Four Insurances and the Tax After Them
A Korean payslip carries four statutory insurance deductions before income tax is even considered: national pension, health insurance, long-term care insurance calculated on top of health, and employment insurance. Together they typically remove a little under ten per cent of taxable pay, which is why the gap between gross and net is wider than the income tax rate alone suggests.
This calculator applies all four along with income tax and local income tax, working from your annual salary and any non-taxable allowance.
How to Calculate Your Net Salary
Three inputs matter: the salary, the non-taxable portion and the number of dependants.
- Enter your annual gross salary. The calculator divides it into monthly figures, which is how Korean payslips are presented.
- Enter your non-taxable allowance. Meal allowance up to a monthly limit and certain vehicle allowances are excluded from both tax and insurance calculations.
- Enter the number of dependants, which reduces the withheld income tax.
- Read the four insurance deductions separately. They are calculated on taxable pay rather than on gross, which is why the non-taxable figure matters.
- Read income tax and local income tax, the latter being ten per cent of the former rather than of your salary.
How the Four Insurances Are Calculated
National pension is 4.75% of taxable monthly pay, matched by the employer, but only between a floor and a ceiling: below 410,000 won a month the contribution is charged as though you earned that, and above 6.59 million won it stops increasing. The rate left the 9% it had held since 1998 in 2026 and rises half a point a year to 13% by 2033, so the employee half moves with it. Health insurance is 3.595% with no ceiling, and long-term care insurance is charged as 13.14% of the health insurance amount rather than of salary, which is why it looks small on a payslip. Employment insurance is 0.9%.
Each of these is the employee half; the employer pays a matching or larger share that never appears on your payslip. The total employer cost of an employee is therefore meaningfully higher than the gross salary figure, which is worth knowing when comparing an employment offer against contract work where you would carry both halves.
Statutory Deduction Rates
Employee-side rates applied to taxable monthly pay in this calculator.
| Deduction | Rate | Base | Notes |
|---|---|---|---|
| National pension | 4.75% | Taxable monthly pay | Floor 410,000 won, ceiling 6.59 million won |
| Health insurance | 3.595% | Taxable monthly pay | No ceiling |
| Long-term care | 13.14% | Health insurance amount | Not of salary |
| Employment insurance | 0.9% | Taxable monthly pay | No ceiling |
| Local income tax | 10% | Income tax amount | Not of salary |
Two of these are charged on another deduction rather than on pay: long-term care on health insurance, and local income tax on income tax. Reading them as percentages of salary makes them look far larger than they are.
The Income Tax Figure Is an Approximation
Korean withholding tax is set by a published schedule that accounts for salary level, dependants and other circumstances in more detail than a simple bracket calculation can. This tool applies a simplified progressive approximation, so the income tax figure it produces is indicative rather than exact, and the actual amount withheld from your payslip will differ.
The year-end settlement is where it is resolved. Deductions for housing, insurance premiums, medical expenses, credit card spending and pension savings are applied then, and most employees receive a refund or pay a balance at that point. Anyone planning around the number should use the National Tax Service’s own calculator or their payroll department rather than this estimate.
Severance pay is the other thing a monthly figure does not show. An employee with a year or more of service is generally entitled to it on leaving, and because it is taxed separately from salary it does not appear anywhere in a monthly net calculation. When comparing a Korean offer against one from a country without that entitlement, it is a real part of the package that a payslip comparison leaves out entirely.