On February 4, 2026, the Korean government announced the abolition of the 22-year-old punitive capital gains tax surcharge on multi-home owners. The additional tax rates (2 homes: +20%p, 3+ homes: +30%p) will be replaced by standard progressive rates of 6-45%, potentially saving multi-home owners up to 125 million KRW (approx. $100,000) in taxes.
However, the current temporary exemption expires on May 9, 2026. Until the abolition bill passes the National Assembly, this deadline is critical. This guide covers the changes, tax savings calculations, and timing strategies.
Key Changes
| Category | Before (Surcharge) | After (Abolished) |
|---|---|---|
| 2-home owners | Base rate +20%p (max 65%) | Base rate only (6-45%) |
| 3+ home owners | Base rate +30%p (max 75%) | Base rate only (6-45%) |
| Long-term holding deduction | Excluded under surcharge | Up to 30% deduction |
Tax Savings Simulation
For a capital gain of 500 million KRW:
- 2-home owner: ~150M (surcharge) vs ~50M (base rate) = ~100M KRW savings
- 3-home owner: ~175M (surcharge) vs ~50M (base rate) = ~125M KRW savings
Critical Deadline: May 9, 2026
The current temporary exemption expires on May 9. The "transfer date" is determined by the balance payment date or registration date (whichever comes first). Sellers should finalize contracts by March-April to ensure completion before the deadline.
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