📅 2025-01-02
13th month bonus through year-end tax settlement! Complete guide to all strategies and deduction items for maximum refund.
Year-end tax settlement compares withheld tax throughout the year with actual tax owed and settles the difference. Companies process it every January-February. Get refund if withheld more, pay additional if withheld less. Mandatory for wage earners. Maximize refund with accurate deduction claims.
Self deduction: 1.5M KRW (all workers). Spouse deduction: 1.5M KRW if annual income ≤1M KRW. Dependent family deduction: Direct ascendants (age ≥60), direct descendants (age ≤20) each 1.5M KRW. Siblings (age ≤20 or ≥60) 1.5M KRW. Disabled person deduction: Additional 2M KRW regardless of age. Senior citizen deduction: Additional 1M KRW if age ≥70. Single parent deduction: Additional 1M KRW.
Deduct certain percentage of spending exceeding 25% of total salary. Credit card 15%, debit card·cash receipt 30%, traditional market·public transport 40%. Deduction limit: 3M KRW if total salary ≤70M, 2.5M KRW if ≤120M, 2M KRW if exceeded. Strategy: Use credit card early year, switch to debit·cash receipt after exceeding 25%. Focus on traditional market·public transport from July.
Insurance: Full deduction for health·employment insurance. Guaranteed insurance premium 1M KRW annual limit. Medical expenses: Deduct amount exceeding 3% of total salary (no limit). Infertility treatment 30%, excluding cosmetic surgery. Education expenses: Full for self, 3M KRW for preschool children, 3M KRW for elementary-high school, 9M KRW for college. Full deduction for disabled special education.
Pension savings: 4M KRW limit (6M KRW if total salary ≤55M), 13.2% tax credit (including local tax). IRP: 7M KRW limit (combined with pension savings), 13.2-16.5% tax credit. Housing subscription savings: 2.4M KRW limit, 40% deduction. Housing mortgage interest: 3-18M KRW limit. Jeonse loan principal·interest: 3-4M KRW limit.
① Prepare deduction receipts from October. ② Pre-check simplified data on Hometax. ③ Use National Tax Service simulation before company submission. ④ Beware duplicate dependent deductions (between siblings). ⑤ Carefully collect medical·education receipts. ⑥ Fill pension account limits. ⑦ Confirm housing fund deduction requirements. ⑧ Submit donation receipts. ⑨ Monthly rent tax credit (7.5M KRW limit).
Year-end tax settlement is all about preparation. Maximize refund by collecting all deduction items and spending strategically. Make sure to get your 13th month bonus this year!