Korean Job Discussion Forums

Beeston27 · Joined: 03 Mar 2009

In order to avoid being taxed on income from teaching as I believe should be the case, what process do you go through?

stuck · Joined: 26 Mar 2009

Not entirely sure what you mean.

You have to pay income tax in Korea (it's usually no more than 5%).

You should let the inland revenue know that you have left the UK. They will ask you to fill in a form and then you should get a rebate if you have overpaid for that tax year.

Snowflake · Joined: 12 Dec 2006 Location: Seoul

Tell your school that you're not liable to pay for the first two years and they'll stop deducting it. That's how it worked for me - it should be a simple process.

English Matt · Joined: 12 Oct 2008

If you work for a Public School (and it is only if you work for a Public School or University, not a hagwon, that you will be able to become tax exempt) then you will need to get a Certificate of Residency from the UK in order to qualify for the 2 year 'tax-free' status. However, the whole point of the double taxation treaty thing is to stop you being taxed on your earnings in both countries. So stopping Korean income tax from being applied to your earnings (which is really tiny; less than 5%, more in the region of 1 - 2%) is not the smartest of ideas as you will then be liable to UK income tax (at the rate of 17%) being applied to any earnings you decide to repatriate to the UK.

In practice, as long as you do not declare that you repatriated your earnings then Inland Revenue shouldn't go after you for 'their slice' of the money. However, I'd rather be in the position of being able to show HMRC that I have already paid tax once on the earnings should it ever come to light that I brought the money back with me to the UK.

My school didn't seem to be able to comprehend this and in the end I was made to apply for the Certificate of Residence and am now not being taxed in Korea. This has made no appreciable difference to my earnings, for the reason as mentioned - Korean income tax is applied at a very, very low rate. I have, however, PMed you with details of how to go about getting the Certificate of Residence if you should still choose to.