By far the largest tax when selling a home in Korea is capital gains tax. Yet ask "how much will it be?" and nobody can answer straight away — because holding period, number of homes, location and residence can swing the bill several times over.
This guide walks through the calculation in order. Use the tables to plug in your own case.
⚠️ The big 2026 change — the four-year suspension of the multi-home surcharge ended on May 9, 2026, and the surcharge returned on May 10. In regulated areas, two-home owners face +20%p and three-or-more +30%p, and the long-term holding deduction is disallowed.
Step 1 — The calculation flow
| ① Capital gain | Sale price − purchase price − allowable expenses |
| ② Taxable gain | ① − long-term holding deduction |
| ③ Tax base | ② − basic deduction of ₩2.5M (once a year) |
| ④ Computed tax | ③ × rate − progressive deduction |
| ⑤ Total payable | ④ + local income tax (10% of ④) |
People routinely forget the last line. Local income tax of 10% always follows. A ₩100M computed tax means ₩110M out the door.
Step 2 — The rate table
Hold for two years or more and the progressive rates apply.
| Tax base | Rate · progressive deduction |
| Up to ₩14M | 6% · 0 |
| ₩14M – ₩50M | 15% · ₩1.26M |
| ₩50M – ₩88M | 24% · ₩5.76M |
| ₩88M – ₩150M | 35% · ₩15.44M |
| ₩150M – ₩300M | 38% · ₩19.94M |
| ₩300M – ₩500M | 40% · ₩25.94M |
| ₩500M – ₩1B | 42% · ₩35.94M |
| Over ₩1B | 45% · ₩65.94M |
Short holding is taxed completely differently
| Holding period | Housing / pre-sale rights |
| Under 1 year | 70% / 70% |
| 1 to 2 years | 60% / 60% |
| 2 years or more | Progressive (6–45%) / 60% |
| Unregistered transfer | 70% |
Clearing two years is the first fork. Sell at 23 months and it's 60%; at 25 months the top progressive rate is 45%. Two months flips the outcome.
Step 3 — The multi-home surcharge (back since May 10, 2026)
| Two homes (selling in a regulated area) | Base rate + 20%p |
| Three or more (regulated area) | Base rate + 30%p |
| Long-term holding deduction | Disallowed for surcharged homes |
| Non-regulated areas | No surcharge (base rates) |
At the top bracket with three homes: 45% + 30%p = 75%, and with local income tax the effective rate reaches 82.5% — most of the gain goes to tax.
Transitional relief — contracts signed by May 9, 2026 with documented deposit payment are exempt from the surcharge. Keep the contract and transfer records if this applies to you.
Step 4 — Long-term holding deduction
| General property (3+ years) | 2% per year, up to 30% (15 years) |
| Single home — holding | 4% per year, up to 40% |
| Single home — residence | 4% per year, up to 40% |
| Single home total | Up to 80% (holding + residence) |
A single-home household counts holding and residence separately and adds them. Ten years of each gives 80% — so a ₩1B gain is taxed on only ₩200M. Conversely, surcharged sales lose this deduction entirely, which often hurts more than the higher rate.
Step 5 — Allowable expenses: receipts are money
| Allowed ✅ | Not allowed ❌ |
| Acquisition and registration tax | Wallpaper and flooring |
| Agent commissions (buy and sell) | Sink and lighting replacement |
| Legal scrivener fees | Boiler repair (routine) |
| Balcony extension | Paint |
| Window (saesi) installation | Appliances |
| Heating system upgrade | Cleaning and moving costs |
| Tax filing fees | Loan interest |
One test decides it: spending that raises value or extends life (capital expenditure) counts; spending that maintains condition (repairs) doesn't. And without documentation — invoices, card records, transfers — nothing counts, however real the spending was.
Worked example
Bought at ₩500M, sold at ₩900M, held and lived in for 8 years, single-home household, ₩30M of expenses:
| Sale price | ₩900,000,000 |
| − Purchase price | ₩500,000,000 |
| − Expenses | ₩30,000,000 |
| = Capital gain | ₩370,000,000 |
| Exemption test | Under ₩1.2B → fully exempt |
| Tax due | ₩0 |
Meet the single-home requirements under ₩1.2B and even this gain is tax-free (see the exemption requirements). Sell the same home as a two-home owner in a regulated area and the deduction disappears while the surcharge applies — comfortably over ₩100M in tax. Same home, same gain, different household.
Filing and payment
| Preliminary return | Within 2 months from month-end of sale |
| Final return | Following May, if multiple sales in a year |
| Reference date | Balance payment date (or registration, whichever is earlier) |
| Installments | Available above ₩10M |
| Non-filing penalty | 20% plus late-payment penalties |
Tax-saving checklist
- Always clear two years — avoiding 60–70% rates comes first
- Check single-home status — household-wide home count, plus residence if bought in a regulated area
- Collect receipts — acquisition tax, commissions, extensions, windows
- Split sales across tax years to use the ₩2.5M deduction twice and lower brackets
- Order matters for multi-home owners — which home you sell first changes everything
- Consult before selling — one day's difference in closing can flip the result
FAQ
What if I don't know the purchase price?
A converted acquisition value can be used, though it may be less favorable. Hunt for the original contract first.
What's the basis for an inherited home?
The valuation at the date of inheritance. Keep the inheritance tax documents.
Does joint ownership reduce tax?
Usually yes — the gain is split by share, each spouse gets their own progressive brackets and their own ₩2.5M deduction.
I sold at a loss — do I file?
No tax is due, but filing lets you offset gains from other sales in the same year.
Capital gains tax is decided less by your sale price than by the conditions of the sale. Run these tables before you sign.
This is general 2026 information, not tax advice. Korean property tax rules change frequently and outcomes vary sharply by home count, area and purchase date — consult a tax professional before selling.
