million (US$1,293)
• Handicapped: KRW2 million (US$1,961)
• Married woman having her spouse: KRW500,000 (US$431)
• Head of the family with dependents but without a spouse: KRW500,000 (US$431)
• For every lineal descendant under 6 years old: KRW1 million (US$862)

A taxpayer can avail of the standard deduction of KRW1 million (US$862) instead of claiming the deductions enumerated above.

CAPITAL GAINS TAX

Individuals, including personal companies, earning capital gains when selling properties are subject to capital gains tax at progressive rates.

CAPITAL GAINS TAX 2018 - 2019
TAXABLE INCOME, KRW (US$)	TAX RATE
Up to 12 million (US$10,811)	6%
12 million - 46 million (US$41,411)	15% on band over US$10,811
46 million - 88 million (US$79,279)	24% on band over US$41,411
88 million - 150 million (US$135,135)	35% on band over US$79,279
150 million - 300 million (US$270,270)	38% on band over US$135,135
300 million - 500 million (US$450,451)	40% on band over US$270,270
Over 500 million (US$450,451)	42% on all income over US$450,451
Source: Global Property Guide

The taxable gain is computed by deducting the following from the gross amount: necessary expenses (acquisition costs, improvement costs, transfer costs, and other capital expenditures), special deduction for the holding period, and standard deductions for capital gains. There is no inflation-adjustment of capital gains.

A special deduction from the gross amount is also given for long-term holding and the deduction rate depends on the number of years the property was held:

SPECIAL DEDUCTION FOR CAPITAL GAINS
HOLDING PERIOD	DEDUCTION
3 years - 4 years	10%
4 years - 5 years	12%
5 years - 6 years	15%
6 years - 7 years	18%
7 years - 8 years	21%
8 years - 9years	24%
9 years - 10 years	27%
Over 10 years	30%
Source: Global Property Guide

Capital gains realized from selling a resident´s primary residence are not taxed. To qualify for this exemption, the property must be held by the owner for at least three years and must not be luxurious or not more than KRW900 million (US$810,811).

This exemption is extended to a second house in cases where the taxpayer acquires a rural house located in areas other than Seoul and Kyunggi-do by inheritance or for the purpose of returning to a farming lifestyle.

PROPERTY TAX

Property Tax

Annual property taxes are levied between 0.15% to 0.50%, depending on location, type of building, etc. To counter speculation, the government proposes to raise sharply the property tax base of apartments in designated speculation areas.

GENERAL COMBINED PROPERTY TAX
TAX BASE, KRW (US$)	TAX RATE
Up to 50,000 (US$45)	0.20%
50,000 - 100,000 (US$90)	0.30%
Over 100,000 (US$90)	0.50%
Source: Global Property Guide

SPECIAL COMBINED PROPERTY TAX
TAX BASE, KRW (US$)	TAX RATE
Up to 200,000 (US$180)	0.20%
200,000 - 1 million (US$900)	0.30%
Over 1 million (US$900)	0.40%
Source: Global Property Guide

Separate property taxes can be levied:

• Land is generally taxed at 0.20%
• Buildings are generally taxed at 0.25%
• House villas are taxed at 4%
• Houses other than villas are taxed at progressive rates, from 0.15% to 0.50%

PROPERTY TAXES ON HOUSES (OTHER THAN VILLAS)
TAX BASE, KRW (US$)	TAX RATE
Up to 40,000 (US$36)	0.15%
Up to 40,000 - 1 million(US$900)	0.30%
Over 1 million (US$900)	0.50%
Source: Global Property Guide

Comprehensive Real Estate Holding Tax

Property owners whose properties exceed a certain threshold amount are liable to pay the comprehensive real estate holding tax.

Comprehensive real estate tax is levied between 0.5% and 2% for residential houses that exceed KRW600 million (US$517,241).

COMPREHENSIVE REAL ESTATE HOLDING TAX ON RESIDENTIAL HOUSES
TAX BASE, KRW (US$)	TAX RATE
Up to 600 million (US$540,541)	0.50%
600 million - 1.2 billion (US$1,081,081)	0.75%
1.2 billion - 5 billion (US$4,504,505)	1.00%
5 billion to 9.4 billion (US$8,468,469)	1.50%
Over 9.4 billion (US$8,468,469)	2.00%
Source: Global Property Guide

Comprehensive real estate holding tax is levied at different rates, depending on the classification of land.

COMPREHENSIVE REAL ESTATE HOLDING TAX ON LAND
TAX BASE, KRW (US$)	TAX RATE
Up to 1.5 billion (US$1,351,351)	0.75%
1.5 billion - 4.5 billion (US$4,054,054)	1.50%
Over 4.5 billion (US$4,054,054)	2.00%
Source: Global Property Guide

COMPREHENSIVE REAL ESTATE HOLDING TAX ON LAND ATTACHED TO BUILDINGS
TAX BASE, KRW (US$)	TAX RATE
Up to 20 billion (US$18,018,018)	0.50%
20 billion - 40 billion (US$36,036,036)	0.60%
Over 40 billion (US$36,036,036)	0.70%
Source: Global Property Guide