Korean Stock Trading Tax Calculator

Selling shares in Korea triggers more than one tax. Listed Korean shares carry a securities transaction tax and a rural special tax on the sale proceeds, overseas shares are taxed on the year's net capital gain, and dividends are withheld at source the moment they are paid. This calculator shows all three separately on one screen. For a domestic sale, choose the market and enter the sale and purchase amounts to see the tax and your after-tax result; for overseas shares enter the annual gain, and for dividends the annual total.

The point that catches most people is that the domestic tax is charged on the whole sale amount, not on profit. Sell ₩10 million of KOSPI shares and 0.2% goes out regardless of whether you made money. Buy at ₩9 million and sell at ₩10 million and you keep ₩980,000 of the ₩1 million gain; buy at ₩11 million and sell at ₩10 million and you lose ₩1 million and still pay ₩20,000 on top.

Anyone about to sell shares who wants to know what actually lands in their account. Frequent traders in particular should look at the numbers: 0.2% on every sale adds up over a year, and multiplying the rate by the number of trades shows quickly how much churn costs.

It also matters for anyone who has sold overseas shares for the first time. Unlike listed Korean shares, overseas shares are taxed whether or not you are a large shareholder, and the broker does not withhold the tax for you. You must file yourself in May of the following year, and missing the filing brings penalty tax. Knowing the rough figure in advance removes the surprise.

The domestic sale tax comes from 증권거래세법 제8조, which sets the base rate, and 같은 법 시행령 제5조, which sets the flexible rate for each market. KOSPI carries a 0.05% transaction tax plus a 0.15% rural special tax under 농어촌특별세법 제5조제1항제5호, 0.2% in total; KOSDAQ carries the transaction tax alone at 0.2%. Unlisted and over-the-counter trades get the base rate of 0.35% with no reduction. The calculation is simply the sale amount multiplied by that market's rate. The purchase amount does not affect the tax at all and is only used to show your profit or loss.

For overseas shares, all gains in the year are added up, losing positions are netted off, an annual allowance of ₩2.5 million is deducted, and the remainder is taxed at 20% income tax plus 2% local income tax, 22% in total. Dividends are withheld at 14% income tax plus 1.4% local income tax, 15.4% in total, when they are paid.

Suppose you bought KOSPI shares for ₩9 million and sold them for ₩10 million. On the ₩10 million sale, the 0.05% transaction tax is ₩5,000 and the 0.15% rural special tax is ₩15,000, so the tax is ₩20,000. Taking that off the ₩1 million gain leaves ₩980,000 after tax. The same trade on KOSDAQ would give the same ₩20,000, but as a single 0.2% transaction tax.

If you made a ₩5 million net gain on overseas shares in a year, the ₩2.5 million allowance comes off first, leaving a taxable base of ₩2.5 million, and 22% of that is ₩550,000 to file and pay the following May. A gain at or below the allowance means no tax, but the filing obligation remains.

The most common one is assuming that a loss means no tax. The securities transaction tax is charged on the sale amount regardless of profit, so it goes out on losing trades too. The next most common is leaving losing overseas positions out of the calculation. Gains and losses on positions sold in the same year are netted against each other, so including the losers lowers the tax. Losses do not carry over into the next year.

Anyone receiving dividends from several sources should check whether interest and dividends together exceed ₩20 million a year. Above that line they fall into comprehensive financial income taxation and are recomputed with your other income at progressive rates, so 15.4% is no longer the end of the story. Capital gains tax on listed Korean shares applies only to large shareholders and the tests are involved, so it is not covered here; if your holding is sizeable, check separately.