#Interest Income Tax
Related posts · 7 posts
Tax-Free Comprehensive Savings Checker (Korea) — Seniors on the Basic Pension, Disabled People and Five More Groups, 50 Million Won, Join by 31 December 2028
Restriction of Special Taxation Act Art. 88-2 charges no income tax on interest and dividends when one of seven groups, such as people 65 or over on the basic pension or registered disabled people, joins by 31 December 2028 with up to 50 million won per person. 50 million won at 3% for 12 months saves 231,000 won.
Interest Income Tax Calculator (Korea) — 15.4% Is 14% Income Tax Plus 1.4% Local Tax, 27.5% on Private-Loan Interest, Small Dividends Untaxed
Under Income Tax Act Art. 129, withholding tax on interest and dividends is 14% by default, and local income tax adds 10% of that, making 15.4%. Interest on a loan to a person is 25%, unconfirmed-name income 45%. Deposit interest of 1,000,000 won loses 154,000 won, leaving 846,000.
Splitting Your Accounts — The Law Only Fixes Two Things
Korea's deposit protection cap is ₩100 million, not ₩50 million (amended 29 Jul 2025). And “15.4%” is not a figure in the statute.
Pay Down the Loan or Keep the Deposit — 4.74m Won Over Five Years (2026)
A deposit rate above your loan rate still loses after tax. Breaking even needs 1.182 times the loan rate, and no such pairing exists in today's market.
Time Deposit or Installment — and the Trap in “Best Rate” (2026)
We worked out the exact multiple behind “an installment plan pays about half the headline rate”: an n-month plan yields (n+1)÷2n — 13/24, or 54.17%, over twelve months, converging on 50% as the term lengthens.
Korean Deposit & Savings Maturity Calculator — After Tax
A 3.20% deposit beats a 3.45% savings account by 1.71× after tax. The savings rate would need 5.91% to match.
Compounding and the Saving/Investing Line — CFPB's Example Ends at Year Two, Worth $2.50
Run the same conditions for thirty years and it becomes $1,821. Tax takes close to half of that.