Korean Job Discussion Forums

[zappadelta]

Do you pay taxes? I heard your first two years in the public school system you do not have to have taxes taken out of your paycheck. Is this true? Any information about this would be helpful.

[pet lover]

Do you mean teachers teaching in America or teachers teaching in Korea? Teachers teaching in America most certainly do pay taxes...enough to make you cry when you get your first paycheck.

[zappadelta]

Sorry, good question. I mean American public school teachers working in Korea.

[Hater Depot]

I worked at a public middle school in Korea (and I'm American). I was exempted from the national income tax but paid everything else. As far as I know under the present rules that holds for however you stay in the system.

[sarahsarah]

I pay taxes...Korean taxes.

[mack the knife]

Americans have a 2 year exemption from Korean taxes. Of course, you still pay pension and other stuff (lunch, medical, etc.)

[zappadelta]

I guess my real question is that 2 years in the public school system, or two years from when you get to Korea. I worked 2 years in hagwons and I have been working at the public school since this March.

[BigBlackEquus]

Ah, the misinformation on this board.

First of all, if anyone has a serious question about taxes, you need to research the answer yourself. Do not rely on a bunch of expats from a variety of other countries to quote US tax law which theyve heard 3rd hand via website.

Americans pay 3.3% Korean tax, just like everyone else. No more after 2 years. I believe the exemption from US taxes on the money you make here was just raised. You can make 85,000 a year, or less, and be perfectly tax-free on the wages you earn here, but you still must file your US taxes.

Public or Private hagwon or school; it doesnt matter. The taxes should be the same. If anyone is charging you above 3.3%, youre being charged too much.

[deessell]

I am a New Zealander and work in a Public School and I am exempt from paying Income tax. I got the form from the local immigration office. This is valid for two years.

[ontheway]

There are programs in Korea that exempt American teachers from paying Korean income taxes for two years (EPIK I think). Having been in Korea already could, but probably won't, disqualify you from participation on a tax free basis.

As for the tax rate foreign teachers should be paying, it is NOT 3.3 % or any such number posted here. Korea has a progressive income tax. The rates increase as your income level rises. Your actual tax rate and the correct amount of withholding will depend on your actual income level, deductions etc. For teachers presently it could easily fall anywhere between 2% and 10%. Your withholding should be adjusted accordingly. To find out your tax rate you should check this web site:

http://www.nts.go.kr/eng/default.html

They have a sample tax return which you can use to calculate your actual tax as of 2004 (I think). This will be good enough to determine how much withholding you should have, or if your actual withholding is too high or too low. I did the computation for a single hogwan worker making 2.1 million, plus year end bonus, who is exempt from the pension tax (and yes you can be exempt from paying the Korean pension.). This worker will pay 3.5% Korean income tax and zero American income tax. (Assuming the worker has no other outside income. The NTS has an example on their website of a university teacher with a family with a much higher income, some outside earnings and many deductions paying 10% Korean income tax.

For those of you who have earned money in other places or who have outside income, the Korean income tax is a GLOBAL tax. You have to (legally) report and pay tax on all of your earnings from everywhere (however, there are many deductions and exemptions so this will be irrelevant to most of us).

You can also check out: http://www.efl-law.com/tax.html

And if anyone tells you they are an expert on US taxes be warned that there is no one alive today who "knows" the US tax code - including the IRS. The IRS regularly has an error rate above 50% in audits of their advice to taxpayers. It takes teams of people and negotiations to resolve many tax issues - because nobody understands the law.

Teaching is much easier and more fun than accounting.

[mack the knife]

[BigBlackEquus]

Mack, you are welcome to quote me and take issue with what I say, but please include the whole quote within its context.

You left out the immediate line following it, which said: No more after 2 years.

Apparently, you missed the context I was speaking in. I was discussing the percentage of tax you pay when you do pay tax, which is after 2 years. It is 3.3 percent for nearly all teachers out there working legally for a hagwon. Not very many of us make much over 2.2 million won plus housing a month at a hagwon. There are a few exceptions, but I will bet you those few have been here a while and are well aware of the tax structure. . That is a very small amount after one year, all things considered.

I repeat that this board is hardly a solid source for information such as this. It is a source for finding the proper people you can talk to, however it is best to the people whose job it is to provide such information.

No need to be confrontational, Mack. Were all adults here.

[SPINOZA]

I'm British and have been in Korea 3 weeks.

My literature from my employers says that I need to present a "residence cert". Well...such a thing doesn't exist in the UK of GB so I've brought my birth certificate, which certifies (obviously) that I was born in GB and this, together with my passport and the fact that I'm very obviously a British citizen as I've been hired as a native speaker, ought to be sufficient.

So I get this done at Immigration - is that right?

cheers.