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TAX RATES AND TAX CREDITS
A. Tax Rates Structure
The tax amount on global income is the aggregate of amounts calculated by applying each 
tax rate successively to the income in the relevant tax bracket:
 tax base of global income  tax rates
10 million Won or less 8%
10 ~ 40 million Won 0.8 million Won + 17% of the amount exceeding 10 million Won
40 ~ 80 million Won 5.9 million Won + 26% of the amount exceeding 40 million Won
over 80 million Won 16.3 million Won + 35% of the amount exceeding 80 million Won
The tax amount of retirement income is calculated by dividing the taxable income by the 
number of years of service, applying the tax rates, and again multiplying the amount by 
the number of years of service.
Tax rates on timber income are the same as those applied to global income.
B. Tax Credits
FOREIGN TAX CREDIT
Where a resident has paid or is to pay foreign income tax abroad, the tax amount payable 
is deducted from the income tax within the limit of an amount equivalent to an amount 
calculated by multiplying the income tax amount by the ratio of income from foreign 
sources to the total taxable income. If any foreign income tax amount paid or to be paid 
to a foreign government, exceeds the deduction limit, the excess amount may be carried 
forward to the taxable period to be terminated within five year from the taxable period 
following the current taxable period, and deducted within the deduction limit of that 
taxable period. An application for deduction shall be filed with the competent District Tax 
Office or the tax withholding agent not later than the end of the final tax return period or 
the end of the year-end adjustment period.
CREDIT FOR DIVIDEND INCOME (PARTIAL IMPUTATION SYSTEM)
Where a resident's dividend income from domestic corporations is counted in the global 
income, an amount calculated as follows is deducted from the global income tax amount.
¡©  15/100 of the corporate income tax attributable to the dividend in question will be 
added to the amount of dividend income actually received by a shareholder.
¡©  This figure will then be used to calculate the individual income tax of the shareholder.
¡©  Thereafter the 15/100 portion will be credited against the calculated individual income 
tax amount or will be refunded to the shareholder.
CREDIT FOR WAGE AND SALARY INCOME
The following amounts shall be credited against global income tax on wage and salary 
income. Where the amount of credit exceeds 500,000 Won, the credit is limited to 
500,000 Won.
   
 Total Tax  Amount of tax credit
up to W 500,000 55% of total tax
more than W 500,000 W 275,000 + 30% of amount over W 500,000
 In the case of daily worker, the amount of credit is limited to total tax multified by 
55%.
CREDIT FOR LOSS CAUSED BY DISASTER
If a resident has lost 30% or more of the total value of his business assets due to a 
disaster, the tax amount equivalent to the ratio of the value of lost assets to the value of 
total assets is deducted from the income tax amount.
CREDIT FOR BOOKKEEPING
If a person subject to Simple Book Keeping calculates his income amount on the basis of 
the entries in the book exhibited and entered, and submits the document in making a final 
return on tax base pursuant to the provisions of Presidential Decree, the outcome obtained 
by multiplying by 10/100 the amount calculated by multiplying the calculated global 
income tax amount or the calculated forestry income tax amount by the ratio of the sum 
of real estate rental income and business income calculated pursuant to the entries in the 
book from the global income, or the ratio of the forestry income calculated pursuant to 
the entries in the book to forestry income shall be the amount deducted. If the amount 
subject to deduction exceeds one million won, only one million won shall be deducted.