Will ordinary acquisition tax cover a corporate property purchase?
This calculator checks Korean metropolitan acquisition-tax surcharges when a corporation acquires a shop, office or non-farmland parcel, or constructs a building.
The same price can produce different acquisition tax, local education tax and special tax for rural development depending on the company history, location and headquarters construction.
A housing calculator based only on home count and regulated housing areas does not resolve these corporate triggers.
For an owner-funded family company or rental business, an unexpected surcharge consumes cash that would otherwise fund the investment.
Discovering it just before settlement can make it difficult to renegotiate the transaction.
Check the corporate register, actual business establishments and parcel designation while comparing properties.
The tool provides estimates conditional on the facts you confirm, together with the information that still needs review.
Korean jurisdiction and 2026 rulesOfficial sources were checked on 2026-11-08; the supported acquisition window is 2026-10-01 through 2026-12-31.
Individual exemptions, tax relief, penalties and registration costs are excluded.
Comparisons for later dates hold the 2026 rules constant and do not establish future tax liability.
Separate headquarters construction from corporate metropolitan triggers
Article 13(1): headquarters construction
This covers qualifying newly built or extended buildings used for a head office or principal office, and the associated land, in an overcrowding control region.
Buying an existing office building is different.
This provision can remain relevant after the corporation has existed for more than five years.
Article 13(2): establishment and relocation
This concerns incorporation, branch establishment or relocation into a metropolitan area followed by qualifying property acquisition.
Acquisitions within five years after the relevant event include business and non-business property, including rental property.
If both provisions apply, Article 13(6) supplies the combined formula.
Do not calculate each surcharge separately and add the results.
Housing, factory establishment or expansion, farmland, trusts and mixed-use acquisitions involve further rules, so this tool sends them for separate review and withholds a payable estimate.
What to prepare and what the inputs mean
- Acquisition date and tax base: verify the tax base for the transaction rather than assuming the contract price always equals it.
Completion approval, registration or actual use can affect the legal acquisition date independently of settlement.
- Acquisition cause: the standard rate is 4% for supported non-farmland purchases and auction purchases, and 2.8% for original acquisitions.
Calculate purchased land and newly constructed buildings separately when their acquisition causes differ.
For an extension, confirm the taxable incremental value.
- Company and establishment history: check incorporation, new branches, relocations, movement into Seoul and dormant-company acquisition.
Use the most recent trigger relevant to this property and confirm the complete history.
An old incorporation date alone does not rule out a later trigger.
- Headquarters construction: check the building register, drawings, actual use and associated land.
Partial headquarters use may require an allocation of area and value before a rate can be applied.
Do not automatically apply the headquarters result to an entire mixed-use property.
A blank amount is unknown, rather than a confirmed zero.
Enter a positive tax base in whole KRW.
The numeric field preserves the editing draft so clearing and replacing an amount does not force it to a minimum value.
When evidence is missing, retain the unknown selection and collect the documents instead of inventing a number or selecting an exclusion.
Overcrowding regions, industrial complexes and industrial zones
The metropolitan area used by this tax is not all of the Seoul Capital Area or every metropolitan city in Korea.
Start with the overcrowding control region in Annex 1 to the Enforcement Decree of the Seoul Metropolitan Area Readjustment Planning Act.
For corporate establishment under Article 13(2), designated industrial complexes are excluded.
Parts of Incheon, Namyangju and Siheung have local exclusions, so a city name is insufficient to classify a parcel.
An industrial complex can still have a headquarters surcharge
An industrial complex within the overcrowding control region may remove the Article 13(2) trigger while leaving Article 13(1) headquarters construction applicable.
An industrial zone is not interchangeable with a designated industrial complex for corporate establishment.
The exclusions used for factory rules must not be transferred to the headquarters rule.
Enter a region that you have verified.
The location note is retained for review; typing an address does not automatically classify it.
Use the land-use confirmation, industrial-complex designation notice and boundary map to establish whether the actual parcel is inside the designated area.
The five-year boundary and events after a property purchase
The fifth anniversary and the following day
For incorporation on 2021-11-08, this planning calculation includes 2026-11-08 in the five-year window and shows 2026-11-09 as the release reference.
For an event on 2020-02-29, the reference period ends on 2025-02-28 and the following day is 2025-03-01.
Exclude the first day, count calendar years and include the last day through its end.
The five-year period for 2023-02-28 ends on 2028-02-29 because the final year is a leap year.
Relocation from outside a metropolitan area is not the only trigger.
Movement from a metropolitan location outside Seoul into Seoul can also qualify.
A branch is assessed by its registration requirements, human and physical facilities and continuing business activity, rather than corporate-register entry alone.
For a dormant company, verify the statutory categories and first controlling-shareholder event rather than using an arbitrary share purchase contract date.
Buying a property before creating the establishment does not automatically avoid surcharge if the property is intended for direct use by that head office or branch.
Article 16(4) and Decree Article 31 address conversion into a surcharge case within five years after acquisition.
Debt-preservation acquisitions, exceptions and overlapping establishment histories require individual review.
Expiry of one event does not remove a new branch or relocation trigger, or the independent headquarters provision.
Acquisition tax and the two accompanying taxes
Let S be the standard rate and B the surcharge reference rate of 2%.
Principal acquisition tax uses S for ordinary treatment, S+2B for Article 13(1), 3S−2B for Article 13(2), and 3S when both apply under Article 13(6).
For an original acquisition, the combined principal rate is therefore 2.8%×3=8.4%, rather than the 12% principal rate of a purchase.
Basic non-housing acquisition rates without individual exemptions or relief| Treatment | Purchase principal | Education tax | Rural tax | Purchase total | Original total |
|---|
| Ordinary | 4% | 0.4% | 0.2% | 4.6% | 3.16% |
| 13(1) Headquarters | 8% | 0.4% | 0.6% | 9.0% | 7.56% |
| 13(2) Metropolitan | 8% | 1.2% | 0.2% | 9.4% | 5.08% |
| 13(6) Combined | 12% | 1.2% | 0.6% | 13.8% | 9.48% |
Local education tax generally uses (S−2%)×20%, multiplied by three for metropolitan or combined treatment.
Rural development tax is not simply 10% of the actual principal tax.
Replace S with 2%, reapply the relevant surcharge formula, then multiply the resulting amount by 10%.
For original acquisitions, education tax is 0.16% under ordinary or headquarters treatment and 0.48% under metropolitan or combined treatment.
Each tax is rounded to whole KRW for planning; statutory filing truncation can differ.
Worked examples with a KRW 1 billion tax base
A purchased commercial property
With a KRW 1,000,000,000 tax base and only Article 13(2), principal tax is KRW 80,000,000, education tax KRW 12,000,000 and rural tax KRW 2,000,000: KRW 94,000,000 in total.
The difference from the ordinary KRW 46,000,000 is KRW 48,000,000.
Headquarters-only treatment totals KRW 90,000,000 and combined treatment KRW 138,000,000.
An original acquisition
At the same tax base with the 2.8% standard rate, totals are KRW 31,600,000 ordinary, KRW 50,800,000 metropolitan, KRW 75,600,000 headquarters and KRW 94,800,000 combined.
Do not combine purchased land and a new building or extension under one acquisition cause.
These fictional cases do not establish the tax base or relief for a real transaction.
In the purchase example, if there is no independent headquarters surcharge or new trigger and the law remains unchanged, acquisition after the release reference compares with ordinary treatment.
If both triggers applied, removing only the establishment surcharge leaves headquarters tax of KRW 90,000,000 and a difference of KRW 48,000,000.
It does not reduce the combined amount all the way to KRW 46,000,000.
Excluded industries: one-year, three-year and two-year monitoring
Decree Article 26 requires a listed industry, its individual qualifications and acquisition for qualifying direct use.
Adding a software or medical activity to a business registration does not automatically exclude every property.
Enter an exclusion only after verifying the relevant category and purpose with the authority.
Planned performance remains conditional.
An exclusion removes Article 13(2); it does not necessarily remove Article 13(1) headquarters construction.
Ordinary industry: one year
Recapture may follow failure to begin direct use within one year without a justifiable reason, or use or joint use for another activity or purpose during that period.
Housing construction: three years
Registered housing construction businesses acquiring for housing construction must verify the special three-year commencement and purpose restrictions.
The ordinary one-year rule must not be substituted.
Actual direct use: two years
Sale, use or joint use for another activity or purpose while the direct-use period is shorter than two years can trigger recapture.
Merely holding property for two years after acquisition is different.
Keep the use or commencement reference separate from monitoring actual direct use.
A construction commencement date alone is not the beginning of a two-year direct-use period.
Dates do not establish an authorized disposal date, a justifiable reason or holiday treatment.
Planned dates do not prove performance.
The individual-manufacturer conversion exception has specific five-year business, conversion and pre-conversion valuation conditions; it does not exclude every new purchase after conversion.
How to calculate and compare alternatives
- Enter the property type, acquisition date, verified tax base and acquisition cause.
Housing, factories and farmland require separate rules before a payable estimate can be used.
- Confirm the parcel-based region and industrial-complex status, then determine whether headquarters construction applies.
Do not replace unknown information with an outside-region or non-qualifying answer.
- Review the complete company and establishment history and enter the relevant incorporation, establishment, relocation or dormant acquisition event.
Check intended direct use before the event, special circumstances and any industry exclusion and its performance status.
- Read the principal and accompanying taxes, difference from ordinary treatment and five-year references.
Resolve missing facts in the review sheet before relying on any conditional scenario.
- Compare an outside-region acquisition, an industrial-complex acquisition or individual ownership using the same tax base, then save the review sheet.
Recalculate when price, purpose, purchaser, establishment history or governing law changes.
These alternatives compare acquisition-stage tax only.
They exclude extracting corporate funds, financing terms, holding taxes, rental income, capital gains and dividends.
Confirm that changing settlement actually changes the legal acquisition date.
Use the corporate property investment simulator for the broader ownership decision.
Frequently asked questions
Does a company older than five years always pay ordinary tax?
Check for later branch or relocation triggers and whether Article 13(2) has ceased to apply.
Headquarters construction under Article 13(1) is independent and can remain applicable.
Can relocation from outside Seoul into Seoul trigger surcharge?
Relocation from a metropolitan location outside Seoul into Seoul can qualify.
Check actual relocation and branch history in addition to incorporation, and enter the latest relevant event.
Does an industrial complex or industrial zone remove every surcharge?
The industrial-complex exclusion for Article 13(2) differs from Article 13(1) headquarters treatment.
An industrial zone is not the same designation.
Verify boundaries and actual purpose separately.
Can a rented shop qualify during the first five years?
Decree Article 27 includes both business and non-business acquisitions within five years after the event.
Ordinary rental activity does not automatically establish an excluded industry; the specific industry and permitted-leasing conditions must be checked.
Can I treat a planned excluded use as a completed exclusion?
A plan does not prove performance.
Verify direct-use purpose, use or construction deadlines, prohibited alternative use and minimum actual-use duration.
Planned performance remains conditional in this calculator.
Is combined principal tax 12% for original acquisition too?
No; 2.8% multiplied by three gives 8.4% principal tax.
Including the two accompanying taxes, the basic combined total is 9.48%, compared with 13.8% for a purchase.
How do conversions, mergers and dormant acquisitions work?
For a dormant company, confirm statutory status and the first controlling-shareholder date before entering that trigger.
Conversions, mergers, divisions and trusts need separate review of qualifications, valuation limits or asset ratios.
Is the saving guaranteed if settlement moves beyond five years?
It assumes the same tax base and purpose, no new trigger and unchanged 2026 law.
Confirm the legal acquisition date, later amendments and contract-change costs before renegotiating settlement.
Official sources and effective versions
Current-law search and article-specific queries were made directly to the National Law Information OPEN API on 2026-11-08.
The main versions are Local Tax Act MST282559 effective 2026-07-01 and its Enforcement Decree MST290815 effective 2026-10-01.
Supporting sources include the rural tax Act MST285905 effective 2026-05-12, metropolitan planning Decree MST277967 effective 2025-10-01, Local Tax Framework Act MST290139 and Civil Act MST284415 for period computation.
The current version at a source link can change after publication.
Recheck the version effective on the actual acquisition date, transitional provisions and individual interpretations.
This tool does not replace the authority decision or tax filing and does not assume missing requirements are satisfied.
Use the review sheet to confirm the transaction
Save the inputs and result with the corporate register, business registrations, building register and drawings, land-use confirmation, industrial-complex designation and direct-use evidence.
Ask the local tax authority to confirm the applicable article, tax base, individual taxes, exact period computation and monitoring obligations.
Use that confirmation when discussing settlement or ownership.
Recalculate if the price, purpose or establishment history changes.