Korea-specific calculator. This guide estimates a research and personnel development tax credit under South Korea’s 2026 tax rules.
It does not decide whether a project, laboratory, employee, or expense is legally eligible, and it does not replace the official Korean filing forms or professional review.
What is Korea’s R&D tax credit?
The research and personnel development credit under the Restriction of Special Taxation Act (RSTA) Article 10 directly reduces Korean corporate income tax or individual income tax attributable to business income.
It is different from simply deducting a research expense when taxable income is calculated because the statutory credit is subtracted from tax after the eligible base and rate are determined.
The 2026 rules divide eligible spending into general research and personnel development expense, new-growth and source technology R&D expense, and national strategic technology R&D expense.
General expense uses either a current-year method or an incremental method, while the two special-technology categories use a company-size base rate plus an additional rate tied to the R&D-to-revenue ratio.
What this calculator estimates
- The general R&D current-year credit and incremental credit side by side
- Whether the previous-four-year history permits the incremental method
- Base, additional, and total rates for new-growth and national strategic technology
- The transitional current-year rates after an entity leaves SME status
- Total generated credit and the effective rate across all entered eligible expenses
Start with net eligible expense
RSTA Enforcement Decree Article 9 refers to Annex 6 for the expense categories that can enter the credit base.
Typical items include compensation and employer-paid social insurance for qualifying personnel who directly conduct or support research at an eligible laboratory or dedicated department, research samples and materials, qualifying prototype processing, research-facility rent or usage fees, research cloud-computing services, and purchases of artificial-intelligence training data.
Certain commissioned or joint research, employee-invention compensation, technical information, and personnel-development expense may also qualify when the detailed institutional and documentation tests are met.
Common inclusions to review
- Eligible research personnel compensation and employer social-insurance contributions
- Research-only materials, samples, prototype processing, software, cloud, and data
- Commissioned or joint research performed by an eligible institution
- Personnel-development expense that falls within the Annex 6 categories
Common exclusions to review
- Expense funded by specified national, local-government, public-agency, or public-enterprise grants
- Retirement income, retirement-benefit reserves, and specified retirement-plan contributions
- Compensation for staff who perform administrative work without directly conducting or supporting research
- Commissioned development of operating, management, or support systems such as ERP or point-of-sale systems
Enter the company-funded net eligible amount after grant-funded expense is removed.
Do not enter the same cost in general, new-growth, and national strategic technology boxes because Article 10 requires separate accounting and does not permit double counting.
General R&D: current-year versus incremental method
The current-year method applies a company-size rate to all eligible general research and personnel development expense for the tax year.
The incremental method applies a higher 25%, 40%, or 50% rate only to the amount by which current-year general expense exceeds the immediately preceding year.
When both are available, the taxpayer selects one method, so the calculator tests eligibility and then recommends the larger result.
General research and personnel development credit rates by Korean company classification for 2026| Company classification | Current-year rate | Incremental rate | Planning point |
|---|
| SME | 25% | 50% | A large increase can make the incremental method better |
| Years 1–3 after the SME grace period ends | 20% | 40% or 25% | Incremental rate depends on current mid-size status |
| Years 4–5 after the SME grace period ends | 15% | 40% or 25% | Transitional rate for qualifying post-2024 exits |
| Mid-size company | 8% | 40% | Decree conditions include a prior-three-year average revenue test |
| Other or large company | Up to 2% | 25% | Current rate is half the R&D-to-revenue ratio, capped at 2% |
Three gates for the incremental method
- Some general research and personnel development expense must have arisen during the preceding four years
- The immediately preceding year must not be below the average of those four preceding years
- The current-year general expense must exceed the immediately preceding year
If any gate fails, Article 10 requires the current-year method.
Mergers, divisions, business transfers, in-kind contributions, and short tax years need the succession and month-adjustment rules in Enforcement Decree Article 9 rather than the calculator’s standard four full-year assumption.
New-growth and national strategic technology rates
The two special-technology categories use higher rates but require the project to match the detailed technologies in Enforcement Decree Annex 7 or Annex 7-2 and to satisfy the dedicated-department and documentation conditions.
For each category, the additional rate equals the category’s current-year eligible expense divided by revenue, multiplied by three, and capped at 10%.
That additional rate is added to the company-size base rate.
New-growth and national strategic technology research credit base and maximum rates for 2026| Company classification | New-growth base | Strategic base | Additional cap | Maximum totals |
|---|
| SME | 30% | 40% | 10% | 40% / 50% |
| Years 1–3 after first leaving SME status | 25% | 35% | 10% | 35% / 45% |
| Other company | 20% | 30% | 10% | 30% / 40% |
Technology eligibility comes before the rate
A company does not receive a special rate merely because it operates in a high-technology industry.
The actual research target must match the annexed technology, and personnel time and expense must be separately accounted for from general R&D and the other special category.
When the same expense could fall into both special categories, Article 10 permits a choice rather than two credits on the same amount.
Generated credit is not always the amount usable now
Tax liability, minimum tax, and carryforward still matter
This calculator stops at the Article 10 generated credit.
A filing must determine available tax before credits, the ordering of other reductions and credits, and the minimum-tax restriction in RSTA Article 132.
For corporate taxpayers, the Article 10 minimum-tax listing applies to taxpayers other than SMEs, while business-income taxpayers must also review the individual-income-tax minimum under Article 132(2).
Under RSTA Article 144, an otherwise eligible amount not used because no tax is payable or because of the minimum tax can generally be carried to tax years ending within 10 years from the beginning of the next tax year.
- File the tax-credit application and research and personnel development expense schedules with the tax return
- Prepare and retain the research plan, research report, research notes, and supporting evidence
- Reconcile personnel qualifications, work time, payroll, materials, outsourced work, and tax invoices by project
- Allocate common expense among general, new-growth, and strategic categories under the prescribed rules
- Use the National Tax Service advance review or a qualified adviser when expense or technology eligibility is uncertain
Check the special-technology sunset dates
Under the 2026 text of Article 10, the new-growth and national strategic technology credits generally apply to eligible expense incurred through December 31, 2029.
The semiconductor field within national strategic technology has a separate date of December 31, 2031.
General research and personnel development expense is not within that Article 10 item 1 and item 2 sunset sentence, but all rates and classifications should still be rechecked for the filing year.
Official basis and update record
Verified on July 20, 2026
- Restriction of Special Taxation Act Article 10, current statute record MST 280409
- Restriction of Special Taxation Act Enforcement Decree Article 9, current decree record MST 287181
- Enforcement Decree Annex 6, eligible credit expense, amended February 27, 2026
- Enforcement Rule Schedule Form 3(1) through 3(3), amended March 20, 2026
- RSTA Article 132 minimum tax and Article 144 ten-year carryforward
The calculator uses the statute and decree version in force on July 1, 2026; Article 10 itself shows an effective date of January 1, 2026.
Before filing, check the National Law Information Center and National Tax Service materials for later amendments to rates, eligible technologies, expense categories, forms, and sunset dates.
Organize the expense before estimating the credit
Prepare current and prior-four-year general R&D, current revenue, and net separately accounted new-growth and strategic expense.
Use the estimate to identify documentation gaps, then confirm eligibility and the usable tax amount through the official schedules, advance review, or a Korean tax professional.