Korean Job Discussion Forums

[amemorylost]

In spite of what the question implies, I have actually done a lot of looking on the NTS website and the English documents they provide, as well as a lot of searching of this forum, and I've yet to find anyone giving the current rate for workers in a Hagwon. (I earn 2.1 Million Per Month)

From accounts on this forum, I gather that the rate of monthly should be somewhere around 4-5% or about 30,000 Won per month. But the only rate I've found seems to be the 17% tax on gross income.

My current situation is that my first and second month pay were deducted about 30,000 in tax, which I thought was normal for a tax rate less than 5% and with the Tax Incentive for Foreign Workers giving you 30% of your wage tax-free.

My Hagwon boss now tells me that this will need to increase to 5.5% on my total earnings, and if I wanted the 30% Tax Incentive, I would need to pay a tax rate of 17%. I'm fairly sure that's wrong, but it's been difficult to find any clear indications of what I should be paying in the NTS documents.

Any help would be much appreciated.

[afsjesse]

Your director is a liar and a thief! I don'thave the link, but on a 2.1m salary your tax rate should only be like 1.7 percent or so. I did this for a friend last week on the website and 30,000 Won was about right for the tax. Don't get fleeced like I was when I worked in Hagwon hell..

[wesharris]

What particular hakwon do you work at? What's your bosses name? And why are you falling for his lies? Please realize that it is not right to be taken advantage of, the only fair thing on your part to do is to take advantage of him. Let yourself save face, and he lose face.
--
Wesley

[amemorylost]

Thanks for the replies, but they're not particularly helpful.

Specifically, what is the current rate of tax for foreign employees in a Hagwon earning the standard 2.1-2.2 Million?

Does not being part of the pension and health service affect either the tax rate or the 30% tax incentive for foreigners?

[nomad-ish]

here's the link for the national tax service -->

http://www.nts.go.kr/eng/help/help_52.asp?top_code=H001&sub_code=HS05&ssub_code=HSE2

input your salary in the box like this, 2.3 million won = 2300

for the above example you should only be paying 44,290 won a month or roughly 1.8%. if he backtracks and says 3.3%, that's wrong too. that's the rate for independent contractors (which i've read that as an E2 visa holder you cannot be)

[amemorylost]

Thanks. I had checked the calculator before, but I think the mistake I made was inputting 2.1 million as 2100000. I'll try again.

Incidently, I assume that calcuation doesn't takethe 30% exemption into account?

[ttompatz]

The tax on a salary of 2.1 million is 1.7% per month (w35.560).

There should also be a deduction of 4.5% for pension and 2.54% for medical.

Your TOTAL in legal deductions should be 8.74% of your total salary.

If you are paying anything different you ARE being cheated out of something as well as being overtaxed.

.

[amemorylost]

Ah, I think I understand my problem a bit better now.

My boss doesn't want to opt in to the pension and health scheme. Without pension and health, the tax agent my employer uses quoted 5.5% tax, which is obviously cheaper than the 8% but without pension and health.

Without pension and health, is the lower tax rate not applicable?

And does the 30% exemption apply in both cases?

[Ramen]

[wesharris]

The 30 % exemption doesn't really apply or matter to you. You're here to work. Concentrate on a tax rate around 1.8 %, 2.5 and another 4.5 or so . That's all. Any tax you'll pay you'll most likely get back anyhow.
Wesley

[amemorylost]

[Teelo]

[ttompatz]

Your tax rate doesn't change because your boss is cheating you out of your health care insurance and pension benefits.

Even if you were listed as an independent contractor (again you are getting cheated) your rate would only be 3.3%.

[amemorylost]

Thanks, that's pretty much what I wanted clarified.

The impression I get is that the former foreign never questioned any of the deductions or asked for any official receipts/forms, and that the Hagwon manager entrusts everything to do with tax to his tax-agent. I get on incredibly well with my manager, which is a bit awkward in this situation but I'm hoping it's the agent trying to screw me indirectly by saving him money.

[hari seldon]