Korean Flat-Tax Rate for Foreign Workers in Korea

The Special Tax Treatment Control Law of Korea extended the benefit of the Flat Tax from five years to 20 years. The flat tax rate with the local income tax is 20.9% of the foreign employee’s earned income.

Additionally, the National Tax Services of Korea and the Ministry of Economy & Finance of Korea agreed to deem the employment start date as January 1, 2014, even if the foreign national worked in Korea prior to 2014. Thus, foreigners shall be able to claim the flat tax until December 31, 2033, even if they were employed in Korea prior to 2014. This is great news for long-term residents of Korea.

Additionally, if the foreign national leaves Korea and subsequently re-employs in Korea, the limitation period shall commence on the day of reemployment in Korea, not on the date of first employment in Korea.

This amendment to the Special Tax Treatment Control Law of Korea is welcomed by investors in Korea and shall do its part in encouraging more investment in Korea. We have great hope that the present administration shall be much more friendly to investors in Korea. This development and the further development of free trade zones are a great step in the right direction.

For a consultation with an attorney or our in-house CPA, schedule a call with IPG Legal. Please note that we have an affiliated tax accountant and CPA who files taxes for foreign businesses, foreign employees, and entrepreneurs. Please note your specific need when scheduling a call, and we shall get the right person on the line for your call with us.

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Sean Hayes is the first non-Korean attorney to have worked for the Korean court system (Constitutional Court of Korea) and one of the first non-Koreans to be a regular member of a Korean law faculty. Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw, and IPG Legal is consistently ranked Top Dispute Resolution Law for our litigation services.

To schedule a call with Sean Hayes, please Schedule a Call Here.