Tax insights
Recurring tax questions for foreign nationals, foreign companies and overseas Koreans. Deadlines, rates and the conditions for deductions were checked article by article against the Korean Law Information Center, and each article lists the provisions relied on with their enforcement dates.
- Overseas accounts
Overseas financial account reporting: check the exemptions first
A resident or domestic corporation holding overseas financial accounts whose aggregate balance exceeded KRW 500m on any month-end of the year must report between 1 and 30 June of the following year (Act on Adjustment of International Taxes, Art. 53(1); Enforcement Decree, Art. 92). Foreign residents under the proviso to Income Tax Act Art. 3(1), overseas Koreans with 182 days or less of residence in Korea and others are exempt under Art. 54.
Overseas financial account reporting: check the exemptions first — Read more - Non-resident tax
Non-resident rental income in Korea: taxed on an aggregated basis
Income from leasing real estate or rights over real estate located in Korea is a non-resident’s domestic-source real-estate income (Income Tax Act, Art. 119, subpara. 3). A non-resident with such income is taxed on an aggregated basis (Art. 121(2)), so filing and payment in Korea must be prepared even while living abroad.
Non-resident rental income in Korea: taxed on an aggregated basis — Read more - Foreign corporation tax
Foreign liaison offices in Korea: 10 February filing and PE line
A liaison office of a foreign corporation that carries on no revenue-generating activity in Korea and performs only non-business functions such as liaison and market research must submit the status information prescribed by Presidential Decree to the district tax office by 10 February of the following year (Corporate Tax Act, Art. 94-2(1)). If its actual activities meet the domestic place of business test in Article 94, however, it is not a liaison office.
Foreign liaison offices in Korea: 10 February filing and PE line — Read more - Expat income tax
Foreign residents’ overseas income: the five-in-ten-years rule
A foreign resident whose total period of domicile or residence in Korea in the ten years before the end of the tax year is five years or less is taxed on foreign-source income only to the extent it is paid in Korea or remitted to Korea (Income Tax Act, Art. 3(1), proviso). From the tax year in which the total exceeds five years, all income is taxable under the general rule.
Foreign residents’ overseas income: the five-in-ten-years rule — Read more - Foreign employees
Foreign employee 19% flat tax in Korea: when it pays off
Where a foreign executive or employee (other than a daily worker) first began working in Korea on or before 31 December 2026, the tax on employment income received up to the tax year ending within 20 years of the first day of work may be 19% of that income (Restriction of Special Taxation Act, Art. 18-2(2)). Non-taxation, deductions, reductions and credits then generally do not apply (Art. 18-2(3)).
Foreign employee 19% flat tax in Korea: when it pays off — Read more - Bookkeeping & payroll
Foreign employees and social insurance: pension reciprocity
Article 126(1) of the National Pension Act makes a foreign national employed at a covered workplace or residing in Korea a compulsory subscriber, subject to a reciprocity proviso: it does not apply where the person’s home country does not extend its corresponding pension scheme to Korean nationals.
Foreign employees and social insurance: pension reciprocity — Read more - Korea–U.S. income tax
Korea–U.S. double taxation: residency, scope, credit limit
A Korean resident who has paid foreign income tax on foreign-source income may credit it up to a limit: Korean global income tax × (foreign-source income ÷ total global income) (Income Tax Act, Art. 57(1)). It is not a full refund but a cap at the Korean-rate equivalent.
Korea–U.S. double taxation: residency, scope, credit limit — Read more - Foreign corporation tax
Liquidation tax: three months from the month-end of final asset value
A dissolved Korean (domestic) corporation files corporate tax on liquidation income within three months from the last day of the month in which the value of residual assets is finalised (Corporate Tax Act, Art. 84(1)). Liquidation income is residual assets less total equity as at the dissolution registration date (Art. 79(1)).
Liquidation tax: three months from the month-end of final asset value — Read more - Cross-border inheritance
Non-resident estates get only the KRW 200m basic deduction
The KRW 500m lump-sum deduction (Inheritance Tax and Gift Tax Act, Art. 21(1)) and the financial-asset deduction (Art. 22(1)) apply only where inheritance commences "on the death of a resident". Only the KRW 200m basic deduction (Art. 18) covers the death of "a resident or a non-resident".
Non-resident estates get only the KRW 200m basic deduction — Read more - Cross-border transfers
Non-resident capital gains: the two-month return comes first
On transferring land or buildings, a preliminary return of the capital gains tax base is due within two months from the last day of the month of transfer (Income Tax Act, Art. 105(1)1). A non-resident’s domestic-source gains on real estate are taxed by classification in the same way as a resident’s (Art. 121(2)).
Non-resident capital gains: the two-month return comes first — Read more - Foreign corporation tax
The 20-day tax audit notice, and how to actually use it
Tax officials must give notice of the tax items, period and grounds 20 days before an audit begins (Framework Act on National Taxes, Art. 81-7(1)). A re-investigation requires 7 days, and notice may be omitted where evidence might be destroyed.
The 20-day tax audit notice, and how to actually use it — Read more
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Foreign-corporation tax, cross-border inheritance and gifts, Korea–U.S. income tax — we explain exactly how your own case is treated. Please get in touch.