Question 1

What is the flat tax rate for foreigners in Korea?

Accepted Answer

Foreign workers can elect a flat 19% income tax rate (+ 1.9% local tax = 20.9% total) instead of the progressive rates (6%–45%). This is available for up to 20 years from your first working day in Korea.

Question 2

When is flat tax better than progressive?

Accepted Answer

Flat tax becomes advantageous when your annual salary exceeds approximately ₩160 million. Below that, progressive taxation with deductions is usually cheaper.

Question 3

Can I switch between flat and progressive every year?

Accepted Answer

Yes. You choose your tax method during year-end settlement each year. You are not locked in.

Question 4

Are social insurance contributions different under flat tax?

Accepted Answer

No. National Pension, Health Insurance, and Employment Insurance contributions are the same regardless of which tax method you choose.

Question 5

What deductions am I giving up with flat tax?

Accepted Answer

Under flat tax, you cannot claim earned income deduction, personal exemptions, or earned income tax credit. The 19% applies to your entire gross salary.

Flat Tax vs Progressive Tax

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