Foreigner Salary Calculator Special Tax Treatment §18-2 · Apr 2026
Monthly take-home for foreign workers in Korea. Compares the progressive scheme vs the 19% flat tax.
How the comparison works
- Progressive (default): standard Korean income tax 6-45% with earned-income deduction + personal deduction (₩1.5M × dependents) + earned-income tax credit. + 10% local tax.
- Flat 19% (Article 18-2): 19% × annual taxable income, no deductions. + 1.9% local = 20.9% effective. Available for first 20 years from your initial Korean employment date.
- 4대보험 (2026 employee rates): NPS 4.75% (capped at ₩6.59M monthly from Jul 2026), NHIS 3.595% + LTC 13.14% of NHIS, EI 0.9%. Same as Koreans.
- NPS opt-out: available if your home country has a bilateral social security agreement with Korea (US, CA, JP, AU, DE, UK, FR, etc., ~30 countries). Need a Certificate of Coverage from home pension authority.
⚠ Simplified calculator. Doesn't include child tax credits, medical/insurance/pension deductions, special foreign-worker housing allowances, or contractual signing bonuses. For exact figures, consult your employer's payroll team or NTS hometax (hometax.go.kr).
📌 Official Sources · References
- National Tax Service (NTS) — Withholding Tax Tables + Special Tax Treatment Act §18-2 · Official basis for foreign-worker payroll withholding and 19% flat-rate election
- 4대사회보험 정보연계센터 (4-Insurance Integrated Center) · Official rates: NPS 4.5% / NHIS 3.545% + LTC 12.95% / Employment 0.9% for employees (☎ 1666-0100)
- National Pension Service (NPS) — Foreigner Pension · NPS opt-out via bilateral pension agreements (US, Canada, Japan, Australia, EU) — requires Certificate of Coverage before employment
- National Health Insurance Service (NHIS) — Foreigner Coverage · Foreign worker NHIS enrollment + dependent registration rules
- NTS Hometax — Year-End Settlement · Official channel for year-end settlement and tax treaty benefit elections
This tool estimates monthly take-home for foreign workers using 2026 4대보험 rates + tax brackets. Actual amounts vary by individual circumstances — bilateral pension agreements, foreign-specific deductions, employer payroll configuration, NHIS dependents, and individual benefit setups. NPS opt-out requires proper Certificate of Coverage submitted before employment. Verify with HR or a licensed tax accountant.
FAQ
Which tax option do most foreigners pick?
It depends on income. Below ~₩130M annual taxable income, the progressive scheme (6-45% with deductions) is usually cheaper. Above ~₩150M, the flat 19% (+1.9% local = 20.9%) wins because deductions don't outweigh the lower top rate. Around ₩130-150M is the crossover zone — run both options in this calculator with your specific income, dependents, and deductions to see your exact break-even.
Can I opt out of national pension?
Yes, if your home country has a bilateral social security agreement with Korea — US, Canada, Japan, Australia, Germany, France, UK, and ~30 others. Submit a Certificate of Coverage from your home country's pension authority (US: SSA, Canada: Service Canada) to your Korean employer. The exemption typically lasts 5 years and may be extended once. Without an agreement, you pay full NPS but can claim a lump-sum refund (반환일시금) when you leave Korea permanently — for nationalities with reciprocal refund rules.
Are 4대보험 contributions different for foreigners?
Mostly the same as Koreans (2026 employee rates): NPS 4.75%, NHIS 3.595%, LTC 13.14% of NHIS, EI 0.9%. Workmen's comp is 100% employer-paid. Two foreign-specific points: (1) NPS treaty opt-out described above, (2) E-9 (non-professional employment) workers get a special NPS lump-sum refund on departure regardless of their country, since 2007. F-2/F-5/F-6 long-term residents are treated identically to Koreans for all four insurances.
Is meal allowance still tax-free for foreigners?
Yes. The ₩200,000/month tax-free meal benefit (Income Tax Act Enforcement Decree §17, raised in 2023) applies to all employees regardless of nationality. The benefit also reduces your 4대보험 base, so it's effectively a double tax break. Verify your employer codes meal allowance as a separate non-taxable line on payslips — if bundled into base salary, it's not eligible.
How does this compare to my Korean colleagues?
If you stay on the progressive scheme and pay full 4대보험, your take-home matches a Korean's. If you elect 19% flat or opt out of NPS via treaty, your take-home is higher than a comparable Korean — but you're trading lower future Korean pension benefits or weaker long-term tax efficiency. F-2/F-5 permanent residents typically pick progressive + full NPS for the long view; short-term E-7 specialists often pick flat + treaty opt-out for cash flow.