Korean Job Discussion Forums

T-dot · Joined: 16 May 2004 Location: bundang

Is it taxed?

I'm given a housing allowance, but am taxed for it.
Basically my salary and housing allowance are taxed as 1 sum.

Just curious if its the same for everyone else.

seoul101 · Joined: 13 May 2006 Location: Seoul

Yeah, everything is taxed for me.. even my severance is taxed which is calculated from my taxed salary.

But hey, it's still small in comparison to western rates.

soju pizza · Joined: 21 Feb 2007

MODS! Make this a sticky!

PRagic · Joined: 24 Feb 2006

If it is taxed, then make sure that it is added to your gross salary when figuring out your severace!

seoul101 · Joined: 13 May 2006 Location: Seoul

PRagic, you're saying housing allowance should be added to your severance payment? Is that Korean law ?

Thunndarr · Joined: 30 Sep 2003

My housing allowance hasn't been taxed at either of the last two places I worked.

weatherman · Joined: 14 Jan 2003 Location: Korea

my current employer's accounting is just dodgy. my frist year it wasn't taxed, but the last two years it has been lumped together with my base pay and taxed.

T-dot · Joined: 16 May 2004 Location: bundang

Officially

You are taxed on your housing allowance. You are NOT taxed if the school provides housing.

BUT, the schools that have separated allowance and salary will not be taxed on the housing. (This is up to your schools accountant. It is technically illegal, but not really a big deal).

So, accountant is legally correct in taxing your housing allowance. But, if he likes you enough and is crafty, he can separate the 2 and save you approx. 600,000 won per year.

yingwenlaoshi · Joined: 12 Feb 2007 Location: ... location, location!

Most places don't remit their taxes or don't do so properly. So chances are that whatever you're taxed is in your school owner's pocket.

I believe that only a certain percentage of your housing allowance can be taxed (maybe one fifth) on anything up to 300,000/month. After that it's subjected to regular income tax. I'm not sure on all these details.

Severence pay is also not taxed the same way as income tax.

So if your boss is taxing you the same for income, housing allowance, and severence, you know something is up. If you've been at your employer for more than one contract, have you ever received tax receipts? If not, tell him to take his taxes and shove them where the sun don't shine. Well the housing allowance, anyway. It's always a good idea to have some taxes taken out of your salary whether you boss remits them or not.