Year-end tax settlement

Year-end settlement is called "the thirteenth salary". Claim it and you get money back; skip it and you don't.

What it is

A process comparing and reconciling the tax withheld each month with the tax actually due.

• Overpayment is refunded.
• Underpayment is collected.
• It is usually handled through your employer early in the year.

Steps

1. Follow your company's guidance — usually in January or February.
2. Download your data from Hometax's "simplified year-end settlement service" — medical costs, insurance premiums, card spending and more are gathered automatically.
3. Prepare additional documents. Items not captured by the simplified service (some donations, monthly rent) must be gathered yourself.
4. Submit to your employer.
5. Check the result — it is reflected in your salary.

Deduction items and requirements change every year. Always confirm the current rules on Hometax or with 126.

Worth claiming (main items)

• Medical expenses — treatment receipts. See medical-records.
• Monthly rent — deductible if you qualify. The contract and transfer records are needed.
• Insurance premiums and pensions
• Education costs
• Donations
• Dependants — family members meeting the requirements.

If you don't work for a company

You settle through the comprehensive income tax return (usually in May). This applies to freelancers and sole traders. Ask 126 or a tax office.

Where to go

• 126 National Tax Service call centre
• Hometax www.hometax.go.kr
• Your local tax office
• Your company's payroll or HR staff
• 1577-1366 interpretation

Questions people ask

Do foreigners do year-end settlement? Yes, if you have employment income. Special provisions may apply to foreigners — check with 126.

Can I claim family in my home country as dependants? Requirements and evidence apply. Translated and certified family documents may be needed. Check with 126 in advance.

My company doesn't do year-end settlement. File a comprehensive income tax return yourself or consult 126. Missing it means no refund.

Hometax is in Korean and it's hard. Visit a tax office or ask your company's staff for help. Use 1577-1366 interpretation alongside.

Take care

Claiming deductions falsely leads to collection with surcharges later. Don't include someone else's data or expenses you didn't actually incur. Accurate data alone still produces a refund in most cases.

Related

income-tax-basics · hometax-foreigners · tax-refund-departure · medical-records

Source

National Tax Service www.nts.go.kr / As of 2026-08