Review the safety budget before tendering and settlement
Korean construction safety and health management expenditure is a separately allocated project cost for preventing occupational injuries and health harm.
An overall house-building quote or a bundle of receipts at completion can hide two separate issues: an insufficient original allocation and unsupported expenditure.
This calculator assesses a minimum allocation candidate from material and direct-labour costs, then compares the actual contract budget with the expenditure ledger.
The evidence changes through the project.
Before contracting, obtain the cost breakdown and supplied-material schedule; during construction, record the purpose and payment evidence; at completion, obtain confirmation from the client or supervisor.
The statutory candidate never automatically becomes the actual contract budget.
A quote shortfall and an unused budget balance remain separate results.
Before tendering
Check the construction type, assessment base and separate contract item.
Compare the announced and allocated amounts.
During work
Record purpose and evidence by category.
Keep unresolved expenditure visible until it is checked.
At settlement
Deduct confirmed eligible spending from the actual budget.
Discuss the reduction review with the client.
2026 Korean rules and supported contracts
This is a Korea-based calculator using Article 72 of the Occupational Safety and Health Act and MOEL Notice 2025-11.
All monetary inputs and results are KRW; the classifications and rates are not rules for another jurisdiction.
The worksheet supports evidence review and does not replace the client or competent authority decision.
Notice 2025-11 took effect on February 12, 2025.
Under the supplement to Notice 2024-53, the increased Annex 1 rates apply to new contracts signed on or after January 1, 2025.
The notice number 2025-11 does not mean an effective date in November 2025.
KRW 20 million scope threshold
Article 3 covers qualifying construction with a total project value of at least KRW 20 million.
An annual unit-price contract uses the full contracted value rather than each small work order.
Separately tendered works are considered by individual contract, while annual stages require review of the entire project.
Confirm the relevant contract scope with the client before entering amounts.
Being outside this budget threshold does not remove site safety duties.
The expenditure review date must fall in 2026.
Initial allocations for contracts before 2025 require historical rates.
Changed contracts require a review of the previous safety budget, proportional changes in the assessment base and any reassessment conditions.
The calculator withholds a new minimum allocation for those contracts, while a confirmed current contract budget can support a separate 2026 expenditure review.
Contract and start dates check the sequence of documents; the start date alone does not select new rates.
For quotes before signing, enter planned contract and start dates to assess an allocation candidate; settlement is withheld before construction starts.
Recheck any rule changes before signing.
Project value and assessment base have different meanings
Itemised costs
Start with direct materials, indirect materials and direct labour.
Enter qualifying client-supplied materials or finished products separately for the included and excluded comparison.
Do not add VAT, indirect labour, expenses, general overhead or profit to this itemised base.
No breakdown
Article 4(1)(3) and the official guide use 70% of the total project value as the included base.
That confirmed total includes VAT and client-supplied materials.
The excluded base is this 70% base minus the qualifying material or finished-product amount.
First check whether the quoted contract amount excludes VAT or client-supplied materials.
Do not add materials that are already in the confirmed total.
For the unitemised method, taking 70% of a total after removing supplied materials is different from the official calculation.
The value used for a VAT-exempt house project should not automatically be treated as its tax-reporting supply price.
The official guide addresses exempt-contract wording too; this tool does not add tax automatically and requires a client-confirmed allocation total.
Not every delivered product qualifies for the special comparison.
Check the manufacturing, delivery and installation contracts, the cost composition and whether another installation contractor performs the work.
Do not include an item belonging to a different installation contract or enter the same supplied-material cost again as direct materials.
Rates by construction type and assessment base
Use the small-base rate below KRW 500 million, the middle rate plus a fixed amount from KRW 500 million to less than KRW 5 billion, and the large-base rate from KRW 5 billion.
A confirmed health-manager appointment category uses the dedicated Annex 1 column without a fixed amount.
Confirm that classification under the applicable requirements, including Enforcement Decree Annex 5, rather than inferring it solely from one monetary input.
Annex 1 rates and fixed amounts in KRW, applicable to new contracts from 2025 and reviewed under 2026 Korean rules| Type | Below 500 million | 500 million to under 5 billion | Fixed amount | 5 billion or more | Health-manager category |
|---|
| Building construction | 3.11% | 2.28% | 4,325,000 | 2.37% | 2.64% |
| Civil engineering | 3.15% | 2.53% | 3,300,000 | 2.6% | 2.73% |
| Heavy construction | 3.64% | 3.05% | 2,975,000 | 3.11% | 3.39% |
| Special construction | 2.07% | 1.59% | 2,450,000 | 1.64% | 1.78% |
Annex 5 distinguishes building, civil engineering, heavy and special construction.
An independent civil or heavy-construction contract can retain its classification even when associated with a building.
Where different types form one project without separate tendering, use the type with the greatest project value.
A low rate for a small subsidiary trade should not be applied to the whole project.
Supplied-material comparison and worked examples
Comparison formula
Let f be the assessment function for the construction type, I the included base and E the excluded base.
Minimum allocation candidate = min(f(I), f(E) × 1.2).
Each base uses its own rate band and fixed amount.
Multiply the entire excluded assessment, including its fixed amount, by 1.2.
If there are no qualifying comparison materials, use the included assessment alone.
Building: 700 million versus 500 million
Direct materials of KRW 300 million, indirect materials of KRW 50 million, direct labour of KRW 150 million and comparison materials of KRW 200 million give I = KRW 700 million and E = KRW 500 million.
Included: 700 million × 2.28% + KRW 4,325,000 = KRW 20,285,000.
Excluded: 500 million × 2.28% + KRW 4,325,000 = KRW 15,725,000; multiplying by 1.2 gives KRW 18,870,000.
The smaller candidate is KRW 18,870,000.
An actual contract budget of KRW 18,000,000 has a KRW 870,000 shortfall.
Materials cross the 500-million band
For a building project with E = KRW 400 million and I = KRW 600 million, the included assessment uses 2.28% and the fixed amount to give KRW 18,005,000.
The excluded assessment uses 3.11% and gives KRW 12,440,000.
Its 1.2 multiple, KRW 14,928,000, is the candidate.
Review both assessments when the supplied materials cause different bands.
An unitemised total of KRW 1 billion with KRW 200 million of qualifying supplied materials gives I = KRW 700 million and E = KRW 500 million, matching the first example.
Compare the unrounded amounts, then round only the minimum candidate upward to a whole KRW.
This is a calculator convention to avoid understating the candidate, not a claim that the notice specifies a special rounding rule.
Confirm actual contract rounding with the client.
Step-by-step use
- Enter the contract, start and 2026 review dates, then select initial allocation or changed contract.
Use document dates, or planned dates for a quote before signing; do not treat a changed contract as a new allocation of the whole value.
- Confirm construction scope, type and the health-manager classification.
Keep uncertain conditions unresolved and inspect the pending reasons.
- Enter the confirmed total and choose itemised or 70% estimated bases.
Separate materials, direct labour and qualifying comparison items where a breakdown exists.
- Enter the actual safety budget in the contract.
Blank means unknown; zero means a confirmed omission.
- Enter expenditure by category and check eligibility and supporting evidence separately.
Add rows to separate amounts with different eligibility or evidence, and do not count smart equipment again under ordinary facilities or risk assessment.
- Calculate and review assessment branches, the quote shortfall, settlement range, expenditure categories and progress reference.
After editing, calculate again before saving a TXT worksheet or printing it for review with the client or supervisor.
Settlement uses the actual contract budget
Article 8 permits the client to reduce the contract amount or request a refund for safety expenditure used for another purpose or left unused.
This calculator provides a review worksheet, not an automatic determination.
If the allocation exceeds the statutory minimum, settlement uses the actual contract allocation rather than replacing it with the smaller statutory candidate.
Keep unresolved expenditure separate
Only expenditure with both confirmed eligibility and checked evidence enters accepted amount A.
Rejected amount D, category-cap excess X and unresolved amount U remain separate; A + D + X + U equals total expenditure entered.
With only A accepted, the unused balance is max(0, C − A).
If all U becomes additionally accepted, the balance is max(0, C − A − U).
Where U remains, the tool withholds a single reduction amount and displays this arithmetic range.
In the hypothetical screen example, C is KRW 18,000,000.
Confirmed wages of KRW 8,000,000, facilities of KRW 4,000,000 and PPE of KRW 2,000,000 are accepted.
Smart equipment costing KRW 4,000,000 is capped at KRW 3,600,000, so A is KRW 17,600,000.
Education of KRW 500,000 is ineligible, the smart excess is KRW 400,000 and risk-assessment expenditure of KRW 1,000,000 is unresolved.
All KRW 19,500,000 of entered expenditure is classified.
The reduction / refund review range is KRW 0–400,000; the KRW 870,000 allocation shortfall remains separate.
The low end assumes all unresolved costs become accepted and is only an arithmetic possibility.
Purpose, individual caps and evidence review may permit less additional expenditure.
Do not add rejected expenditure to the unused balance again, as that deducts the same amount twice.
Accepted expenditure above the actual budget is displayed separately and does not establish an automatic right to additional payment.
Check category conditions and caps first
Article 7 covers manager wages, safety facilities, PPE, diagnostics, education, worker health prevention, self-constructor technical guidance, head-office safety organisations and qualifying risk-assessment improvements.
The tool separates smart equipment from ordinary facilities to apply its cap.
A product labelled for safety may still require further review if it also serves construction convenience, quality control, environmental management or complaints.
Enter up to 100 expense rows.
Within the same category, keep evidenced and unresolved amounts in separate rows.
Smart equipment, head-office and risk-assessment caps apply to the combined confirmed total in each category; splitting an amount into rows does not increase the cap.
Smart equipment: 20%
In 2026, 100% of qualifying purchase / rental costs is considered before applying a cap of 20% of the allocated contract budget.
Do not use the 70% recognition fraction from 2025.
Head office: 5%
First check the covered business and dedicated organisation requirements, including at least three staff.
Confirmed costs remain subject to the 5% cap.
Risk assessment: 15%
Check the committee or joint consultation decision and, where applicable, worker input and consultative-body records.
Costs above 15% of the allocated budget are shown separately.
The review date does not change the rules applicable to past spending.
For pre-2026 costs, enter only an eligible amount verified against historical recognition fractions and caps; keep unverified amounts in separate unresolved rows.
Wages are not automatically accepted in full.
First verify the eligible amount, including one-half of non-exclusive safety / health manager wages and travel, supervisor allowances limited to 10% of wages, and costs incurred after appointment reporting to the local labour office.
Do not confuse the client technical-guidance contract with qualifying payments by a self-constructor.
Check detailed wage and item eligibility against the site conditions and official guide; keep unverified portions unresolved.
Progress references, confirmation and retention
Certified work progress
Annex 3 specifies expenditure of at least 50% at progress from 50% to under 70%, at least 70% from 70% to under 90%, and at least 90% from 90% progress.
It gives no minimum ratio below 50%.
The client may set a different schedule based on project characteristics.
The reference amount and provisional shortfall do not determine safety compliance or an automatic violation.
Article 9 requires client or supervisor confirmation at least once every six months after construction starts.
If the project ends within six months, confirmation is needed at completion; relevant parties can also inspect records at other times.
Enforcement Rule Article 89 requires monthly expenditure records for projects of KRW 40 million or more and retention for one year after completion.
Notice Article 10 addresses the execution budget and records held at the site for that scale.
Keep the KRW 20 million allocation threshold separate from the KRW 40 million record threshold.
Link dates, items, quantities, payees, payment amounts, purpose checks and appointment / education / consultation evidence to monthly records.
A receipt alone does not confirm eligibility.
Keeping eligibility and evidence as separate checks makes it easier to identify the documents still needed.
Practical situations and limitations
House-building quote review
Check that the legal budget is listed separately in the construction quote.
If the confirmed type and base produce a higher candidate than the actual allocation, compare the missing-budget evidence before negotiating.
Completion evidence review
Keep uncertain items or wages before appointment reporting unresolved.
A wide settlement range indicates that eligibility and evidence need to be checked before agreeing an amount.
Safety-management plan costs under the Construction Technology Promotion Act are a different system from occupational safety and health management expenditure.
This tool does not perform a site diagnosis, predict accidents, calculate fines, automatically classify item eligibility or proportionally adjust amended budgets.
Historical contracts, mixed types, separately tendered works, unusual supply / installation arrangements and client-specific schedules require the actual contract conditions.
Rules and supplements may change in later years; do not reuse a 2026 result automatically for future contracts.
Frequently asked questions
Is exactly KRW 20 million within the threshold?
Yes, where it is qualifying construction and the relevant total is exactly KRW 20 million.
First confirm the contract scope for unit-price, separately tendered and annual-stage work.
Should VAT be added to the assessment base?
Do not add it arbitrarily to itemised material and direct-labour costs.
For the unitemised 70% method, obtain the confirmed total including VAT and supplied materials in accordance with the official guide.
Can supplied materials simply be excluded?
For qualifying comparison items, compare the included assessment with 1.2 times the full excluded assessment.
First confirm whether an item belongs to this contract, including any separate installation arrangement.
Does the fixed amount also receive the 1.2 multiplier?
Yes.
Where the excluded base is in the middle band, multiply its rate-based assessment plus fixed amount by 1.2.
Each assessment base uses its own band and fixed amount.
How do zero and unknown differ?
A blank actual contract budget is unknown, while zero records a confirmed omission.
Unknown expenditure eligibility or evidence remains a separate amount, and a single refund result is withheld.
Does a receipt make the whole cost eligible?
No.
Evidence and eligibility are separate.
Check purpose, timing, appointment or consultation conditions and category caps; both eligibility and evidence must be confirmed for accepted spending.
Can a changed contract be recalculated with the new rates?
Check the existing allocation, proportional adjustment and any reassessment conditions separately.
The tool withholds a new minimum and reviews only the expenditure ledger against a confirmed amended budget.
Is the reduction review an established refund?
No.
Notice Article 8 requires evidence review and the client decision.
Unresolved costs produce an arithmetic range.
Do not automatically offset an allocation shortfall or add rejected expenditure again.
Official sources and update dates
Official sources were verified on October 7, 2026.
The National Law Information OPEN API returned current administrative rule ID 2100000254546, Annexes 1, 3 and 5 and the supplements.
Act MST 283449 and Enforcement Rule MST 288431 were checked in their versions effective August 1, 2026, including Articles 72 and 89.
Distinguish notice commencement on 2025-02-12, new-contract rates from 2025-01-01, and 100% smart-cost recognition from 2026-01-01.
Recheck the rates, contract application dates, eligible items, caps, appointment classification and actual settlement conditions when rules or evidence change.
Resolve missing documents and uncertain contract facts before relying on a calculated amount.
Prepare the calculation and evidence together
Enter the confirmed breakdown and actual contract allocation above, then review both assessment branches and unresolved expenditure.
Save a TXT worksheet or print the comparison alongside the contract and expenditure records to identify what is needed for quote negotiation or completion settlement.
Use the house-construction calculator for the whole building budget and the relevant mutual-aid or insurance tool for those separate costs.