Korean family and inheritance issues often concern legal and tax matters across various jurisdictions. In many cases, the nationality of the decedent (the person who passes away, leaving an estate), the decedent’s residence, the location of the inherited property, and the nationality and residence of those inheriting the property will dictate the applicable law and taxes. In most cases, an experienced Korean estate lawyer and a Korean tax professional are necessary to assist in avoiding inheritance and family disputes, lessen tax burdens, and navigate the transfer and disposition of inherited assets.

Korean Inheritance matters have gone global, with over 7 million Koreans living abroad, with nearly 3 million residing in North America. Many individuals have assets worldwide, yet many lack an estate plan.

The following is a list of the central questions asked of IPG Legal by clients.

Korean Inheritance Law: Questions & Answers

Question & Answers on Korean Inheritance Law and Inheritance Tax Law

1. The Law of What Country/U.S. State governs Wills and Inheritance for Property Located in Korea

Non-Korean National: If the decedent is not a Korean national, in most cases, the law of the country (U.S. State) where the decedent is a national shall govern the inheritance law to be applied, even if the decedent’s assets are in Korea. However, exceptions exist with taxation. If the decedent’s permanent residence is in Korea, the worldwide assets of the decedent may be subject to taxation in Korea. For non-residents of Korea, the assets only in Korea shall be taxable by the Korean National Tax Service. Under Korean Law, an expat residing in Korea may designate the governing law for inheritance as the law of the Republic of Korea.

Korean National Residing in Korea: If the decedent is a Korean National residing in Korea, the governing law on inheritance is Korean Law even if the decedent specified another country in a will.

Korean National Residing Abroad: If a Korean National decedent is residing abroad and passes away without a will, Korea shall consider the governing law to be Korean Law. However, if the Korean National resides abroad and has a will, Korea shall, in most cases, consider the governing law as the law of the residence of the decedent.

We advise all Korean Nationals and Non-Korean nationals to have a will and devise an estate plan. We never know when we will pass, and early planning goes a long way in ensuring your family inherits your assets in the most cost-effective and efficient manner.

2. Can a Decedent Disinherit a Heir, such as a Wife or Child, of an Inheritance governed by Korean Law?

Answer: No.

Korea imposes a mandatory share of inheritance/legal reserve of inheritance (유류분/遺留分) on all decedents’ estates governed by Korean law. Thus, even if the will notes that a specific estranged child or spouse shall not receive any of the inheritance, Korean Law imposes a mandatory share of the estate for heirs if the decedent is a Korean National or chooses Korean Law to govern their will. Therefore, the deceased is forced by Korean Law to provide a certain percentage of the estate to all legal heirs under Korea’s Inheritance Reserve Law. A new law was passed regarding “disinherited” heirs who have abandoned their parents; we will discuss this matter in the near future. Please check back to: IPG Legal’s Inheritance & Estate Law Archive.

3. How is the Korean Legal Reserve Calculated?

The calculation of Korea’s legal reserve for inheritance is primarily governed by the Korean Civil Act.

Article 1112 of the Korean Civil Code (Persons with Right to Legal Reserve of Inheritance and Legal Reserve of Inheritance)
Legal reserve of inheritance for an inheritor shall be calculated according to the following subparagraphs:
1. For lineal descendants (직계비속) of an inheritee, one half of the inheritance stipulated by law;
2. For the spouse (배우자) of an inheritee, one half of the inheritance stipulated by law;
3. For lineal ascendants (직계존속) of an inheritee, one third of the inheritance stipulated by law;
4. For brothers and sisters (형제자매) of an inheritee, one third of the inheritance stipulated by law.

Korean Civil Act, Article 1112

Thus, a legal reserve is not available for all heirs. The law only protects lineal descendants, the spouse, lineal ascendants, and brothers and sisters of the decedent.

4. If a Decedent’s Estate is Governed by Korean Law and the Decedent Passes without a Will, Which Family Members Inherit the Estate?

Korea’s Intestate Succession Law dictates who shall receive what when one dies without a will. The majority of jurisdictions have an Intestate Succession Law. Intestate means, in short, dying without a will.

The following are the priorities under the Korean Intestate Succession Law.

• First Priority: Direct descendants (children and grandchildren);
• Second Priority: Direct ascendants (parents and grandparents);
• Third Priority: Siblings (brothers and sisters); and
• Fourth Priority: Relatives within the 4th Degree (Uncles, Aunts, Nephews, Nieces).

If a spouse survives the decedent and descendants survive within the First or Second Priority, the spouse shall co-inherit the estate; however, the spouse shall receive a 50% greater share of the estate than the other inheritors. If no descendants survive the decedent within the First and Second Priority, the surviving spouse shall receive the entire estate under Korea’s Intestate Succession Law.

If multiple descendants within the same degree of relationship survive the decedent, the descendants shall inherit the estate in equal shares. Any descendants within the same priority shall inherit equally unless one descendant is within a closer degree of relationship than the other descendants.

The Caveat: The Legal Reserve Share
Even if a will exists, descendants must receive, under Korean Law, 50% of the share of the estate that the descendant would have received if the decedent had passed without a will. Please also refer to the Legal Reserve Section Above.

5. Does Korea Recognize Holographic Wills?

Yes. Korean Courts enforce holographic wills. Korea recognizes five different types of valid wills. We will have a more detailed post in the near future on the formalities for executing a Notarized Will. We have encountered issues that have caused delays in asset transfers due to the carelessness of notarial offices and even lawyers. Strict formalities must be met or the will shall be deemed invalid.

The following wills are recognized as valid and enforceable in Korea.

1. Notarial Will
2. Holographic Will
3. Secret/Sealed Documents Will
4. Recorded Will
5. Dictated Will

6. Can you Inherit the Debt of your Deceased Parent?

Yes. Often, not renouncing an estate that has more liabilities than assets can lead to the assumption of the estate’s debt— a debt that is enforceable outside of Korea. Yes, a debt in Korea can be enforced in the United States, Europe, and most other parts of the world. Courts, nearly universally, recognize the judgments of Korean courts.

7. Can an Inheritor Refuse the Inheritance of a Korean Estate?

Yes. You may choose to renounce an estate. To renounce an inheritance in Korea, in most cases, the heir is required to make a “declaration of renunciation to the family court” (Korean Civil Act, Art. 1041) in Korea within three (3) months of notification of the inheritance to the heir. Therefore, it is crucial to act promptly.

Often, not renouncing an estate can lead to the assumption of the debt of the estate – a debt that is enforceable outside of Korea. Debt, in Korea, can be enforced in the United States, Canada, Europe, and almost anywhere in the world. Courts, nearly universally, recognize the judgments of Korean courts.

After termination of this period (3 months), an estate, in Korea, is presumed accepted without condition. Exceptions exist, and IPG Legal has successfully applied for these exceptions for many estates.

8. Does Korea Impose an Inheritance Tax on Estates in Korea and Abroad?

It Depends. Korea taxes “Residents” differently from non-residents. Korea considers a resident, for inheritance tax purposes, as anyone who resided in Korea for more than 183 days from the commencement of the inheritance or has a residential address in Korea. Please note this is an oversimplification, and the Korean law on tax residence has a long and complex body of case law that considers objective facts in determining residence for tax purposes.

Residents of Korea: All inherited property of the decedent in Korea and abroad is subject to taxation in Korea.

Non-Resident of Korea: All inherited property of the decedent in Korea (only Korea) is subject to tax.

The following is only meant as a brief guide. This is a complicated area of law that changes often and requires the use of an accountant.

Korea Inheritance Tax Deductions/Exemptions (2022)

Korean Inheritance Tax Rates (2022)

Korean Inheritance Tax is calculated by multiplying the tax rate by the tax base. This is only a quick teaser. The calculation method has many exclusions based on the specific case situation and requires an accountant. Thus, we always consult with the accountant we have in-house for all matters concerning the expected calculation of inheritance. Please note that many cases are complicated by the choice of law and residency rules.

Please check out our other articles on Korean Inheritance Law listed below, and please feel free to contact us with any questions.

🔗 Visit www.ipglegal.com for a free confidential initial consultation with an attorney at IPG Legal.

by Sean Hayes

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 a few non-Korean lawyers as a Top Attorney by AsiaLaw. Sean is regularly quoted by leading international media outlets, including The Wall Street Journal, The New York Times, France 24, and Bloomberg. Sean works with leading retired judges, former government attorneys, corporate counsel, and top-rated lawyers who worked with major global law firms throughout Asia, Europe, and North America.

You may schedule a call with Sean Hayes at: Schedule a Call with an Attorney.