Tax Information

National Taxes

Income tax

• For an alien who has stayed in Korea for one year or less, income taxes are imposed on the income obtained during the length of his/her stay.
• For an alien who has stayed in Korea for over one year, all types of income taxes are imposed.

Corporate ta

• Corporate taxes are imposed on corporate income. Corporate taxes must be reported within three months from the last day of the month in which the last day of each business year falls.

Value-added tax

• Final consumer pays 10% of the product or service price.

Inheritance tax

• Inheritance taxes are imposed on inherited properties. An inheritor obligated to payment of inheritance taxes must report and pay inheritance taxes within six months from the last day of the month to which the day on which inheritance commences.

Special consumption tax

• Special consumption taxes are imposed on luxury items and services.

Education tax

• Education taxes are imposed for improving educational services and quality.

Traffic tax

• Traffic taxes are imposed on vehicle owners and used for repairing damaged roads and reducing environmental pollution.

Regional development tax

• Regional development taxes are imposed on water used for power generation. The taxes are generally used to secure resources required for balanced regional development, improvement of water quality, and protection of water resources.

Local Taxes

Acquisition tax

• Acquisition taxes are imposed on acquisition of real estate (land or buildings), automobiles, high-priced equipment, lumber, aircraft, golf membership, and resort membership, etc.

Registration tax

• Registration tax is a type of transaction tax levied on acquisition of real estate, vehicles, etc.

Property tax

• Property taxes are imposed on currently owned property. (Imposed on June 1 every year and paid between June 16 and 30)

Composite land tax

• Objective taxes to control an excessive ownership of land. Composite land taxes are laid on the gain from an increase in land prices. (Imposed on June 1 every year and paid between June 16 and 31)

Resident tax

• Resident taxes are used to improve the residential environment, welfare, and quality of life of residents.

Automobile tax

• Property taxes on multiple vehicle ownership and charges on road damages, environmental pollution, etc.

License tax

• License taxes are imposed on acquisition of licenses. (Imposed on June 1 every year and paid between June 16 and 30)
• All real estate transactions must be reported except in cases where permission has been granted.

Automobile tax

• Automobile taxes are imposed semiannually (June and December) and are based on engine capacities. The motor vehicle owner must pay several types of taxes. The owner of the land where the vehicle is purchased must pay registration taxes, acquisition taxes, and education taxes.
• License taxes are imposed every year (depending on the types of licenses). Automobile taxes are imposed semiannually (June and December, based on engine capacities). Education taxes are included in automobile taxes (30% of automobile taxes).

Real estate tax

• When selling real estate, the seller and purchaser pay several objective taxes based on the transaction cost. The purchaser pays acquisition taxes (2%), registration taxes (3%), and education taxes (0% of registration taxes). The seller pays income taxes (20%-60% of the difference between the purchase price and the selling price). When renting a house, the homeowner must pay the real estate agent’s fees. The homeowner or the real estate agent is responsible for all fees.
  ※ Note: Fees may vary depending on economic circumstances of Korea.

Tariffs/Import duties

• Items brought to Korea may be taxed depending on the types. Each individual must check duty-free items and the quantity of items. If the total purchase prices exceed $400, tariffs are imposed. Tariffs are levied even when items are delivered by parcel post or as luggage.
• The values of shipped items are included in the shipment prices. Separately shipped items must be attached with descriptions written by the owner. The owner should conduct the second customs declaration for baggage check.
  1) Reexport
  
  • If a nonresident brings non-tariff items to Korea, he/she is not exempt from tariffs. The tariff is subject to the origin of the passport. The owner has ownership of the items unless he/she leaves the country specified by the Visa.
  
  2) Item returned to Korea
  
  • Items purchased in or returned to Korea after you leave are not subject to tariffs.
  • Visit the website of the Korea Customs Service (http://www.customs.go.kr/) for further information.