Certain tax credits against global income tax liability are available for resident taxpayers. These include the items shown below.
Credit for Class A and Class B wages
A maximum credit of KRW 740,000 per year is available for Class A and Class B wages:
Where the calculated tax amount is KRW 1,300,000 or less, the credit allowance is the calculated tax amount multiplied by 55%.
Where the calculated tax amount is more than KRW 1,300,000, the credit is KRW 715,000 plus 30% of the calculated tax amount in excess of KRW 1,300,000, subject to the maximum of KRW 740,000 per year.
Credit for Class B wages through a licensed taxpayers’ association
A tax credit of 5% of the income tax is available for Class B wage earners who voluntarily report their monthly earnings and pay monthly income taxes through a licensed taxpayers’ association.
Credit for dividend income
A tax credit of 11% of certain dividends received by each shareholder is available against the individual income tax calculated on global income, which is grossed-up by adding 11% of dividends received.
Credit for casualty losses
Where a business income earner has lost assets equivalent to 20% or more of the total value of the business assets due to disasters occurring during the year in question, an amount calculated according to the ratio of the loss shall be deducted for the income tax.