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fighton
Joined: 27 Jan 2009
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 Posted: Mon Oct 12, 2009 12:27 am Post subject: Question about pension |
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| I'm sure it's been discussed before, but how much of my paycheck (percentage) should be going to my pension every month? I work at a private school, if that makes a difference. Thanks in advance. |
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big_fella1
Joined: 08 Dec 2005
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| Posted: Mon Oct 12, 2009 12:43 am Post subject: Re: Question about pension |
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| fighton wrote: |
| I'm sure it's been discussed before, but how much of my paycheck (percentage) should be going to my pension every month? I work at a private school, if that makes a difference. Thanks in advance. |
The pension rate contributed by both the employer and employee is 4.5% of the standard monthly income. (Article 88 section 2 National Pension Act English version)
The debate comes in the form of standard monthly income, this doesn't include overtime, or tax free income. The debate is foreigners get a 30% tax break so some Hagwons calculate it as 4.5% of 70% of your standard income. I do not believe this is correct however as that 30% is not tax free, it is a deduction allowed to the employee for being foreign.
The correct amount is 4.5% by you and your employer. But they may make it 3.15% (being 70% of 4.5%). |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Mon Oct 12, 2009 8:01 am Post subject: Re: Question about pension |
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| fighton wrote: |
| I'm sure it's been discussed before, but how much of my paycheck (percentage) should be going to my pension every month? I work at a private school, if that makes a difference. Thanks in advance. |
You should be aware that the percentage is 4.5% based on the midpoint of the bracket in which your salary falls. So, your actual percentage could deviate slightly from 4.5% and still be the correct amount. Once you have been enrolled, your pension is a fixed monthly payment and does not change up or down even if you have overtime or some pay reduction. The pension office is very reluctant to change the fixed withholding rate even if you get a permanent raise - too much paperwork for them. |
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Gillian57
Joined: 14 Oct 2008
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| Posted: Mon Oct 12, 2009 3:14 pm Post subject: |
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My school was calculating my pension based on my taxable income, i.e. 70% of my gross. I checked with the pension office and sure enough, the pension website has been changed to say "4.5% of your taxable income."
Needless to say, I was not happy. |
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