Personal taxes

摘要

South Korea's personal income tax rates are progressive; rates and brackets vary depending on the source of income. The country has been expanding tax coverage for residents' income derived from abroad and from foreign-exchange-related transactions (such as derivatives deals) as the foreign-exchange regime and capital markets have become liberalised. The personal tax burden is now trending lower for middle- and lower-income taxpayers, and a more attractive tax package is available to expatriate executives and skilled foreign workers. The tax law defines a resident as anyone with a domicile in South Korea, or who has resided there for more than 183 days in the current year. A previous test, which included anyone resident for more than 183 days over two consecutive tax years, was removed to promote investment in Korea by Korean nationals residing abroad, enabling them to visit more often without becoming residents for tax purposes. Foreigners must declare residency if they will be in the country for at least 90 days. The line between resident and nonresident status is sometimes blurred, and documentary support-such as an employment contract stating the duration of assignment as one year or longer-may be required to establish resident status. Residents are subject to tax on "global income" from all domestic and foreign sources. Nonresidents are taxed on all income arising from domestic sources, subject to certain tax holidays for expatriate employees.