Doing taxes in any country is not the most fun experience you can have and I downright dreaded it in the U.S. I will admit that it’s not too hard back home…but in Korea, it’s a different story. First, general information about Korean tax and the Korean tax system.
The Korean tax system is quite different than back home. Taxes are calculated based on several different factors for foreigners. The most important factor is your employment status. In simplest terms, you ask yourself if you are directly an employee of your company or school or are you a contracted employee. Does your school directly pay your wages or are you contracted out? This will determine when you file. Most foreigners here (hagwons, not public schools) are considered contracted/private workers so you will file in May. If you are an employee of your school (like most public school teachers) then you file in February. Many schools in Korea will help you file but if you are lucky enough to be working at an after school company (or two) like myself during the year, you are on your own and most likely have to file in May.
Korean taxes are calculated based on the tax year January 1st of the previous year until December 31st. The amount of taxes you pay also differs. There is a 3.3% tax rate for most foreigners.
After speaking with the tax office, I was told the forms you will need are:
- 소득 원천 징수 영수증 (tax receipt provided by your job/jobs),
- 연말정산 which you get from your bank(s), and
- and the form provided by your local tax office when you go in to fill it out (the helpline wouldn’t tell me exactly which one. Also you can find your local tax office on the website below*).
My husband happen to have the day off and was nice enough to go with me, there is actually more you need for a more thorough and complete tax return:
- If you are married, bring a copy of your marriage certificate (혼인관계중면서),
Once you have these forms, head to your local tax office where you can file your taxes and be done for the year.
Keep in mind that although you are working in a foreign country, you are still responsible for taxes in your home country as well. You must file taxes with your government and state. There are ways to register as an expat in your home state if you are America and your state taxes worldwide income. Ask your tax person about that. Here in South Korea, there are H&R Blocks that can help you as well as things like TurboTax. Don’t let these things lax or they can come back to bite you when you do find your way back home.
When you file back home you will need the exact same documents you used for your Korean taxes except either you or someone else needs to translate them.
*If you aren’t sure about anything you can refer to the National Tax Service website or the phone helpline for foreigners: