The “tax-free” column on a Korean payslip does more than cut income tax. Article 20(2) of the Income Tax Act calls the sum of employment income minus tax-free income “total salary”, and the employment income deduction and the tax rates both start from that figure. But each tax-free allowance carries its own limit and conditions, so not everything your employer labels a “meal allowance” is exempt. Enter total monthly pay and four allowances (meals, car, childcare, research) and the calculator splits each into the exempt part and the part left as taxable pay, using the limits in the law.
1. Four allowances with a ₩200,000-a-month limit — meals (for employees not provided with meals, Act Art. 12(3)(reo)), the car allowance (Decree Art. 12(3)), research allowances (same article, item 12), and childcare for children aged 6 or under at ₩200,000 a month per child (Act Art. 12(3)(meo)2)).
2. Anything above the limit is taxable — a ₩250,000 meal allowance is exempt only up to ₩200,000; the other ₩50,000 goes into taxable pay. If you are given canteen meals, the cash meal allowance falls outside the item (our reading).
3. Our example — ₩3.5 million a month (including a ₩200,000 meal allowance and a ₩200,000 car allowance) gives ₩400,000 exempt and ₩3.1 million taxable pay a month, or ₩37.2 million taxable pay over 12 months.
Calculator
Results update as you type. Amounts in won. Total monthly pay includes the allowances. The 12-month lines are our arithmetic assuming the same pay every month; bonuses, overtime pay and other exemptions (childbirth support, production workers’ overtime and so on) are not included. “Aged 6 or under” is judged on 1 January of the year — for 2026, children born on or after 1 January 2020 (our arithmetic).
The law — as written
| Provision | What it says | Points to note (our reading) |
|---|---|---|
| Act Art. 12(3)(reo) | Meals or other food an employee receives through an in-house canteen or similar, or a meal allowance of ₩200,000 or less a month received by an employee (limited to those not provided with meals or other food) | In-kind meals and a cash allowance are split by “or” — if you get meals, the cash allowance hits the bracket |
| Decree Art. 12(3) | Day-duty or night-duty pay or travel expenses at a level of reimbursement (including, of the amount an employee receives under the employer’s rules instead of actual travel costs when the employee personally drives a car they own or lease in their own name for the employer’s business, up to ₩200,000 a month) | All three conditions must hold — the calculator takes them as one “conditions” box |
| Decree Art. 12(12) | Of research subsidies or research activity expenses received by any of the following, up to ₩200,000 a month: (a) teachers at schools under the Early Childhood, Elementary and Secondary, and Higher Education Acts; (b) people directly engaged in research at designated, government-funded or local-government-funded research institutes, and others; (c) people directly engaged in research at a recognised R&D lab or department of an SME or venture company | The calculator does not ask about item (b)’s qualification and ministerial-rule limits |
| Act Art. 12(3)(meo)2) | Pay received from the employer for the care of a child of the employee or spouse who is aged 6 or under on the first day of the tax period (meaning up to and including the day the child turns 6), up to ₩200,000 a month per child | Two children means a ₩400,000 monthly limit |
| Act Art. 20(2) | Employment income amount is the sum of the income in paragraph (1) (excluding tax-free income; “total salary”) after the employment income deduction under Article 47. | The calculator’s “taxable pay” is what goes into total salary |
Decree Article 12 lists more “up to ₩200,000 a month” items that the calculator leaves out: item 10, the boarding allowance of seafarers specified by ministerial rule; item 14, the reporting allowance of journalists at media companies (if it is folded into pay, ₩200,000 is treated as the reporting allowance); item 15, the remote-area allowance for work in places specified by ministerial rule; and item 17, the temporary relocation allowance for staff of public bodies moving out of the capital region. If one applies to you, add it by hand in place of the research box (our suggestion).
The “people” and “remote areas specified by ministerial rule” are in the Enforcement Rule of the Income Tax Act. The boarding allowance (item 10) covers the master and crew under Article 2(3) and (4) of the Seafarers Act (Rule Art. 6-3). For the remote-area allowance (item 15), remote areas are: (1) areas in Schedule 1 of the rule on special-location allowances for public officials; (1-2) areas in Schedule 1 of the equivalent rule for local public officials (for county areas among remote and island areas, the whole township listed); (2) areas in the schedule to the Enforcement Rule of the Act on the Promotion of Education in Islands and Remote Areas; (3) areas registered as mining districts under the Mining Industry Act; and (4) medically underserved areas in Schedule 1 of the Rule (medical personnel under Medical Service Act Art. 2 only) (Rule Art. 7). Under item 12(b), “people who directly support research activity” are staff of designated, government-funded or local-government-funded research institutes other than those directly engaged in research (with qualifications equivalent to university faculty), those doing day-to-day building care such as security, maintenance, repair and cleaning, and those providing meals or driving vehicles (Rule Art. 6-4) — so researchers come in as “directly engaged”, administrative and similar support staff come in under this rule, and facilities, canteen and driving staff are left out (our reading). The place names in each area list are not reproduced here.
How the calculator works — our reading
| Line | Arithmetic | Points to note (our reading) |
|---|---|---|
| Meal allowance, exempt | min(allowance, ₩200,000) if no meals are provided; 0 if they are | The bracket in item (reo), read as written |
| Car allowance, exempt | min(allowance, ₩200,000) if the conditions hold; otherwise 0 | Actual travel costs paid on top means it is not “instead of” |
| Childcare allowance, exempt | min(allowance, ₩200,000 × children aged 6 or under) | With no such child it is all taxable |
| Research allowance, exempt | min(allowance, ₩200,000) if eligible; otherwise 0 | Any of items (a) to (c) |
| Taxable pay, a month | total monthly pay − exempt in total | Not calculated if the allowances exceed total pay |
Five cases — our examples
| Case (our example) | Result | Points to note (our reading) |
|---|---|---|
| ₩3.5 million a month, ₩200,000 meals, ₩200,000 car | ₩400,000 exempt · ₩3.1 million taxable pay a month | Over 12 months: ₩37.2 million taxable, ₩4.8 million exempt |
| Same pay, ₩250,000 meals (no car allowance) | Only ₩200,000 of meals exempt · ₩50,000 taxable · ₩3.3 million taxable pay | The part over the limit goes into taxable pay |
| Same pay, canteen meals plus a ₩200,000 meal allowance | Meal allowance exempt: 0 · ₩3.5 million taxable pay | In-kind meals exempt; the cash allowance hits the bracket (our reading) |
| ₩4 million a month, ₩200,000 each for meals and car, ₩300,000 childcare, one child aged 6 or under | ₩600,000 exempt · ₩3.4 million taxable pay | With two such children the whole ₩300,000 fits: ₩700,000 exempt · ₩3.3 million taxable |
| The two-child case plus a ₩200,000 research allowance at an R&D lab | ₩900,000 exempt · ₩3.1 million taxable pay | Four ₩200,000 limits plus ₩200,000 per child |
Each extra ₩200,000-a-month exemption takes ₩2.4 million out of total salary over 12 months (our arithmetic). Equally, if your employer raises the meal allowance to ₩250,000, the extra ₩50,000 is taxable pay, not tax-free.
Related calculators
- Childbirth support — two payments within 2 years of the birth, exempt in full with no cap: childbirth bonus tax-free checker.
- Production workers’ overtime, night and holiday pay — the base-pay and prior-year thresholds and the ₩2.4 million cap: overtime pay tax-free calculator.
- Take-home pay after exemptions — put this calculator’s total into the “tax-free (monthly)” box of the net salary calculator.
- The conditions item by item — non-taxable pay allowances.
Checklist
- ☐ Check which items your payslip treats as tax-free, and how much
- ☐ If you get canteen meals, check whether the meal allowance is still marked tax-free
- ☐ Car allowance — whose name the car is in, whether you drive, whether travel costs are paid separately
- ☐ Childcare allowance — children aged 6 or under on 1 January
- ☐ Whether anything above a limit has been counted as taxable pay
Questions that remain
If the meal allowance is over ₩200,000, is only the excess taxable?
Item (reo) exempts “a meal allowance of ₩200,000 or less a month”. The calculator treats up to ₩200,000 as exempt and the excess as taxable pay. We have not taken the reading that the whole allowance becomes taxable (our reading).
Does the childcare exemption still apply in the year my child turns 7?
The test date is “the first day of the tax period”, i.e. 1 January. If the child was 6 or under on 1 January, the whole tax period counts even if the birthday passes during the year (our reading). For 2026 that means children born on or after 1 January 2020 (our arithmetic).
Is the result my withholding tax?
No. This calculator stops at taxable pay (the part that enters total salary). Monthly withholding follows the National Tax Service’s simplified tax table and your number of dependants — continue in the net salary calculator.
Sources
- Korean Law Information Center — Income Tax Act Arts. 12(3) and 20 — original text (current version, in force 1 July 2026, Act No. 21221; checked 10 November 2026). Item (reo) meal allowance ₩200,000 a month and its bracket, item (meo)2) ₩200,000 a month per child aged 6 or under, Art. 20(2) total salary.
- Korean Law Information Center — Enforcement Decree of the Income Tax Act, Art. 12 — original text (current version, in force 1 October 2026, Presidential Decree No. 36737; checked 10 November 2026). Item 3 car allowance ₩200,000 a month, items 10, 14, 15 and 17, item 12 research allowances ₩200,000 a month.
- Korean Law Information Center — Enforcement Rule of the Income Tax Act, Arts. 6-3, 6-4 and 7 — original text (current version, in force 1 July 2026, Ministry of Finance and Economy Ordinance No. 33; checked 10 November 2026). Boarding allowance (master and crew), who counts as research support staff, remote areas.
- Not read. The area lists in the rules and schedules that the remote-area definition points to, and National Tax Service rulings.
- What we added. Splitting the excess over each limit into taxable pay, the reading that the meal allowance is taxable when meals are provided, the birth-date cut-off for age 6, the 12-month multiplication, and the “points to note” column.
Where to check further
- Your payroll team — the names and rules of each allowance (for the car allowance, a payment standard in the company rules is part of the condition).
- NTS Hometax — the tax-free income boxes on your year-end withholding receipt.
Written on 10 November 2026. The provisions are quoted from the original; the readings and arithmetic are ours.
