🏢 Korea Real Estate

Korea Property Taxes Explained for Foreign Investors (2026 Guide)

Korea's property tax system is one of the most important things to understand before investing — and one of the most misunderstood. The headline acquisition tax rates look manageable, but the capital gains tax rates for short-term holdings can reach 70%. Here's the complete picture.

1. Acquisition Tax (취득세) — Paid at Purchase

This is the first and largest tax you pay when buying Korean property. Rates vary by property type, value, and number of properties owned: First home under ₩600M: 1.1%. First home ₩600M–₩900M: 2.2%. First home over ₩900M: 3.5%. Second home: 8%. Third home+: 12%. Officetels (commercial): 4.6%. Paid within 60 days of purchase contract. Your judicial scrivener or tax accountant files this automatically.

2. Annual Property Tax (재산세) — Paid Twice Yearly

Assessed on the property's "official price" (공시가격) — typically 60–80% of market value. Rates: 0.1% for residential property under ₩600M official price; 0.15–0.4% for higher value properties. Paid in July and September each year. For a ₩300M official-price property, expect roughly ₩300,000–₩450,000 annually.

3. Comprehensive Real Estate Tax (종합부동산세) — High-Value Properties

Applies to properties with total official price exceeding ₩900M for one home (₩600M in regulated areas). Rates: 0.5–5% depending on value and number of properties. This is the "mansion tax" that primarily affects premium Gangnam apartments. Most first-time foreign buyers won't encounter this initially.

4. Capital Gains Tax (양도소득세) — At Sale

This is where Korea's tax system becomes most punishing — and why the government's anti-speculation measures are effective. Holding under 1 year: 70% of profit. Holding 1–2 years: 60% of profit. Holding 2+ years (primary residence, lived in 2 years): Progressive 6–45% based on profit amount. For investment properties (not primary residence): 6–45% progressive rates after 2+ years. The 2-year hold minimum for normal CGT rates aligns with the foreign buyer residency requirement — by design.

5. Rental Income Tax

Rental income under ₩20M/year: Taxed at a flat 14% rate. Rental income over ₩20M/year: Combined with global income, taxed at progressive 6–45% rates. Rental income must be reported annually to the Korean tax authority (NTS). Foreign investors must report Korean rental income in their home country as well — check your country's tax treaty with Korea to avoid double taxation.

6. Tax Treaty Benefits

Korea has tax treaties with 90+ countries. Most treaties prevent double taxation on Korean property income and gains. The treaty typically allocates taxation rights to the country where the property is located (Korea) for real estate income and gains — meaning you pay Korean taxes first, then claim a foreign tax credit in your home country. Consult a tax professional familiar with Korea-specific treaties.

⚖️ For informational purposes only. Always consult a licensed Korean attorney before making investment decisions.