For ordinary personal contributions, cap pension savings at KRW 6 million, add eligible retirement-account contributions and cap the total at KRW 9 million before applying the credit rate.
Scope and contribution limits
This reference concerns a Korean resident employee with employment income only. If you also have business or other income, check the comprehensive-income test rather than deciding the rate from salary alone. Figures below concern national income tax and exclude local income tax effects. They are not personal tax or investment advice.
| Category | Ordinary annual eligible amount |
|---|---|
| Pension savings | Up to KRW 6 million |
| Pension savings plus eligible retirement accounts, including IRP | Up to KRW 9 million combined; the pension-savings sublimit still applies |
| Employment income only: gross salary up to KRW 55 million | 15% credit rate |
| Employment income only: gross salary above KRW 55 million | 12% credit rate |
Ordinary credit = min(min(eligible personal pension savings, KRW 6m) + eligible personal retirement contributions, KRW 9m) × credit rate
Match the records before calculating
| Record | Check | Keep separate |
|---|---|---|
| Annual contribution certificate | Eligible personal contributions for this tax year | Account balance and investment returns |
| DC or IRP contribution history | Your additional personal contributions | Employer contributions and transferred retirement benefits |
| Employment withholding statement | Gross salary, final tax and tax already withheld | Contract salary and take-home pay |
| ISA maturity-transfer confirmation | Transferred amount and tax year | Ordinary contributions and the additional limit |
A KRW 9 million account balance does not establish KRW 9 million of eligible contributions. Confirm the year, source of funds and contribution classification with the institution.
Compare the same total contribution
| Hypothetical personal contributions | Eligible amount | National credit at 15% |
|---|---|---|
| Pension savings KRW 9m; IRP zero | KRW 6m | KRW 900,000 |
| Pension savings KRW 6m; IRP KRW 3m | KRW 9m | KRW 1,350,000 |
| Pension savings KRW 3m; IRP KRW 6m | KRW 9m | KRW 1,350,000 |
Example · Gross salary KRW 70m, pension savings only KRW 8m
- Eligible amount: KRW 6m under the pension-savings limit.
- Calculated national credit: KRW 6m × 12% = KRW 720,000.
- With another KRW 3m of eligible IRP contributions: KRW 9m × 12% = KRW 1,080,000.
These are limit comparisons, not recommendations to contribute more or choose a product. Check withdrawal conditions and the cash you need for living expenses before making an additional contribution.
A calculated credit is not the cash refund
Other credits, reductions, their ordering and limits, and tax already withheld affect the final settlement. A calculated pension credit alone cannot establish your refund.
Example · Read final tax against tax already paid
- Assume final national income tax after all credits is KRW 400,000.
- If KRW 700,000 was withheld: 400,000 − 700,000 = −300,000, a KRW 300,000 refund.
- If KRW 200,000 was withheld: 400,000 − 200,000 = 200,000, an additional payment.
- The same final tax can produce a refund or an additional payment. Local income tax is separate.
Ask payroll to confirm the pension-savings and IRP personal contributions reflected in your settlement, the eligible amount and rate, final tax and tax already withheld. If the contribution certificate differs, first ask the institution how each payment was classified.
ISA maturity transfers and exclusions
A qualifying transfer of matured ISA funds to a pension account can add 10% of the transferred amount, capped at KRW 3 million, to the credit limit for the transfer year. For a KRW 30 million qualifying transfer, the additional limit is KRW 3 million, taking the ordinary KRW 9 million limit to KRW 12 million for that year. Confirm transfer eligibility and documentation with the institution.
Employer DC contributions are excluded; eligible personal additional DC contributions may qualify. A transfer between pension accounts is not automatically a new personal contribution. The ISA additional limit does not repeat in following years solely because the transferred balance remains in the account.