To claim a parent, child or spouse as a basic deduction (1.5 million won each) at Korean year-end tax settlement, they must pass an income test as well as the age rules. Income Tax Act Article 50(1) requires that their income amount for the year totals 1 million won or less — including someone who has only earned income with gross pay of 5 million won or less. The test uses the income amount, not receipts: pay after the earned income deduction, pensions after the pension income deduction. The calculator checks a student with a part-time job, a parent on a pension, or a relative who retired or sold property this year.
1. The line is an income amount of 1 million won — or gross pay up to 5 million won with earned income only.
2. Pensions count after the pension income deduction — with a taxable public pension only, 5.16 million won gives 996,000 won, and 5.2 million gives 1.02 million.
3. Separately taxed income is left out — private pensions up to 15 million won and other income up to 3 million where chosen, interest and dividends up to 20 million (Art. 14(3), our reading).
Calculator
Updates as you type. We leave out income that Art. 14(3) keeps out of global income (our reading): private pensions of 15 million won or less and withheld other income of 3 million or less if taxed separately, withheld interest and dividends of 20 million or less. Dividend gross-up is not reflected.
Who counts — Article 50(1)
| Type | What the source says | Worth noting (ours) |
|---|---|---|
| (i) Yourself | The resident | No income test |
| (ii) Spouse | No income amount, or a total of 1 million won or less (including a spouse with only earned income of 5 million won or less) | No age test |
| (iii)(a) Lineal ascendants | 60 or over | Parents, grandparents |
| (iii)(b) Lineal descendants | 20 or under | Children |
| (iii)(c) Siblings | 20 or under, or 60 or over | — |
| (iii) common | Living with you and with a total income amount of 1 million won or less (or only earned income up to 5 million won); disabled people are exempt from the age limits | The income test still applies (our reading) |
How income amounts are worked out
| Type | What the source says | Worth noting (ours) |
|---|---|---|
| Earned income amount (Art. 20(2)) | Gross pay (non-taxable excluded) minus the earned income deduction (Art. 47) | Table 1 |
| Pension income amount (Art. 20-3(3)) | Total pension minus the pension income deduction (Art. 47-2, cap 9 million won) | Table 2 |
| Business and other income (Arts. 19(2), 21(3)) | Revenue minus necessary expenses | Enter the net figure |
| Retirement income amount (Art. 22(3)) | The total of retirement income (non-taxable excluded) | Easily over 1 million (our gloss) |
| Kinds of income (Art. 4(1)) | Global, retirement and capital gains income | The calculator adds all three (our reading) |
Table 1. Earned income deduction (Art. 47(1), cap 20 million won)
| Gross pay | Deduction | Worth noting (ours) |
|---|---|---|
| Up to 5 million won | 70/100 of pay | 5 million gives 3.5 million → 1.5 million income |
| Over 5 million to 15 million | 3.5 million + 40/100 of the excess over 5 million | 5.2 million gives 3.58 million |
| Over 15 million to 45 million | 7.5 million + 15/100 of the excess | — |
| Over 45 million to 100 million | 12 million + 5/100 of the excess | — |
| Over 100 million | 14.75 million + 2/100 of the excess | — |
Table 2. Pension income deduction (Art. 47-2(1), cap 9 million won)
| Total pension | Deduction | Worth noting (ours) |
|---|---|---|
| Up to 3.5 million won | All of it | Income amount 0 |
| Over 3.5 million to 7 million | 3.5 million + 40/100 of the excess | 5.16 million gives 4,164,000 won |
| Over 7 million to 14 million | 4.9 million + 20/100 of the excess | — |
| Over 14 million | 6.3 million + 10/100 of the excess | — |
Pay of 5 million gives an earned income amount of 1.5 million, over the line, but the bracket in Art. 50 lets in people with only earned income up to 5 million won. Any other income amount means the bracket no longer applies and the 1 million won total is used (our reading).
Income left out — Art. 14(3)
| Type | What the source says | Worth noting (ours) |
|---|---|---|
| (ii) Daily work | Earned income of daily workers | Not in gross pay |
| (vi) Interest and dividends | Withheld, totalling 20 million won or less | Above that, the calculator counts it all (our simplification) |
| (vii) Home rental | Home rental income where revenue totals 20 million won or less | Leave out of business income (our reading) |
| (viii)(a) Other income | Withheld other income amounts of 3 million won or less, unless you choose to add them | Lecture or writing fees; optional |
| (ix)(c) Private pensions | Pension income other than pensioned severance or medical withdrawals, totalling 15 million won a year or less, unless added | Optional |
The text says these are not added “when computing the global income tax base”; that they also drop out of the Art. 50 income amount is our reading of the two together. Check NTS guidance at the margin.
Six cases — our example
| Case (ours) | Income amount → result | Worth noting (ours) |
|---|---|---|
| Student, pay 4.8 million won | 4.8 − 3.36 = 1.44 million → passes | Earned income only, up to 5 million |
| Student, pay 5.2 million | 5.2 − 3.58 = 1.62 million → fails | Over 5 million |
| Parent, public pension 5.16 million | 5.16 − 4.164 = 996,000 won → passes | 5.2 million gives 1.02 million |
| Parent, pension 4 million + other income 2.5 million | 300,000 won → passes (separate) / 2.8 million → fails (added) | The choice matters |
| Parent, pension account 12 million only | 0 → passes | 15 million or less, separate |
| Parent who retired this year, retirement income 15 million | 15 million → fails | The retirement year is easy to fail |
The third line: 5.16 million minus (3.5 million + 1.66 million × 40% = 4,164,000) = 996,000 won. The pension at which the income amount reaches 1 million won is about 5,166,000 won (our arithmetic). Use the taxable total pension shown on the pension service’s withholding receipt (the taxable range is in the Decree, which we did not read).
If the student on 4.8 million also has a 500,000 won capital gains income amount, the total is 1.94 million and the earned-income-only bracket is lost (our reading). The basic deduction items are in year-end personal deductions.
Checklist
- ☐ Each relative’s gross pay, pension receipt and business return
- ☐ Anyone who got severance or sold land or a home this year
- ☐ Separate taxation chosen for other income and private pensions?
- ☐ Earned income only and pay up to 5 million?
- ☐ No double claiming of the same parent by siblings
Questions that remain
Do non-taxable allowances count?
No — Art. 20(2) excludes non-taxable income from gross pay and Art. 14(3)(i) keeps it out.
What if the business made a loss?
Enter 0. We did not read the loss offset rules (Art. 45).
Do disabled dependants face the income test?
The bracket lifts the age limits only; the 1 million won test remains (our reading).
Sources
- Korean law database (law.go.kr) — Income Tax Act Art. 50 and related — source (current text, effective 1 July 2026, Act No. 21221; checked 3 November 2026). Art. 50(1) (1.5 million won; income amount up to 1 million or earned income only up to 5 million; ages; no age limit for the disabled), Arts. 4(1), 14(3)(i), (ii), (vi)–(ix), 19(2), 20(2), 20-3(3), 21(3), 22(3), 47 (table, 20 million cap), 47-2 (table, 9 million cap).
- Not read. The Decree (descendants, daily workers, taxable public pension range), Art. 51 additional deductions, Art. 45 losses, Art. 17 gross-up, NTS guidance.
- What we added. The “worth noting” column and the Korean everyday gloss.
Where to check further
- Hometax simplified year-end service — dependants’ data consent.
- National Pension Service and others — pension withholding receipts.
Written on 3 November 2026. The content is from the source; the glosses are ours.
