Gains on overseas shares, such as US stocks, are taxed as capital gains in Korea. Income Tax Act Article 94(1)3(c) covers shares issued by foreign companies or listed on foreign markets, and Article 104(1)12 taxes non-SME shares at 20%. Share gains get a 2.5 million won annual basic deduction (Art. 103). A 10 million won gain over the year means (10m − 2.5m) × 20% = 1.5 million won. The calculator works from gains and losses in won.
1. Overseas share gains: 20% (SME shares 10%).
2. 2.5 million won deduction a year — no tax on gains up to that.
3. A 10 million won gain: 1.5 million won (local income tax extra; our example).
Calculator
Updates as you type. Enter gains and losses already converted to won. Uses the 20% rate for non-SME shares and the 2.5 million won deduction; local income tax, fees and exchange-rate rules aren’t included.
Reading the calculator
Enter the year’s gains from profitable sales in the first box and losses from loss-making sales in the second, both in won. “Net gain” is the difference, and “basic deduction” shows up to 2.5 million won of it. The large figure is 20% of the base after the deduction; a net gain of 2.5 million won or less shows 0. SME shares (10%) aren’t a separate option, so if you hold any, the real tax is lower.
The statute — Income Tax Act
| Type | What the source says | Worth noting (ours) |
|---|---|---|
| Scope | Shares issued by foreign companies or listed on foreign markets, as set by Decree (Art. 94(1)3(c)) | Scope in the Decree |
| Rate | SME shares 10%, others 20% (Art. 104(1)12) | Large US stocks fall under 20% (our reading) |
| Deduction | 2.5 million won a year on share income (Art. 103(1)2) | Same group as Korean major-shareholder shares |
How much — our examples
| Gain this year | Working | Tax (local tax extra) |
|---|---|---|
| 2 million won | Within the 2.5m deduction | 0 |
| 10 million won | (10m − 2.5m) × 20% | 1.5 million won |
| 30m gains, 10m losses | (20m − 2.5m) × 20% | 3.5 million won |
Netting losses against gains in the same year and group is our calculation. Netting with Korean shares and filing dates are covered in US ETFs vs Korean-listed ETFs.
Checklist
- ☐ Add January–December overseas gains and losses in won
- ☐ 20% after the 2.5m deduction
- ☐ SME shares: 10%
- ☐ Local income tax extra
- ☐ Use your broker’s won-based statement
Questions that remain
Which exchange rate applies?
The conversion rules are in the Decree, which we didn’t read. Your broker’s won-based statement is the safer figure.
Do Korean major-shareholder gains get a separate deduction?
Article 103 gives one 2.5 million won deduction for all Article 94(1)3 income; Korean major-shareholder shares and overseas shares sit in the same item (our reading). See major shareholder capital gains.
Sources
- Korean law database (law.go.kr) — Income Tax Act Arts. 94, 103, 104 — source (current text, effective 1 July 2026, Act No. 21221; checked 19 October 2026). Why overseas shares are taxable, 10% and 20% rates, 2.5m deduction.
- Not read. The Decree’s scope and won conversion, local income tax, filing dates.
- What we added. The “worth noting” column and the Korean everyday gloss.
Where to check further
- NTS Hometax — filing overseas share gains.
Written on 19 October 2026. The content is from the source; the glosses are ours.
