South Korea, as an effective inheritance tax rate, has one of the highest gift and inheritance taxes in the world. IPG Legal works with expats and the families of Korean and foreign nationals on Korean inheritance, gift tax, estate planning, and other complex international estate and family law matters, and many of our clients welcome the proposed revision to Korea’s Inheritance Tax and Gift Tax Act and are hoping that Korea shall move to amend the law to allow more exemptions and exclusions. For other articles on Korean inheritance tax, please see IPG Legal’s Korean Estate & Korean Inheritance Law Archive.
Proposed Revision to Korea’s Inheritance Tax for Spouses of Decedents Explained by IPG Legal
Revision to Korea’s Inheritance Tax Law
The People Power Party proposed a revision to the Inheritance Tax and Gift Tax Act of Korea on March 17, 2025 to abolish the spousal inheritance tax. All 108 members of the party voted to abolish this tax.
Article 19 of Korea’s Inheritance Tax and Gift Tax Act has a spousal inheritance deduction of 500 million Korean won up to 3 billion won depending on the situation and a number of specific factors.
The main argument of the People Power Party is that married couples are, typically, of the same generation, thus, imposing inheritance tax when a spouse dies and then imposing inheritance tax again when the surviving spouse dies is double taxation of the same generation. It seems, likely, that the leader of the Democratic Party shall agree with the proposal. We shall update the reader when more is known.
Korea Inheritance Tax Deductions/Exemptions (2022)
| Deduction Classification | Amount of Deduction/Exemption (KRW) |
| Deceased Resident Deduction (Deceased Residents Only) | 500 million |
| Basic Deduction (Deceased Resident or Nonresident) | 200 million |
| Minor Child Deduction | 10 million times the number of years until the age of 19 |
| Senior Citizen (65+) Deduction | 50 million per senior |
| Disabled Person Deduction | 10 million times the expected life remaining |
| Child Deduction | 50 million per child |
| Spousal Deduction | 500 million or more: amount inherited Less than 500 Million: 500 million |
| Financial Property Deduction | 20 million or less: amount inherited 20 million to 100 million: 20 million 100 million to 1 Billion: NET x 20% More than 1 Billion: 200 million. (3 Billion Limit) |
Korean Inheritance Tax Rates (2022)
| Tax base (KRW) | Rate (%) | Deduction (KRW) |
| Less than KRW 100 million | 10% | |
| More than KRW 100 million to less than KRW 500 million | 20% | 10 million |
| More than KRW 500 million to less than KRW 1 billion | 30% | 60 million |
| More than KRW 1 billion to less than KRW 3 billion | 40% | 160 million |
| More than KRW 3 billion | 50% | 460 million |
Korean inheritance tax is calculated by multiplying the tax rate by the tax base. The calculation method has many exclusions based on the specific case situation and requires an accountant. Thus, here at IPG Legal, we always consult with an accountant we have in-house for all matters concerning the expected calculation of inheritance tax in Korea. Please note, that many cases are complicated by the choice of law and residency rules.
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