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Income Tax (Individual)

Local Compliance InformationIncome Tax (Individual)

Subject

Retirement Income Tax Calculation (revised Jan. 1, 2016)

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Manager

Date

2016-02-29

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TaxonRetirementIncome_퇴직소득세과세방식_Eng_Kor_2016 02 29_F2[1].pdf

Retirement Income Tax Calculation

(revision Jan. 1, 2016)

              Feb, 29, 2016

■    Retirement Income Tax Calculation

Before Revision (A)

After Revision (B)

①     Retirement Income – Basic deduction – Deduction for Service Year

②    ① x 5* ÷ Service year

③    ② x Standard rate***

④    ③ x Service year ÷ 5*

①     Retirement Income – Deduction for Service Year**

(Basic deduction: abolished)

②     Converted salary = ① x 12* ÷ Service year

③    (② – Converted salary deduction) x Standard rate***

Converted salary

Deductions

KRW 8 million or less

100% of Converted salary

KRW 8~70 million or less

KRW 8.0 million + (60% of the amount over KRW 8 million)

KRW 70~100 million or less

KRW 45.2 million + (55% of the amount over KRW 70 million)

KRW100~300 million or less

KRW 61.7 million + (45% of the amount over KRW 100 million)

Over KRW 300 million

KRW 151.7 million + (35% of the amount over KRW 300 million)

④    ③ x 12* ÷ Service year(s)

* The annual tax multiplied years method applied

** Deduction for Service Year:

Service Year

Deductions

5 years or less

KRW 0.3 million x service year(s)

over 5 years~10 years or less

KRW 1,500,000

+ (KRW 0.5 million x (service yrs – 5 yrs))

over 10 years~20 years or less

KRW 4,000,000

+ (KRW 0.8 million x (service yrs – 10 yrs))

over 20 years

KRW 12,000,000

+ (KRW 1.2 million x (service yrs – 20 yrs))

*** Standard Rate:

Income Amount

Tax Rate

KRW 12 million or less

6%

over KRW 12~46 million or less

KRW 720,000

+ 15% of the amount over KRW 12 mill

over KRW 46~88 million or less

KRW 5,820,000

+ 24% of the amount over KRW 46 mill

over KRW 88~150 million or less

KRW 15,900,000

+ 35% of the amount over KRW 88 mill

over KRW150 million won

KRW 37,600,000

+ 38% of the amount over KRW 150 mil

**** Special calculation method for the overlapping period:

If retirement date falls on Jan. 1, 2016 ~ Dec. 31, 2019 period, the calculation formula is as follows.

(Tax amount calculated by the process of “Before Revision (A)” x Rate applied) + (Tax amount calculated by the process of “After Revision (B) x Rate applied)
:
:
Please refer the enclosed for more information.

This material is for your reference ONLY, and is NOT subject to release to the others at the cost of charge.
All copyrights on this material are reserved by Selim Tax-Account Firm.

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Service Year	Deductions
5 years or less	KRW 0.3 million x service year(s)
over 5 years~10 years or less	KRW 1,500,000	+ (KRW 0.5 million x (service yrs – 5 yrs))
over 10 years~20 years or less	KRW 4,000,000	+ (KRW 0.8 million x (service yrs – 10 yrs))
over 20 years	KRW 12,000,000	+ (KRW 1.2 million x (service yrs – 20 yrs))

Income Amount	Tax Rate
KRW 12 million or less	6%
over KRW 12~46 million or less	KRW 720,000	+ 15% of the amount over KRW 12 mill
over KRW 46~88 million or less	KRW 5,820,000	+ 24% of the amount over KRW 46 mill
over KRW 88~150 million or less	KRW 15,900,000	+ 35% of the amount over KRW 88 mill
over KRW150 million won	KRW 37,600,000	+ 38% of the amount over KRW 150 mil