Freelancer Tax Calculator
Calculate withholding and income tax for freelance income.
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Overview
Freelancers in South Korea who provide personal services typically have 3.3% (3% income tax + 0.3% local income tax) withheld from their payments. This withheld amount is credited against the final tax liability when filing the annual comprehensive income tax return in May. Depending on actual income and deductions, freelancers may receive a refund or owe additional tax.
Formula
Withholding Tax = Income x 3.3%. Final Tax = (Total Revenue - Expenses - Deductions) x Progressive Rate - Tax Credits - Prepaid Tax. Expenses can be actual costs or standard expense ratios.
How to Use
- 1Enter your total annual freelance income.
- 2Input expenses (actual costs or select an expense ratio).
- 3Enter deduction items (personal exemptions, pension contributions, etc.).
- 4Click Calculate to see withholding tax, income tax, and refund or additional payment.
Tips
- ✔Freelancers earning under KRW 24 million annually may qualify for simplified expense ratios, reducing taxable income.
- ✔If actual expenses exceed the standard ratio, keeping books (simplified or double-entry) is more advantageous.
- ✔National pension and health insurance premiums can be claimed as income deductions.
- ✔The annual filing deadline is May 31.
- ✔Those earning KRW 75 million or more must keep double-entry books; failure to do so incurs penalties.
FAQ
Q. Do I owe more tax after the 3.3% withholding?
The 3.3% is a provisional withholding. When you file your annual return in May, the actual tax is calculated. If the actual tax is less than what was withheld, you get a refund. If it is more, you pay the difference.
Q. What is the difference between simplified and standard expense ratios?
The simplified ratio allows a high flat percentage of revenue as expenses. The standard ratio requires documentation for major expenses (purchases, rent, labor), with only the remainder covered by the ratio. Higher earners must use the standard ratio.
Q. Do freelancers need to register as a business?
Personal service income (writing fees, lecture fees, design fees, etc.) can be handled through 3.3% withholding without business registration. However, registering may be beneficial if you need VAT refunds or have high revenue.
Q. What deductions can freelancers claim?
Personal exemptions, national pension premiums, health insurance premiums, private pension savings, and small business mutual aid (Yellow Umbrella) contributions are deductible.
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