Korea Year-End Tax Settlement Calculator

Estimate your Korean year-end tax settlement refund or extra payment from salary, family, card spending, pension/IRP, and the main tax credits, based on 2026 rules.

Income and withholding

Family

Card and cash spending (income deduction)

Savings and credits

Estimated additional tax

- ₩2,186,875

Tax already withheld₩2,000,000
Final tax (incl. local)₩4,186,875

How it is calculated

Taxable salary
₩50,000,000
Earned-income deduction
− ₩12,250,000
Personal deduction
− ₩1,500,000
Card spending deduction
− ₩1,675,000
Taxable income
₩34,575,000
Computed tax
₩3,926,250
Total tax credits
− ₩120,000
Determined tax
₩3,806,250

Tax credits applied

Insurance credit
₩120,000

This calculator is based on Korean year-end tax settlement rules for 2026 (2025 income), including the increased child credit and the marriage credit. It exposes the highest-impact items; granular sub-items (such as fertility-treatment medical cost or preschool tuition) are treated as zero. It is a planning estimate, so confirm the final figure through the National Tax Service Hometax year-end settlement.

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What is the Korea year-end tax settlement calculator?

Year-end tax settlement (yeonmaljeongsan) compares the income tax withheld from an employee over the year with the tax actually due, producing a refund or an extra payment. This calculator estimates that figure before the settlement, which runs every February, so you can plan ahead.

It is based on the 2026 settlement (income earned January to December 2025) and reflects recent changes such as the larger child credit, the new marriage credit, and the credit-card child bonus.

Korea-based calculator

This tool is based on Korean income tax law for the 2026 year-end settlement. It is a planning estimate for employees, not an official assessment.

  • Employees who want to estimate their refund in advance
  • Anyone optimizing income deductions and tax credits
  • People who married or had a child this year
  • Those contributing to pension savings or an IRP for the credit
  • Renters without a home checking the monthly-rent credit

Key 2026 changes

1. Larger child tax credit

As part of the response to low birth rates, the child credit was raised.

  • First child: KRW 150,000 to KRW 250,000
  • Second child: KRW 150,000 to KRW 300,000
  • Third and beyond: KRW 300,000 to KRW 400,000 each

2. New marriage tax credit

Couples who register their marriage between 2024 and 2026 receive KRW 500,000 per person, up to KRW 1,000,000 per couple. It applies once in a lifetime, in the year of registration.

3. Credit-card child bonus

For employees earning KRW 70 million or less, the credit-card deduction limit rises by KRW 500,000 per child (KRW 250,000 per child above KRW 70 million). Gym and pool fees also joined the credit-card deduction (30%) from July 2025.

How the settlement is calculated

Step 1: Income deductions

From taxable salary, subtract the earned-income deduction, personal deductions (self, spouse, dependents, elderly, disabled), the card-spending deduction, and the housing subscription deduction.

Step 2: Taxable income and computed tax

Taxable income is salary minus deductions. The progressive income tax brackets (6% to 45%) then give the computed tax.

Step 3: Tax credits

Subtract credits for children, marriage, insurance, medical, education, donation, monthly rent, and pension/IRP. The result is the determined tax.

Step 4: Refund or extra payment

Add 10% local income tax to get the final tax, then compare it with the tax already withheld. If you withheld more, you get a refund; if less, you pay the difference.

Major deduction and credit items

Card spending (income deduction)

Only spending above 25% of salary qualifies. Credit cards are deducted at 15%, while debit cards and cash receipts are deducted at 30%, with extra limits for traditional markets, public transport, and culture.

Pension savings and IRP (tax credit)

Pension savings and IRP contributions earn a credit of 16.5% for salary up to KRW 55 million and 13.2% above it, within annual contribution limits. This is one of the most effective ways to increase a refund.

Medical, insurance, education, rent

  • Medical: 15% of spending above 3% of salary; no cap for the taxpayer, those 65+, and the disabled.
  • Insurance: 12% of protection-type premiums, up to KRW 1 million.
  • Education: 15% within limits per child by school level.
  • Monthly rent: 17% for salary up to KRW 55 million, 15% up to KRW 80 million, for eligible no-home renters.

Frequently asked questions

Why did I owe extra instead of a refund?

A refund or extra payment depends on whether too much or too little was withheld during the year and on how many deductions and credits you claim. Low withholding or few deductions can lead to an extra payment.

What is the most effective way to raise my refund?

Pension savings and IRP contributions are usually the most effective, giving a 13.2% to 16.5% credit. Using debit cards and cash receipts above the 25% threshold also helps.

Can both spouses claim the same dependent?

No. A dependent can be claimed by only one spouse. Generally the higher earner should claim dependents and large deductions to save more tax.

Where do I run the official settlement?

Through the National Tax Service Hometax year-end settlement service, which pre-fills most of your deduction data. Use this calculator to plan, then confirm there.

Tips

  • Contribute to pension/IRP: the highest-rate credit for most employees.
  • Use debit cards past the threshold: 30% versus 15% for credit cards.
  • Let the higher earner claim dependents: deductions are worth more at a higher bracket.
  • Keep medical and donation receipts: they add up across the year.
  • Claim the monthly-rent credit: eligible no-home renters often miss it.