Korean Job Discussion Forums

austinmc86 · Joined: 23 Feb 2010

Do we have to pay pension and income taxes?

I have received two paychecks, but I have yet to pay pension or taxes... is this normal?

What is pension exactly? Do I have to pay for it.... and taxes?

I just get normal pay minus utilities.

OculisOrbis · Joined: 17 Jul 2006

Yes.
No.
I cant believe you even asked that and yes - you pay half and your employer contributes the other half. You pay the taxes.

http://www.nps.or.kr/jsppage/english/main.jsp
http://www.nhic.or.kr/portal/site/eng/
http://www.nts.go.kr/eng/

kimchi_pizza · Posted: Sun Aug 22, 2010 4:36 pm Post subject:

From my understanding, all educational institutes i.e. hogwans, public/private schools, unis, have to pay into a pension plan for their employees.
These plans are usually thru the National Pension Service (NPS) which is run by the government. You pay approximately 100,000 a month and your employer matches that. Your employer should also give you a NPS certificate. Be sure to ask for and get one. KEEP THIS.
If you don't receive one, then be suspicious. I think you have an option if you want to pay into it but I highly recommend it. Good way to save/make money(employer's matching payments) plus you earn interest on it as it sits in NPS.
Every city has a NPS center. I went to one last week to check up on my pension and everything is good. They will print out not only the total amount that is due you but they can also print out each months payment they received from your pay via your employer. It's quick and easy but they need to see that certificate. (I'm sure just a photo id will be just as fine.)

The private plan is similar, but no certificate and no matching payments(at least not my school's plan) which I will ask them about later. My school printed out the total amount payed into my pension as well as a record of each month's payment.

It's a lot of money so stay on top of it and do your own research and investigation. Don't take health insurance and pension for granted. It's a MUST HAVE.

TheUrbanMyth · Joined: 28 Jan 2003 Location: Retired

austinmc86 · Joined: 23 Feb 2010

Am I liable if I don't have taxes or pension taken from my paycheck?

OculisOrbis · Joined: 17 Jul 2006

sugarloaf82 · Joined: 21 Dec 2008

I am wondering about the tax rate as well. I am considering staying a third year and as an American I haven't paid taxes during my first two years, but I know I will have to if I do a third year. I just looked at the NTS website, but couldn't find an exact rate. Does anyone know what the tax rate is?

I saw one rate that was 8%, but that seemed pretty steep. An additional 200,000 coming out of my salary every month would be a big chunk of change.

Any info would be great. (I'm a GEPIK teacher if that makes any difference~~~)

Thanks.

tophatcat · Joined: 09 Aug 2006 Location: under the hat

austinmc86 · Joined: 23 Feb 2010

So I have been here around 4 months and still no pension, taxes or health insurance.

What happens if my employer does not pay into the pension and no taxes? What is the penalty?

stephencreech · Joined: 13 Apr 2010

I just received a contract and one of the lines stated:

5. Korean Tax (which includes: pension, income tax, inhabitants tax and health insurance) will be deducted from the salary according to the Korean tax law (Currently 6% - 8 %).

The salary is 2,100,000 per month... this seems to equal 168000 at 8%.

Is this in the ballpark of being right?

I figured that the pension was 100,000 on my part, income tax at 69,300 and 35,000 for insurance. Those total to 204,300 which make the 8% seem better.

What is inhabitants tax?

Thanks,
Stephen

OculisOrbis · Joined: 17 Jul 2006

income tax is on a sliding scale based on your income. their stated rated is about three to fours times what you should be paying and is not according to korean law. you should be paying about 38 000 a month in tax for your salary level.

inhabitants tax is a small additional tax and it is 10% of what you pay for income tax. if you pay 38 000 a month in income tax, you add an additional 3 800 for the inhabitants tax. inhabitants tax is normal and everyone pays it.

Your share of the national health insurance will be about 2.6% (actually a little less) and your employer matches that.

Your share of the pension is 4.5%. It should be stated in the contract along with your employer's share.

If everything were totaled up, tax/pension/health, you would be paying ~9% each month.

They need to amend that contract to separate health and pension from the taxes clause (or at least specify exactly what each deduction is going to be). Your salary is set so they know your tax rate and pension and health are straight percentages of your income - there's no reason for not specifying unless they dont plan on doing it right.