You feel a flash of joy when interest lands — then you see the actual amount and deflate. Interest and dividends in Korea are taxed at 15.4%. On ₩1M of gains, that's over ₩150,000 gone.
The account that sharply cuts this tax is the ISA (Individual Savings Account). Inside one account you can hold deposits, funds and Korean-listed ETFs, and part of your gains is tax-free, with anything above taxed at a low 9.9% separately.
Three ISA benefits
- Tax-free portion — net gains up to a limit (₩2M general, ₩4M "seomin"/lower-income) are completely untaxed.
- Loss offsetting — +₩3M in A and −₩1M in B means only the net ₩2M is taxed. A regular account taxes only the winner, so this is a big difference.
- Low separate rate — gains above the tax-free limit are taxed at just 9.9%, far below the usual 15.4%.
General vs. "seomin" (lower-income) type
The tax-free limit is double, so check your seomin eligibility first.
If your prior-year gross salary was ₩50M or less (or comprehensive income ₩38M or less), you qualify for seomin → ₩4M tax-free. Submit an income certificate (free, via Hometax or Gov24) when opening.
Before you open one
- 3-year minimum — closing within 3 years wipes out the tax benefits. If you need cash, don't close it — use "partial withdrawal" (up to your contributed principal).
- One account per person is the rule (as of 2026).
- Carry-over — unused annual limit rolls to next year, so simply opening the account early is already an advantage.
Note: 2026 tax reforms are moving to raise the contribution and tax-free limits. Confirm the current limits with your provider or Hometax when you open.
FAQ
Can I open one with no income?
Yes — any resident aged 19+ can open the general type even without income.
I heard rolling ISA maturity funds into a pension account helps?
Yes. Transferring maturity funds to a pension savings/IRP account earns an extra tax credit of 10% of the transferred amount (up to ₩3M).
Which type should I open?
If you want to trade stocks/ETFs yourself, the "brokerage" type is common. If you'd rather have it managed, trust or discretionary types exist.
The same money, the same trades — but the "account label" alone changes your tax a lot. If you're growing a lump sum you'll use in 3–5 years, open an ISA first.
This is general 2026 information, not investment advice. Limits, rates and rules can change — confirm the latest before opening.
