Your parents offer to help with a jeonse deposit; you receive a lump sum when you marry. "Is that taxable?" In Korea, money between family members is subject to gift tax above certain amounts — but generous deductions mean much of it is tax-free.
Key rule: the gift deduction is counted on a rolling 10-year basis. It isn't per gift — it's the total across ten years.
Deduction limits by relationship (10-year total)
- Spouse — ₩600M
- Parents/grandparents → adult child — ₩50M
- Parents/grandparents → minor child — ₩20M
- Child → parents/grandparents — ₩50M
- Other relatives (siblings, in-laws) — ₩10M
Amounts above these limits are taxed at progressive rates of 10–50%.
Marriage and childbirth add ₩100M (since 2024)
- Within 2 years before or after registering a marriage, or within 2 years of a child's birth
- Gifts from parents or grandparents get up to ₩100M in additional deduction
- It's separate from the ₩50M basic deduction → up to ₩150M tax-free
Careful: marriage and birth deductions share one combined ₩100M limit, not ₩100M each. Use it all at marriage and nothing remains for a birth.
Note also that each side of the family can give separately, so a couple's combined total can be larger.
What isn't treated as a gift
Not every won moving between relatives is a gift. Living expenses and education costs within social norms are exempt — with conditions:
- The money must actually be spent on living or education costs.
- If you save it or buy stocks or property with it, it counts as a gift.
- Support given to someone who can support themselves may not qualify.
Traps people fall into
- The 10-year total — ₩30M received five years ago leaves only ₩20M of room now.
- "Borrowed" money without a contract — a loan from parents needs a written agreement, interest payments and repayment records to avoid being deemed a gift.
- Skipping a generation — gifts straight to grandchildren carry a 30% surcharge on the computed tax.
- Funds for buying property — if you can't explain the source in a review, it may be presumed a gift.
Filing
File within three months from the end of the month in which the gift was received, via Hometax or your tax office. Even when no tax is due, filing creates a record that helps prove your source of funds later.
FAQ
My parents covered my jeonse deposit.
Above the deduction it's taxable. If it's a loan, keep the contract and actual interest and principal payment records.
What about monthly allowances?
Generally fine if genuinely spent on living costs — but accumulating it to buy assets can be treated as a gift.
How is this different from inheritance tax?
Giving while alive is a gift; transfer after death is inheritance. Rates are similar but deductions differ, and inheritance rules are an active area of reform — check separately.
Family money is tracked on a ten-year ledger. If a large transfer is coming, plan ahead and keep the paperwork.
This is general information, not tax advice. Requirements and rates change and depend on your situation — confirm with Hometax or a tax professional.
