Korean Job Discussion Forums

[Dome Vans]

I thought I'd start a thread about something that crops up in loads of contracts. 3.3% tax is stated in the contract.

I thought it'd be good to see reasons why this tax rate stated in the contract is not good. I know it's used as a independent contractor rate, and shouldn't be used for E2 visa workers. This way of calculating tax means that a teacher will end up losing a fair bit of cash because employers are deducting 3.3% every month (if at all) and not taking the money on a sliding scale. So your payment actually reduces over the months.

I also found it strange with the thread recently about the boss who was declaring that the teacher only earned 1.4 million won a month. The tax office had given the declaration forms to the teacher to fill out. Is that normal for Hagwon teachers? I think that the teacher was also having the 3.3% taken out every month as well.

I hope this thread gets some of the forum brainiacs to put forward their ideas and facts on this question, and clarify a few of the points. Ttom, TUM, Gary Kasparov, Centralcali, DongtanT, cresschaef etc any views to educate people?

[BigBuds]

The 3.3% tax rate comes from about a year and a half to two years or so ago when all foerign English teachers were on a 3.3% standard tax rate. The Korean tax department reclassified us the same as Korean employees and we went on the sliding tax rate which we now have.

Unfortunately, the tax department didn't tell anyone about it and just put a note on their website when it was changed over so most school directors didn't know about the change and still many don't know about it unless you direct them to the Korean tax website to see for themselves.

That's why you still see the 3.3% tax rate popping up in contracts as that's what they have always had and don't know about the change.

One good thing though is, that if you are being deducted for the 3.3% tax rate is that you can claim it back as a tax refund. That is, if you director is actually paying your taxes to the Korean tax department.

Some dishonest directors however, still tax you at 3.3% and pocket the difference. If you want to find out you can go to the tax deparmtent yourself to see what tax rate you are being deducted at.

[icicle]

Do you know if there is a specific reference or link to this either in Korean or English on their website ... I would like if possible to have that before I talk to my new employer about it .... I figured that even if it was taken out at the 3.3% rate it could be sorted out later at the end of the tax year (I don't get my first pay for a few weeks yet). This is the first time I have seen an explanation to why the problem has arisen (outside of employers who are trying to do the wrong thing) ... It would be good to get a reference which confirmed the change which occured

Icicle

[Dome Vans]

Oops, my bad! I didn't realise that it had been covered as much as it has but I've read over these and they're very interesting.

http://forums.eslcafe.com/korea/viewtopic.php?t=121277&highlight=independent+contractor

http://forums.eslcafe.com/korea/viewtopic.php?t=101462&postdays=0&postorder=asc&start=0

[creesschaef]

Well, you can go here . It's the website for the National Tax Service, which allows you to input your monthly pay and see how much you should be paying. It also has a spreadsheet that can be printed out to show to your school. If there are any issues, just call the NTS and talk with them. The last thing a school wants is the NTS on their ass.

Phone #: +82-2-397-1440

[eurasian76]

are all part time gigs taxed at 3.3%? thanks

[xingyiman]

3.3 is a whole lot less than I paid back home. I ain't complaining.