Businesses in Korea that keep no books estimate expenses at government-set rates on the May return. The simple expense rate treats a fixed share of revenue as expenses. Income Tax Decree Article 143(4) applies it to new businesses or those whose previous year’s revenue is under the sector line — 60, 36 or 24 million won — provided this year’s revenue is also under the simple-books line (300m, 150m or 75m). Freelance personal services sit in the 36 million won group.
1. Simple rate: last year’s revenue under 60m, 36m or 24m won (or a new business).
2. And this year’s revenue under 300m, 150m or 75m won.
3. Freelance personal services are listed in the 36 million won group (b).
Two conditions — Art. 143(4)
| Type | What the source says | Worth noting (ours) |
|---|---|---|
| Condition 1 | Started business this year, or last year’s revenue under the table figure | Includes assessed increases |
| Condition 2 | This year’s revenue under the Art. 208(5)2 figure (simple-books line) | Even new businesses are out if this year is large |
Sector figures — Art. 143(4)2
| Sector group | Last year (under) | This year (under) |
|---|---|---|
| (a) Farming, mining, wholesale/retail, property trading etc. | 60 million won | 300m |
| (b) Manufacturing, food and lodging, construction, transport, ICT, finance, brokerage, personal services (VAT-exempt) | 36 million won | 150m (personal services: group (c) 75m) |
| (c) Property letting, professional services, education, health, arts, associations, other personal services etc. | 24 million won | 75m |
Personal services fall in group (b) for the simple rate, but for simple books the whole “repair and other personal services” sector is in group (c), so we read this year’s line as 75 million won (our reading).
Our examples
| Freelancer (personal services) | Simple rate | Worth noting (ours) |
|---|---|---|
| Last year 30m, this year 50m | Applies | Under 36m and under 75m |
| Last year 36m, this year 30m | Doesn’t apply | “Under” excludes 36m itself |
| Started this year, 80m this year | Doesn’t apply | New, but 75m or more |
The sector rates themselves are published yearly by the NTS and aren’t set out here. For all three lines at once, use the bookkeeping checker. Reclaiming the 3.3% withheld is in freelancer tax refund.
Checklist
- ☐ Last year under the sector line (or new this year)
- ☐ This year under the simple-books line
- ☐ Exactly at the line isn’t “under”
- ☐ Personal services: 36 million won
- ☐ Check the rate itself in the NTS notice
Questions that remain
If the simple rate doesn’t apply?
Article 143(3) applies the standard expense rate method to other estimated cases, which is outside this post.
New this year but high revenue?
Condition 2 means a new business at or above the simple-books line isn’t eligible.
Sources
- Korean law database (law.go.kr) — Income Tax Decree Art. 143(4) — source (current text, effective 1 October 2026, No. 36737; checked 19 October 2026). Two conditions, sector lines of 60m, 36m and 24m, where personal services sit, the link to Art. 208(5).
- Not read. The NTS rate notice, the standard rate under Art. 143(3).
- What we added. The “worth noting” column and the Korean everyday gloss.
Where to check further
- NTS Hometax — simple and standard rates by sector code.
Written on 19 October 2026. The content is from the source; the glosses are ours.
