Korean Job Discussion Forums

[ontheway]

Well not exactly.

In the interest of accuracy for anyone who cares, the pension tax in Korea is not a straight 9% (4.5% for the worker and 4.5% for the employer). It is actually based on brackets. If your contract says that you pay 4.5% and your employer deducts 4.5% you could be paying slightly too much or too little.

The system is actually based on brackets. For example, if your monthly income falls between 1,710,000 and 1,810,000 the combined tax is 158,400. Your half is 79,200. The 9% is based on the midpoint of the range (1,760,000 x 9% = 158,400).

The pension website should have a list of brackets and the proper tax. So, when you write your contract, you should not have percentages nor actual amounts in it. It should be based on the Korean tax, pension insurance etc. law. You can only get exact amounts based on your actual pay, and all of the tax, pension, and insurance rates are subject to change.

[Grotto]

links?

[jacl]

I noticed that too.

On my base salary of 2.2 million, my pension payment was 98,550. Not quite 4.5%. Now that my base salary is 2.3, I pay 103,500. Exactly 4.5%. I saw the table, but I'm not sure if my boss is deducting on the new salary correctly.

[ontheway]

Yes, I noticed how the actual bills from the Pension Office didn't quite match the withholding at exactly 4.5%. So we called them. They said it's on their website.


For 2.3 million you are now the "midpoint" or calculation point. For the range 2,245,000 to 2,360,000 the total tax is 207,000. That would be 9% based on the 2.3 million. So, your 50% share is 103,500. Correct. Seems your boss is doing OK.


Nothing is simple in Korea. 4.5% is still a good approximation, but it's not exact. You should be within a couple thousand won of the exact amount if you use 4.5% to check your pension. Your boss is required to pay the billed amount, not the withheld amount. You should be paying half of the billed amount.


Sorry, I have no links here. We checked with the pension tax billing office by phone.

By the way, I've noticed that some of the insurance bills don't work out exactly either. We just deduct exactly half of the invoice from the teachers' pay, but perhaps 2.24% isn't the rule either. Could there be brackets or some other factors? More questions to ask. People hate me when I ask questions. Wish I wasn't so curious.

[ontheway]

2.2 million. Bracket calculation point 2,190,000 x 0.09 = 197,100. Your 50% = 98,550.

Now, where's that site?

[jacl]

I pay 51,070 on 2.3 million for health insurance. My boss had the list for income tax, health, and pension. I only saw it briefly.

[ontheway]

Your health insurance seems to be 450 won low. That looks like a division error. Does you boss use a calculator?

[jacl]

[ontheway]

Pension bills are monthly. He just didn't tell them about your raise - yet.

Insurance bills are quarterly (Actually 3 separate invoices for three months billed and paid simultaneously. Big waste of paper.), and you get nothing back so a notification of raise only costs you more.

This complexity also explains the "Korean way" of paying overtime.

[jacl]

I only started paying health this year. I think the figures are actually correct. I could ask to see that sheet again. He has an all inclusive thingy with deductions (health, pension, income tax) for all the salary brackets. Looked spot on. No qualms there with the health. Like, I said, it's probably a bracket thing with health as it is with pension. I would just like to make a phone call to the health office to find out for sure how much has been paid. I'm skeptical. With the new mandatory thing, my health payments had to start from January 1st. At first, he was only deducting 1/2 of 2.24%. I told him that he was under-deducting me (made me look honest when actually I'm quite evil - you know? keep 'em at bay sort of thing). I'm just wondering about it and just a little on the doubting side. The booklet and all looks legit, but he could have had that made up by his friend at the hospital (probably not). Or he could just be paying a little at first (or none at all) and waiting until the last possible moment to pay the health office or something. Also, it seems I'm paying for the previous month and not before the month starts. And him under-deducting me at first just doesn't seem right. Also, he started deducting from my co-worker from South Africa at the same time and she never got the booklet. She only recently asked him about this. He was doing the old "wait until my back's against the wall" deal with her. They're always up to something here. What a headache! Anyway, she doesn't pay pension. He could be worried about that. Maybe. Of course, if he can losing 50,000 month, he'll try. Both of them wouldn't want the pension.

My salary increase started with my new contract at the begining of March. So the figures could be screwed up with that. Maybe. But I doubt it. I'm only concerned about whether he's making regular full payments for my health and I want to get that extra 9,900 Won a month sent to the pension office.

Taxes on overtime? God forbid. He wants to pay those as much as I do.

[Real Reality]

[denverdeath]

[ontheway]

Real Reality,

Thanks for the tables. Number 4 for pension.


Denverdeath,

You're right. I just wanted everyone to know that when the numbers look a little off, they could be the correct legal amounts. And that we teachers could make ourselves look really foolish demanding that the school follow some exact formula that we've seen posted on Dave's which turns out is not exactly correct.

If your pension or health insurance are not exactly the 4.5% or 2.24% we expect, they could be correct. It helps to have the above table with the brackets for pension. I still have questions about the health insurance rates.