Korean Job Discussion Forums

loki · Joined: 09 Feb 2003 Location: Mokpo

My director has been deducting 3% taxes for the duration of my contract. Now that there are only two weeks to go until I go home they have decided that they haven't been deducting enough taxes.

(actually this is retribution for asking them to pay me for things that are stated in the contract which they do not want to pay (sick time pay out))

They are telling me that they will retroactively (12 months taxes) deduct 7% taxes from my severance bonus. This totals about 1.4 million won!!

Any advice would be appreciated including the name of a good lawyer!!

Can they do this? Taxes were not stated in my contract so I can't see anything that stops them....

Thanks for any help!!

Captain Obvious 2.0 · Joined: 09 Jan 2003

Would this be a bad time to point out that you have to pay taxes on your income in Korea? So, yes, what they are doing is legal.

Depending on what your income was, that will affect your tax rate. So if you're really concerned they are taking too much off you can ask to see what the tax rate should be. But I can tell you right now that at 3% deductions, that was too low.

kimcheeking · Guest

Sounds like my first employer.... They claimed to be taking taxes off but we later found out that they pocketed it.

visviva · Joined: 03 Feb 2003 Location: Daegu

It's quite likely that your director is screwing you, but it's possible that he isn't... The site below (cut and pasted from the Q&A forum, contributed by good ol' Lost Seoul) should help you figure it out:

loki · Joined: 09 Feb 2003 Location: Mokpo

according to that web site i have been paying the correct amount of taxes throughout the year. exactly the right amount. 2mil = 46,670 per month.
This is exactly the amount that they have been deducting all through the year.

Thank you.

Now I just need to know exactly what I can do about the last minute gouging. I have some ideas but any suggestions would be fantastic!!

Regards
Eric

hellofaniceguy · Joined: 10 Jan 2003 Location: On your computer screen!

How did you arrive at the figure that you did? The tax rate, what I was told by the tax office is 3.5%. I suggest that you visit the tax office and ask them for the exact rate in writing and give that to the school. The NTS (tax office) is located in all cities in korea.

loki · Joined: 09 Feb 2003 Location: Mokpo

I arived at that figure by punching it into the link that was posted earlier. This is a link to the Korean national tax service (or something like that).

The amount that came up was exactly the same amount that they have been deducting from my pay for the entire time that I have been here.

My director states that she has been deducting 2.03% during this time.

I suspect that both you and the tax service are correct. However what your figure probably includes is the pension amount. Korean Pension is required to be deducted by employers but often it is not in smaller hogwons. I read this somewhere else here at Dave's. So it is entirely possible that 3.5% is the minimum. Now if I only had an idea of what the pension deduction should be I might have an argument. I'm going to look into it tonight.

I spoke to her today (I handed her a copy of the tax service web site) and she says that there are other things like my apartment which are not included in that figure. SHe is not offering much of an explanation beyond that.

In fact, I know that the tax rate for the teacher replacing me is 5%. I am certain that she is using 7% as some form of monetary punishment. Our relationship prior to this was civil but occasionally quite frosty. Now....