Util Monster
Free
※ Based on 2026
Automatically calculates 10% Value Added Tax (VAT) and withholding tax (3.3%, 8.8%) for freelancers and sole proprietors. Useful for tax filing and contract preparation.
This calculator is based on South Korean tax law
Value Added Tax is an indirect tax levied on the value added in transactions of goods and services. Korea has applied a single rate of 10% since 1977, calculated by multiplying the supply price by 10%. For example, a product worth 1 million KRW is sold for 1.1 million KRW including 100,000 KRW VAT.
VAT-inclusive calculation is obtained by supply price × 1.1, and VAT-exclusive calculation is calculated by total consideration ÷ 1.1. Excluding VAT from 1.1 million KRW yields a supply price of 1 million KRW and VAT of 100,000 KRW. Such calculations are essential when preparing quotations, issuing tax invoices, and drafting contracts.
Withholding tax is a system where tax is deducted in advance when paying income. Business income is 3.3% (income tax 3% + resident tax 0.3%), other income is 8.8% (income tax 8% + resident tax 0.8%). For a freelance service fee of 2 million KRW, the actual payment is 1,934,000 KRW after deducting 66,000 KRW in withholding tax.
A simplified taxpayer is a small individual business with prior-year total consideration under 104 million KRW, taxed at an industry value-added rate (15-40%) times 10%, with only a 0.5% purchase-consideration credit instead of full input-tax deduction (per the 2021 reform). All other businesses are general taxpayers, taxed at a flat 10% with full input tax deduction. For example, a restaurant (15% value-added rate) simplified taxpayer with 50 million KRW consideration and 30 million KRW in purchases pays (50M × 15% × 10%) - (30M × 0.5%) = 750,000 - 150,000 = 600,000 KRW. A general taxpayer under the same numbers would pay (50M - 30M) × 10% = 2,000,000 KRW, so simplified status is usually cheaper. However, businesses with a high purchase ratio (wholesale, manufacturing) may fare better as general taxpayers. Simplified taxpayers generally cannot issue tax invoices, and payment is waived entirely below 48 million KRW in prior-year consideration.
General taxpayers must issue electronic tax invoices by the 10th of the month following the supply date. Tax invoices must include supplier and recipient information, supply price, VAT amount, and issue date. Failure to issue results in an additional tax of 1-2% of the supply price. Issuance is possible through Hometax or ASP.
VAT is filed twice a year. First period final return (January-June) is due by July 25, and second period final return (July-December) is due by January 25 of the following year. The amount obtained by subtracting input tax from output tax is paid, and simplified taxpayers file once a year (in January). Electronic filing is available through Hometax.
The "Filing Tax Payable" tab estimates the amount due (or refundable) at actual VAT filing time. For general taxpayers, payable = output tax (sales supply price × 10%) - input tax (purchase supply price × 10%) - tax already paid. For simplified taxpayers, payable = total consideration × industry value-added rate × 10%, minus a purchase tax credit (purchase consideration × 0.5%). Industry value-added rates are 15% for retail/restaurants, 20% for manufacturing, 25% for lodging, 30% for construction/transportation, and 40% for real-estate leasing/financial services. For example, a restaurant simplified taxpayer with 50 million KRW consideration and no purchases owes 50M × 15% × 10% = 750,000 KRW. Payment is waived below 48 million KRW in consideration (a filing is still required), and the business converts to general-taxpayer status at 104 million KRW or more. Individual businesses mainly serving consumers (not corporations, prior-year supply price 1 billion KRW or less) can also claim an extra 1.3% credit (capped at 10 million KRW/year) on credit-card and cash-receipt sales.