Korea tax guide
Severance Pay Tax in Korea for Foreigners
Income Tax
Who this guide is for
- Foreign workers leaving a Korean job
- Employees checking final pay and severance
- People comparing salary tax and severance tax
- Foreigners preparing records after resignation
Quick Answer
Severance pay in Korea may be treated differently from ordinary monthly salary for tax purposes. Foreign workers should ask the employer for a clear severance calculation, withholding record, final payslip, and any retirement income document. Do not assume severance is tax-free or included in ordinary salary settlement without checking records.
Key points
- Severance pay can have separate tax treatment from salary.
- Final pay records should separate salary, unused leave, and severance if possible.
- Withholding documents matter for later filing or proof.
- Ask payroll before leaving Korea or changing employers.
Detailed explanation
Separate final pay items
When leaving a job, final pay can include regular salary, unused leave, bonus, severance, or other adjustments. Ask the employer to show each item clearly.
Why records matter
If you later file tax, check a refund, or need income proof, the final pay record helps explain what was paid and how tax was withheld.
Before leaving Korea
Download or request documents while you still have employer contact, Korean phone access, and bank access. It can be much harder after departure.
Documents you may need
- Severance calculation statement
- Final payslip
- Withholding records
- Employment contract
- Resignation or end-of-contract documents
- Bank deposit record
Common mistakes
- Treating severance as ordinary monthly salary without checking
- Leaving without a final pay breakdown
- Ignoring withholding on severance
- Confusing pension refund with severance pay
When should you ask a tax professional?
Ask a qualified tax professional if you have income from several countries, business income, unclear tax residency, treaty questions, missing documents, late filing concerns, or a visa situation that depends on tax records. This site explains general patterns only and cannot review your personal facts.
FAQ
Is severance pay taxed in Korea?
It may be subject to tax treatment separate from ordinary salary. Ask the employer for withholding and calculation records.
Is severance the same as pension refund?
No. Severance pay, national pension refund, and tax refund are different issues.
What document should I ask for?
Ask for a severance calculation statement, final payslip, and any withholding or retirement income records.
Can severance affect my income proof?
It may affect official records depending on how it is reported. Check Hometax and employer documents.
Official Sources to Verify
Check the tax year, eligibility conditions, and publication date in the official material before applying a rule. A link marked “Service portal” helps you find a service; it does not substantiate a particular rate or entitlement.