Korean Hometown Love & Political Donation Credit Calculator

Hometown love donations and political donations get their tax credit under separate provisions from ordinary charitable giving. Both share one structure: the first ₩100,000 you give comes straight off your tax, and anything above that is credited at a lower rate that changes by band. Pick the kind of donation, enter the amount, and this calculator shows the credit in each band, the real fall in tax once local income tax is included, and for a hometown love donation the value of the gift you receive and how much of your money comes back overall.

The statute describes the rate on the first ₩100,000 as 100/110. Dividing by 110 rather than 100 is deliberate. When an income tax credit reduces your income tax, the local income tax charged at 10% of it falls as well. Take ₩90,909 off the income tax and ₩9,091 of local income tax follows, for exactly ₩100,000 in total. The calculator keeps those two layers apart, showing the tax credit and the actual reduction in tax as separate figures.

Anyone deciding how much to put into a hometown love donation ahead of year-end settlement or the May income tax return. A hometown love donation cuts your tax and also brings a regional speciality gift worth 30% of the amount given, so up to ₩100,000 the whole donation comes back and the gift is pure surplus. Whether to give more than that depends on how far the credit rate drops, and the calculator lays that out band by band.

It also serves anyone who has given to a political party, a support association or the election commission. Political donations come with no gift, so only the tax coming back is counted. The first ₩100,000 is credited at the same 100/110 as a hometown love donation, but the bands above that are different. The two credits are computed independently, so if you made both kinds of donation in one year, run the calculator once for each.

Hometown love donations rest on 조세특례제한법 제58조제1항 and political donations on 같은 법 제76조제1항. The calculation slices the donation into bands, multiplies each band by its rate and adds the results. For a hometown love donation the first ₩100,000 is credited at 100/110, the portion above that up to ₩200,000 at 40%, and everything above ₩200,000 at 15%. If the recipient is a local authority in a declared special disaster zone, the rate on the top band rises to 30%. The annual cap is ₩20,000,000; amounts beyond it earn neither a credit nor a gift.

For a political donation the first ₩100,000 is credited at 100/110, the portion above that up to ₩30,000,000 at 15%, and anything above that at 25%. The band amounts summed give the tax credit; adding the 10% local income tax reduction gives the actual fall in tax. For hometown love donations the calculator then adds 30% of the donation as the gift value to arrive at the return rate. A credit can never exceed the tax computed for the year, so if you owe less than the credit, the surplus simply lapses.

Suppose you give ₩100,000 as a hometown love donation. The whole amount sits in the first band, so the tax credit is ₩90,909, and with the ₩9,091 drop in local income tax your tax falls by ₩100,000. You have your money back in full, and the ₩30,000 gift on top leaves you ₩30,000 ahead: a return rate of 130%.

Give ₩500,000 to the same scheme and the picture changes. The first band yields ₩90,909; the next ₩100,000, credited at 40%, yields ₩40,000; and the remaining ₩300,000 at 15% yields ₩45,000, so the credit is ₩175,909. With local income tax the reduction is ₩193,500, and the gift is worth ₩150,000, so ₩343,500 comes back on ₩500,000 given: a return rate of 68.7%. A political donation of ₩500,000 earns ₩90,909 plus 15% of the ₩400,000 above the line, ₩60,000, for a credit of ₩150,909; including local income tax the reduction is ₩166,000, a return rate of 33.2%.

The most common one is assuming that everything above ₩100,000 also comes back in full. As the ₩500,000 example shows, the credit rate drops sharply the moment you cross that line. If getting the money back is the point, ₩100,000 is where the scheme works best; anything beyond is a genuine donation. The next most common is expecting a refund when there is little or no tax to offset. A tax credit only reduces the tax computed, so if you owe less than ₩100,000, only that much is credited and the difference is never paid out in cash.

A hometown love donation cannot go to the local authority where you are registered as a resident; people sometimes try to give locally and find the donation is refused outright. Sole traders treat the portion above ₩100,000 as a deductible expense rather than a credit, so their result differs from what this calculator shows. Political donations cannot be made by foreign nationals, and the calculator checks amounts only, not eligibility, so confirm that separately.