Korean Day Labour & Part-Time Tax Calculator

This calculator works out how much tax the employer holds back from a daily wage in Korea. Enter the daily rate and the number of days worked and you get the total paid, the income tax and local income tax withheld, and the amount that actually reaches your bank account. It also shows what would have been taken from the same money if it had been paid as freelance business income instead, so you can check which of the two methods your pay slip was worked out under.

What it covers is withholding, meaning the tax the payer deducts on behalf of the state. For a day labourer that withholding is the whole story: there is no year-end settlement and nothing is added to a later return, so the figure here is the final tax for that income. Social insurance contributions are not tax and are worked out separately, so they are not included in the result.

It is for anyone paid by the day, whether on a construction site, in a logistics warehouse, at an event, or on a short part-time job, who wants to know what will be left after tax before the money arrives. It is equally useful after the pay slip lands, to check whether the deduction shown is right. If your daily wage is at or below ₩150,000 and tax has been taken off, something has gone wrong.

Employers use it too. A small business paying day labourers has to compute each day's withholding, hold it back and pay it over the following month. When several days are paid in one go, running the figures here confirms that the deduction has been applied per day rather than once. It also helps when an employer is unsure whether a worker should be treated as day labour or as a freelancer, because the two results sit side by side.

The tax on a day labourer is set by 소득세법 in three steps. First, 제47조제2항 grants an earned income deduction of ₩150,000 for each day worked. The daily wage minus that deduction is the day's taxable base, and a wage at or below the deduction leaves a base of zero and therefore no tax. Second, the proviso to 제129조제1항제4호 sets the withholding rate at 6%. Third, 제59조제3항 gives back 55% of that tax as an earned income tax credit. Taking 55% off a 6% rate leaves an effective 2.6999999999999997% on the excess over the deduction.

Local income tax is then added at 10% of the income tax. There is also a de minimis rule in 제86조제1호: where a single day's withholding comes to less than ₩1,000, nothing is collected at all. The test is applied to the day's income tax, and if that is treated as zero the local tax is zero as well. The order matters: the day's figure is calculated first and then multiplied by the number of days. Because the deduction attaches to every day, subtracting it once from the total inflates the tax badly.

Freelance pay works on an entirely different footing. Under 제129조제1항제3호, business income withholding takes 3% of the whole payment with no deduction, and local income tax of 0.30000000000000004% brings it to the familiar 3.3%. That amount is tax paid in advance: it is reconciled in the May income tax return, and someone with a low income often gets part of it back. Day labour income, by contrast, is taxed separately and never reconciled, which is the biggest practical difference between the two.

Say you work ten days at ₩200,000 a day. The daily taxable base is ₩200,000 less the ₩150,000 deduction, or ₩50,000. At 6% that is ₩3,000, and after the 55% credit the day's income tax is ₩1,350. That clears the ₩1,000 de minimis line, so it is collected, with ₩135 of local income tax on top for ₩1,485 a day. Over ten days that is ₩13,500 of income tax and ₩1,350 of local tax, ₩14,850 in total, leaving ₩1,985,150 in hand from ₩2,000,000 paid. That is well under 1% of the amount paid.

Pay the same ₩200,000 ten times as freelance income and there is no deduction: 3% of the full ₩2,000,000 is ₩60,000, plus ₩6,000 of local tax, so ₩66,000 comes off and ₩1,934,000 arrives, ₩51,150 less than the day labourer keeps. Go the other way and set the daily wage at ₩180,000: the base is ₩30,000, 2.6999999999999997% of that is ₩810, which falls under the ₩1,000 line, so nothing is withheld at all.

The most common error is applying the deduction once when several days are paid together. Ten days at ₩200,000 is not ₩2,000,000 less a single ₩150,000; the deduction comes off every day and the ten daily results are added up. If the tax on your pay slip is noticeably higher than this calculator shows, the employer has probably worked it out on the total.

The second is believing you can choose between day labour and freelance treatment. The category follows how the work is actually done. If the business sets your hours and place of work and directs what you do, you are an employee, not a contractor. A day labourer who finds 3.3% deducted should raise it with the employer, and if it has already been processed that way, the excess can be recovered through the May income tax return.

The third is assuming that zero tax means no paperwork. Even when nothing is withheld, the employer still files a payment statement, and the worker is wise to keep a record of days worked and amounts received. Those records are the evidence if wages go unpaid or an unemployment or industrial accident claim is disputed. Finally, do not confuse social insurance with tax. This calculator shows tax only; depending on the number of days and the conditions of the job, employment insurance or national pension and health insurance may be deducted separately.