If you collect monthly rent in Korea, the worry is familiar: "do I have to report this?" Rental income under ₩20M used to be exempt, but now it's often taxable regardless of amount — depending on how many homes you own and how you rent.
First rule: homes are counted per married couple, combined — not just what's in your name.
Are you taxable? (combined household homes)
- One home — generally exempt. Exception: monthly rent from a home with a published price above ₩1.2B (or a home abroad) is taxable.
- Two homes — monthly rent is taxable. (Jeonse deposits are not taxed.)
- Three or more — monthly rent taxable, plus deemed rental income on deposits above ₩300M combined.
Small homes are excluded from the deposit count — under 40㎡ with a published price of ₩200M or less.
⚠️ Changing from the 2026 tax year: owners of two high-value homes (published price above ₩1.2B) also face deemed rental income if combined deposits exceed ₩1.2B.
Two ways to be taxed
If total rental income is ₩20M or less a year, you choose whichever is better:
- Separate taxation — rental income taxed alone at 14%
- Comprehensive taxation — combined with salary and other income at progressive rates
Above ₩20M, comprehensive taxation is mandatory.
Registering cuts the tax sharply
Under separate taxation, it matters whether you registered as a rental business with both the tax office and the local government.
- Unregistered — expense rate 50%, basic deduction ₩2M
- Registered (meeting conditions such as capping rent increases at 5%) — expense rate 60%, basic deduction ₩4M
Example — ₩10M annual rent, registered:
- ₩10M − ₩6M expenses (60%) − ₩4M deduction = taxable base of zero
- In other words, no tax due.
Note the basic deduction applies when other comprehensive income is ₩20M or less.
If you don't report
- Having rental income without registering brings a penalty of 0.2% of rental income.
- Non-filing, under-reporting and late-payment penalties can apply on top.
- Lease records from fixed-date stamps and move-in reports mean the rental is visible. Assuming nobody knows is risky.
When to file
With your May comprehensive income tax return, through Hometax.
FAQ
I own one home and rent it out.
Exempt if the published price is ₩1.2B or less; taxable above that.
I only take jeonse deposits.
One- and two-home owners aren't taxed on deposits. From three homes, deemed rental income applies above ₩300M (and from 2026, high-value two-home owners too).
Separate or comprehensive — which is better?
With substantial other income, separate usually wins; with little other income, comprehensive may. Compare both on Hometax.
What about selling the property?
That's capital gains tax, a separate matter. Rental income tax applies to what you earn while holding.
Rental income already leaves a paper trail. Registration alone can bring the tax to zero — so learn the structure instead of avoiding the filing.
This is general information, not tax advice. Requirements and rates change — check National Tax Service guidance or a tax professional.
