South Korea's headline corporate income tax (CIT) rate is 25.
The headline personal income tax (PIT) rate is 45.
The standard VAT/GST (or equivalent consumption tax) rate is 10. Registration thresholds, zero-rated and exempt categories, and reduced rates vary by jurisdiction - see the source link below for the full detail on this jurisdiction.
Under Article 1-2 of the Income Tax Act, an individual is a Korean tax resident if they either have a domicile in Korea (their domestic "base of living" - center of family, occupation, and personal ties) or maintain a place of residence in Korea for 183 days or more in a tax year. Effective from 2026, the 183-day threshold applies on a rolling basis rather than strictly per calendar year, closing a prior gap that let individuals split stays across two years to avoid residency. Residents are taxed on worldwide income (with a limited exemption for foreign-source income of newly resident foreign nationals during their first five years); non-residents are taxed only on Korea-source income.
A Korean resident (individual or corporation) holding 10% or more of a foreign corporation, directly or indirectly, is subject to CFC taxation where the foreign entity's average effective tax rate over the preceding three years is 70% or less of Korea's top statutory corporate rate (a threshold of approximately 16.8%, given Korea's 24% top CIT rate). Where triggered, the CFC's undistributed earnings are deemed distributed and included in the Korean shareholder's taxable income in the tax year containing the 60th day after the CFC's fiscal year-end. The regime does not apply to a foreign branch of a Korean corporation.
Korea applies two layered interest restrictions. The thin capitalization rule denies deduction of interest on debt from a foreign controlling shareholder (or third-party debt it guarantees) once the debt-to-equity ratio exceeds 2:1 (6:1 for regulated financial institutions); excess interest is recharacterized as a dividend subject to withholding tax. Separately, since 2019 (implementing OECD BEPS Action 4), net interest paid to foreign related parties exceeding 30% of adjusted taxable income (EBITDA-equivalent) is non-deductible - where both rules could apply, the lower deduction cap governs.
Korea maintains income tax treaties with 97 countries as of January 2026 per PwC. Korea has also concluded standalone tax information exchange agreements (TIEAs) with a number of low-tax jurisdictions, including Andorra, Bermuda, the British Virgin Islands, and the Cook Islands. Starting in 2026, Korean withholding agents face stricter documentation requirements before applying a reduced treaty withholding rate, including a current certificate of tax residence from the recipient's home tax authority.