Why your monthly pay isn't your salary divided by 12
Korean employers quote pay as a yearly amount before tax — the yeonbong (연봉). On a ₩45 million salary you might expect ₩3.75 million a month, but about ₩3,233,190 actually reaches your account. Four social insurance premiums and two income taxes come out first, about 14% of gross pay at this level. If you plan your rent and savings around the contract figure, you will be short every month.
The six deductions on a Korean payslip
| Deduction | Employee rate | Charged on |
|---|---|---|
| National Pension (국민연금) | 4.75% | Monthly income between ₩410,000 and ₩6,590,000 |
| Health insurance (건강보험) | 3.595% | Taxable pay |
| Long-term care insurance (장기요양보험) | 13.14% of the health premium | Health insurance premium |
| Employment insurance (고용보험) | 0.9% | Taxable pay |
| Income tax (소득세) | Progressive, 6%–45% | Income after deductions |
| Local income tax (지방소득세) | 10% of income tax | Income tax |
Your employer pays the same amount again for pension, health and long-term care insurance, a larger share of employment insurance, and all of the industrial accident insurance. None of that comes out of your pay.
The pension has a ceiling. It is charged only on monthly income up to ₩6,590,000, so the premium stops at ₩313,020 a month however much you earn. The limits are reset every July.
If you're a foreign employee
Korea's payroll rules apply to foreign employees in almost the same way as to Koreans. These are the differences that matter most.
National Pension
Foreign employees aged 18 to 59 are generally enrolled just like Koreans. You are excluded only in specific cases — for example when your home country's pension system does not cover Korean nationals, or when you hold a certificate of coverage under a social security agreement because you are still insured at home. If that applies to you, choose Exempt above.
When you leave Korea for good, you may be able to claim your contributions back as a lump-sum refund. It depends on your nationality: citizens of countries with a social security agreement or a reciprocity arrangement covering refunds — including the United States, Canada, Australia, Germany, France, India and the Philippines — can claim it, and so can anyone who paid in while holding an E-8, E-9 or H-2 visa. Some countries, including the United Kingdom, Ireland, New Zealand, China, Japan and Vietnam, are not on the refund list published in June 2026. Check your country on the National Pension Service page linked below.
Employment insurance
Employment insurance, which funds unemployment benefits, is compulsory for F-2, F-5 and F-6 visa holders, as it is for Koreans. With most other visas the employee's 0.9% applies only if you have opted in, so many foreign employees never see it on their payslip. Check yours and pick the matching option.
The 19% flat tax option
Foreign employees who started working in Korea by 31 December 2026 can choose a single 19% income tax rate (20.9% with local income tax) instead of the progressive rates, for up to 20 years from their first day of work in Korea. The flat rate applies to your whole pay: tax-free allowances, deductions and tax credits are all given up. It usually helps only people with a high salary and few deductions. You choose it year by year at the year-end tax settlement, or ask your employer to withhold at the flat rate.
A government tax reform proposal announced in 2026 would raise the rate to 21% from 2027. It still has to pass the National Assembly, so check the final law before relying on it. This calculator uses the progressive rates.
How the tax is worked out
- Taxable pay — monthly pay minus tax-free allowances.
- Social insurance — each premium is a percentage of taxable pay. Long-term care is the odd one out: it is a percentage of the health insurance premium.
- Earned income deduction — a set amount by income band, up to ₩20 million a year.
- Personal and premium deductions — ₩1,500,000 for each dependent, plus a year of pension, health, long-term care and employment insurance premiums. What remains is your tax base.
- Progressive rates — 6%–45% by bracket (table below).
- Tax credits — the earned income tax credit and the child tax credit (₩250,000 for the first child, ₩300,000 for the second and ₩400,000 for each further child) are subtracted. Local income tax adds 10% on top.
- The better of two options — claiming the insurance premium deduction means giving up the ₩130,000 standard tax credit, so the calculator uses whichever leaves less tax.
2026 income tax rates
| Tax base (per year) | Rate | Progressive deduction |
|---|---|---|
| Up to ₩14 million | 6% | – |
| ₩14 million – ₩50 million | 15% | ₩1,260,000 |
| ₩50 million – ₩88 million | 24% | ₩5,760,000 |
| ₩88 million – ₩150 million | 35% | ₩15,440,000 |
| ₩150 million – ₩300 million | 38% | ₩19,940,000 |
| ₩300 million – ₩500 million | 40% | ₩25,940,000 |
| ₩500 million – ₩1 billion | 42% | ₩35,940,000 |
| Over ₩1 billion | 45% | ₩65,940,000 |
These are marginal rates. A tax base of ₩51 million is not taxed at 24% throughout: the first ₩14 million is taxed at 6%, the next ₩36 million at 15%, and only the last ₩1 million at 24%. Moving into a higher bracket therefore never lowers your take-home pay. The progressive deduction is a shortcut: multiply your whole tax base by its bracket rate and subtract it.
Take-home pay by salary
Single, ₩200,000 tax-free meal allowance, 2026 rates · monthly amounts in KRW
| Salary | Gross monthly | Deductions | Take-home | Deduction rate |
|---|---|---|---|---|
| ₩24 million | 2,000,000 | 189,180 | 1,810,820 | 9.5% |
| ₩30 million | 2,500,000 | 254,870 | 2,245,130 | 10.2% |
| ₩36 million | 3,000,000 | 344,170 | 2,655,830 | 11.5% |
| ₩42 million | 3,500,000 | 459,260 | 3,040,740 | 13.1% |
| ₩48 million | 4,000,000 | 573,280 | 3,426,720 | 14.3% |
| ₩54 million | 4,500,000 | 692,220 | 3,807,780 | 15.4% |
| ₩60 million | 5,000,000 | 811,180 | 4,188,820 | 16.2% |
| ₩72 million | 6,000,000 | 1,049,060 | 4,950,940 | 17.5% |
| ₩84 million | 7,000,000 | 1,363,090 | 5,636,910 | 19.5% |
| ₩100 million | 8,333,333 | 1,746,230 | 6,587,103 | 21.0% |
| ₩120 million | 10,000,000 | 2,271,070 | 7,728,930 | 22.7% |
The deduction rate is about 9% on a ₩24 million salary and about 23% on ₩120 million, because income tax rises faster than pay. A raise always increases take-home pay, but by less than the headline figure.
Tax-free allowances
- Meal allowance — up to ₩200,000 a month. The most common one.
- Car allowance — up to ₩200,000 a month, if you use your own car for work and are not reimbursed for actual costs.
- Childcare allowance — up to ₩200,000 a month for children aged 6 or under.
- Research allowance — up to ₩200,000 a month for qualifying researchers.
Tax-free allowances are left out of both income tax and the social insurance base, which is why they raise take-home pay. They have to be in your employer's pay rules and actually paid; a lower pension base also means a slightly lower pension later.
Words you'll see on a Korean payslip
| Korean | Meaning |
|---|---|
| 연봉 | Annual salary before tax |
| 기본급 | Base pay |
| 식대 | Meal allowance (usually tax-free) |
| 연장근로수당 | Overtime pay |
| 국민연금 · 건강보험 · 장기요양보험 · 고용보험 | The four social insurance deductions |
| 소득세 · 지방소득세 | Income tax · local income tax |
| 공제액 계 | Total deductions |
| 실지급액 (차인지급액) | Net pay — what reaches your account |
| 연말정산 | Year-end tax settlement, done each February |
What this calculator doesn't include
- Year-end deductions and credits — medical and education costs, card spending, rent, pension savings and donations. These usually make your real tax lower than shown here.
- Monthly withholding — employers withhold income tax using the National Tax Service's simplified tax table, so your payslip can differ by a little each month. The difference is settled in February.
- Bonuses — taxed when they are paid, not spread over the year.
- Salaries that include severance — enter 12/13 of the figure (see the questions below).
- The flat tax option and tax treaties — some tax treaties exempt teachers or researchers from Korean income tax for a limited period.
- Non-resident tax status — if you are not a Korean tax resident, fewer deductions apply.
For a binding figure, use the National Tax Service's Hometax year-end settlement preview or ask your payroll team.