Glossary

The Korean property and tax terms you will meet at a bank or an agent's office, explained in English with the original Korean kept alongside.

Borrowing10

LTV (Loan to Value)LTV · 주택담보인정비율: The share of a home's price a bank may lend against it. In regulated zones it is 40% if you own no home, 0% if you already own one, and 70% for a genuine first purchase.; On a ₩800M home, 40% means ₩320M. That is only a ceiling though. The amount cap and your DSR are calculated too, and whichever is lowest wins.; Calculator →
DSR (Debt Service Ratio)DSR · 총부채원리금상환비율: Your annual repayments across every loan you hold, as a share of annual income. Banks generally stop at 40%.; On ₩50M income, 40% allows ₩20M a year, about ₩1.67M a month. Existing loans eat into that first, so a car loan today shrinks the mortgage you can get tomorrow.; Calculator →
Stress Rate스트레스 금리: An extra rate added only when calculating your DSR, to allow for future rate rises. 3.0 percentage points for mortgages in the capital region and regulated zones, 1.5 elsewhere.; You never pay a won of it. It only shrinks your limit. Borrow at 4.74% and the bank still runs the numbers at 7.74%. That gap is worth about ₩87M of borrowing capacity.; Calculator →
Absolute Loan Cap금액 상한: A hard ceiling by home price band: ₩600M up to ₩1.5B, ₩400M from ₩1.5B to ₩2.5B, ₩200M above that.; It does not taper. It drops off a cliff at each band. A home ₩10M over the ₩1.5B line loses ₩200M of borrowing capacity in one step.; Calculator →
Equal Total Payment원리금균등: The same total amount (principal plus interest) every month from start to finish.; Easy to budget for. But early payments are mostly interest, so the balance barely moves, and a balance that stays high costs more interest overall.; Calculator →
Equal Principal원금균등: The same amount of principal every month, plus interest on whatever is left.; The first months hurt more than equal-payment. In exchange the balance really falls, interest falls with it, and payments get lighter each month. On ₩500M over 30 years it saves about ₩81M in interest.; Calculator →
Grace Period거치기간: A stretch at the start where you pay interest only, no principal.; Comfortable now, expensive later. The balance does not move at all during it, so total interest rises, and when it ends the same principal has to be repaid over fewer years.; Calculator →
DTI, Debt to Income (총부채상환비율)DTI · 총부채상환비율: Annual mortgage principal and interest plus the interest only on other loans, as a share of annual income. The older standard that DSR replaced.; DSR counts principal on your other loans too, so the same borrower always shows a lower DTI than DSR. Bank limits today run on DSR, so judging your headroom by DTI will overstate what you can borrow.; Calculator →
Bullet Repayment (만기일시상환)만기일시상환: Pay interest only for the whole term and repay the entire principal at maturity. Common on credit loans and jeonse deposit loans.; The lightest monthly payment and the most total interest, because the balance never falls. If the cash to repay is not there at maturity you must extend or refinance, and by then rates and lending rules may have moved against you.; Calculator →
Fixed vs Variable Rate (고정금리·변동금리)고정금리·변동금리: A fixed rate stays the same to maturity; a variable rate resets periodically with a market benchmark. Hybrids fix for a few years then switch to variable.; Variable starts lower but your payment climbs when rates rise. Over a 30-year loan a one-point difference is tens of millions of won in interest. Watch the base rate trend, and count the early repayment fee before switching.; Calculator →

Tax36

Acquisition Tax취득세: A local tax paid when you acquire property. The familiar 1.1% or 4.6% figures already include local education tax and rural special tax on top of the base rate.; Homes run 1 to 3%, commercial 4%. The same ₩500M costs ₩5.5M as a home and ₩23M as a shop. Once the balance is paid there is no adjusting it.; Calculator →
Rural Special Tax농어촌특별세: An earmarked tax added on top of other taxes to fund rural development.; Homes of 85㎡ or less are exempt. That single line is worth about ₩10M on a ₩500M purchase. It is judged on exclusive area, not the larger supply area quoted in listings.; Calculator →
Capital Gains Surcharge양도세 중과: Extra percentage points added to the base rate when someone with several homes sells one in a regulated zone: +20 points for a second home, +30 for a third or more.; It is not only the rate. The long-term holding deduction is removed entirely, so the taxable base grows as well. It applies again to sales from 10 May 2026.; Calculator →
Long-Term Holding Deduction장기보유특별공제: A deduction against your gain for having held the property for a long time.; If the surcharge applies, this deduction disappears completely. Years of holding stop counting for anything, which is why a long hold makes the surcharge hurt more, not less.; Calculator →
Tax Base (과세표준)과세표준: The amount the tax rate is actually applied to. It is what is left after every deduction has been taken off, which is less than everything you earned.; Tax is rate times tax base, not rate times income. More deductions mean a smaller base, and if the base slips below a bracket line the rate itself drops. Two people on the same salary pay different tax because their bases differ.; Calculator →
Progressive Deduction (누진공제)누진공제: A fixed amount subtracted after you multiply the tax base by its bracket rate. It is a shortcut that gives the same answer as taxing each lower slice at its own lower rate.; On a ₩50M base you multiply by 15% and subtract ₩1.26M. The first ₩14M is effectively still taxed at 6%. Crossing into a higher bracket only raises the rate on the part above the line, so "one won over and I lose money" is a myth.; Calculator →
Income Deduction (소득공제)소득공제: An amount taken off your income before the rate is applied. Dependents, card spending and housing-subscription savings are the common ones.; What it saves depends on your bracket. A ₩1M deduction is worth ₩150K at 15% and ₩350K at 35%, so the higher your income, the more the same deduction saves. Compare a tax credit, which cuts the tax itself.; Calculator →
Tax Credit (세액공제)세액공제: An amount subtracted from the tax after it has been calculated. Monthly rent, children and pension-account contributions are the common credits.; Unlike a deduction, it cuts a fixed amount regardless of your bracket. A worker on ₩50M gross paying ₩600K monthly rent gets about ₩1.22M off. But it cannot go below zero. If you owe little tax to begin with, you cannot use the whole credit.; Calculator →
Withholding (원천징수)원천징수: The payer takes the tax out before handing you the money. Payroll income tax and the 3.3% taken from freelance fees are the everyday examples.; Withheld tax is a prepayment, not the final bill. A freelancer loses 3% plus 10% local tax on that (3.3% in all) and settles the difference in the May income tax return. The lower your income, the bigger the refund.; Calculator →
Comprehensive Income (종합소득)종합소득: Interest, dividend, business, employment, pension and other income added together per person and taxed on one progressive scale.; Income that looks lightly taxed on its own lands in a higher bracket once combined. Rental income or lecture fees on top of a salary are effectively taxed at your top marginal rate. Income that qualifies for separate taxation stays out of the pile.; Calculator →
Separate Taxation (분리과세)분리과세: Income taxed on its own at a fixed rate instead of being added to everything else. Often it is settled entirely by withholding.; Usually the better deal. Interest and dividends stay separate up to ₩20M a year, and housing rental income of ₩20M or less can choose 14% separate taxation. One won over the line and it merges into comprehensive income at your top rate, so watch the threshold.; Calculator →
Gross Pay & Employment Income (총급여·근로소득금액)총급여·근로소득금액: Gross pay is your salary minus tax-free allowances. Employment income is gross pay minus the employment income deduction. Year-end settlement starts from these two numbers.; Eligibility for the rent credit and card deduction is judged on gross pay; your rate is judged on the tax base after further deductions. Mix them up and you miss a credit you qualified for, or count on one you do not. The employment income deduction is capped at ₩20M.; Calculator →
Tax Already Paid (기납부세액)기납부세액: Tax you paid before the year-end settlement or May return: monthly payroll withholding, the 3.3% taken from freelance fees, interim payments.; Your refund is the gap between this and the final tax, not the tax itself. Final tax below what was prepaid means a refund; above means a top-up. Less withheld each month means a smaller refund or a bill. That is timing, and nothing is lost.; Calculator →
Personal Deduction (인적공제)인적공제 · 기본공제·추가공제: A deduction of ₩1.5M a year for yourself and each dependent, with extra amounts for age, disability and similar.; Each dependent cuts the tax base by ₩1.5M, which is roughly ₩220K of tax in the 15% bracket and more above it. Which family member claims a parent or child changes the household's total tax, so put dependents on the return of whoever has the higher rate.; Calculator →
Comprehensive Taxation of Financial Income (금융소득종합과세)금융소득종합과세: When interest plus dividends exceed ₩20M in a year, the excess is added to your other income and taxed on the progressive scale.; Up to ₩20M it ends with 14% withholding. Above it, the excess sits on top of salary or business income at your top rate. If you hold large deposits or dividend stocks, spreading maturities and payouts across years so you stay under the line changes the bill.; Calculator →
Deemed Rent (간주임대료)간주임대료: Rental income imputed on tenant deposits, meaning the interest you would have earned by banking them. Applies when you own three or more homes and deposits total more than ₩300M.; You can collect no rent at all and still have rental income. 60% of deposits above ₩300M is multiplied by the 3.1% deposit interest rate and counted as income. Assuming jeonse-only landlords owe nothing is how people end up under-reporting.; Calculator →
Necessary Expenses (필요경비)필요경비: Costs incurred to earn income, subtracted before tax. Business income uses actual costs; other income uses a fixed percentage.; Lecture and writing fees get 60% treated as expenses even if you spent nothing. On ₩1M received, only ₩400K is taxed. How much expense you can prove decides the tax, so receipts and books are money.; Calculator →
Bookkeeping vs Estimation (기장·추계)기장·추계: Bookkeeping means filing on real income and expenses from your books. Estimation means filing without books, using expense ratios the tax office publishes by industry.; Above an industry-specific revenue line you must keep double-entry books, and filing without them adds penalty tax. If your real costs beat the published ratio, books lower your tax; if not, estimation does. Not knowing which side you are on means you cannot even get a quote from an accountant.; Calculator →
Simplified VAT (간이과세)간이과세: A scheme letting small businesses compute VAT with a flat industry value-added ratio. The line is prior-year sales under ₩104M, or ₩48M for property rental.; Far less VAT and a simpler return than the general scheme. The trade-off: you cannot fully recover input VAT, and crossing the sales line moves you to general VAT the following year. If a big upfront investment makes refunds important, simplified can cost you.; Calculator →
Earned Income Tax Credit (근로장려금)근로장려금 · EITC: A cash payment from the state to low-income working households, sized by household type, income and assets.; It is money paid to you, not a tax cut, so people who owe no tax still qualify. Household assets of ₩240M or more disqualify you; ₩170M or more halves the payment. Nothing is paid unless you apply, so do not ignore the notice.; Calculator →
Four Social Insurances (4대보험)4대보험: National pension, health insurance (with long-term care), employment insurance and industrial accident insurance. Apart from accident cover, employer and employee split the premiums.; They leave your payslip before tax does, and take more. Pension is 9.5% split in half with the employer and capped, so high earners stop at a ceiling. Health and long-term care have a far higher ceiling and climb with every raise. Net pay is what is left after all four.; Calculator →
Average Wage & Ordinary Wage (평균임금·통상임금)평균임금·통상임금: Average wage is total pay over the three months before leaving, divided by the days in that period. Ordinary wage is the regular, uniform hourly or monthly rate.; Severance pay uses average wage; overtime, night and holiday premiums use ordinary wage. Severance is 30 days of average wage per year of service, so heavy allowances in your last three months raise it. Which wage applies decides the amount.; Calculator →
Retirement Income (퇴직소득)퇴직소득: A lump sum received on leaving a job, such as severance pay. It is taxed on its own, not with other income, and the formula lightens the tax the longer you served.; The payout is divided by years of service to get an annual figure, taxed, then multiplied back. The same ₩100M is taxed very differently after ten years than after three. Taking it into a pension account defers or lowers the tax further.; Calculator →
Pension Income (연금소득)연금소득: Income received as a pension: national pension, retirement pension, pension savings. National pension is taxed comprehensively; private pensions can elect separate taxation depending on the amount.; Private pension of ₩15M or less a year can end with a low withholding rate; above that you choose comprehensive taxation or a 15% separate rate. Withholding rates fall with age, so how much you draw each year sets the tax.; Calculator →
Gift Deduction (증여재산공제)증여재산공제: The amount of a gift that is tax-free: ₩600M from a spouse, ₩50M to an adult child, ₩20M to a minor, ₩10M from other relatives, all counted over a rolling ten years.; It is a ten-year allowance, not a per-gift one. If your child received ₩50M five years ago, the deduction today is zero. Only the excess is taxed, so spacing gifts ten years apart moves the same wealth tax-free.; Calculator →
Inheritance Deductions (상속공제)상속공제: Amounts taken off an estate before tax. You use the larger of a ₩200M basic deduction plus personal deductions, or a ₩500M lump-sum deduction, and a separate spouse deduction on top if there is a surviving spouse.; The spouse deduction is at least ₩500M and up to ₩3B, so estates with a surviving spouse are often tax-free up to ₩1B. If the spouse died first, the starting point is ₩500M. Who survives can swing the tax by hundreds of millions of won.; Calculator →
Gift with Debt Attached (부담부증여)부담부증여: A gift that transfers a debt with it, such as a tenant deposit or mortgage. The recipient pays gift tax on the value net of the debt; the giver pays capital gains tax as if the debt portion had been sold.; Less gift tax, but capital gains tax appears. On a property that has risen a lot, that gains tax can make the total higher than a plain gift. The recipient must be able to service the debt, or the whole thing is treated as a gift, so income proof matters.; Calculator →
Acquisition Tax Surcharge (취득세 중과)취득세 중과: Owners of multiple homes and corporations pay 8% or 12% acquisition tax on a home instead of the basic 1 to 3%. In a regulated zone it starts from the second home; elsewhere from the third.; On a ₩500M home the gap between the basic rate and 12% is tens of millions of won. A brief overlap while moving house can qualify as a temporary two-home case at the basic rate, so check your home count and the zone before paying the balance.; Calculator →
Comprehensive Real Estate Tax (종합부동산세)종합부동산세 · 종부세: A national tax on top of property tax, charged when the official prices of all homes you own add up past a threshold: ₩900M in general, ₩1.2B for a single-home household.; The base is the official-price total minus the deduction, times the 60% fair market ratio. One ₩1.2B home is not taxed; two ₩600M homes are. It is charged to whoever owns the property on 1 June, so selling before or buying after shifts a full year's tax.; Calculator →
Fair Market Value Ratio (공정시장가액비율)공정시장가액비율: The share of the official price used as the tax base. The statutory ratio is 60% for both housing property tax and comprehensive real estate tax.; An official price of ₩1B is taxed on ₩600M. The ratio is set by decree, not statute, so your tax can move without prices moving. When holding-tax news mentions a ratio adjustment, that is your bill.; Calculator →
Tax Burden Cap (세부담상한)세부담상한: A ceiling on how much this year's holding tax can rise over last year's. Even if official prices jump, the tax rises only to the cap.; Comprehensive real estate tax is capped at 150% of the previous year's, so it cannot more than 1.5x in one year. Property tax has caps by official-price band. A year at the cap is followed by catch-up the next, so "it was small last year" does not carry forward.; Calculator →
Official Price (공시가격 · 기준시가 · 시가표준액)공시가격 · 기준시가·시가표준액: The government's valuation of a property for tax purposes. 공시가격 is the land ministry's housing figure, 시가표준액 the local-tax name, 기준시가 the national-tax name; for homes they are generally the same number.; It is the starting point for property, comprehensive real estate and gift tax, so a rise in this number raises your tax without a sale. It usually sits below market price, which is why acquisition and capital gains tax (on actual price) and holding taxes (on official price) start from different figures for the same home. You can object during the annual review window.; Calculator →
Single-Home Exemption (1세대 1주택 비과세)1세대 1주택 비과세: No capital gains tax when a household sells its only home after holding it two years or more. Homes bought in a regulated zone also need two years of residence, and the portion of the sale price above ₩1.2B is taxed.; It can turn a gain of hundreds of millions of won into zero tax. Fall one day short of the conditions and the whole gain is taxed, so counting balance-payment dates is worth real money. Above ₩1.2B, only the proportional excess is taxed and the long-term deduction is generous.; Calculator →
Capital Gain & Gain After Deduction (양도차익·양도소득금액)양도차익·양도소득금액: The gain is sale price minus purchase price and necessary expenses. Subtract the long-term holding deduction for the gain after deduction, then the ₩2.5M annual basic deduction for the tax base.; Acquisition tax, brokerage and documented repairs all reduce the gain. Lose the receipt and that amount becomes tax. The ₩2.5M basic deduction is per person per year. Joint owners each get one, and two properties sold in different years each get one.; Calculator →
Exemption vs Relief (비과세와 감면)비과세와 감면: An exemption means the tax never applies. Relief means the tax is assessed and then partly or fully waived, with conditions, a ceiling, and an application.; An exemption applies without filing; relief is lost if you do not apply. Break a condition afterwards and the waived tax is clawed back, so relief with follow-on conditions, like first-home acquisition tax relief, is not finished until the conditions are met.; Calculator →
Penalty Tax (가산세)가산세: Extra tax added when you file or pay late: 20% for not filing, 10% for under-reporting, 40% for fraud, plus late-payment interest of 0.022% per day.; The daily interest adds up to more than 8% a year. Pay ₩10M one year late and the interest alone tops ₩800K. Filing voluntarily after the deadline still reduces the non-filing penalty, so if you missed it, filing fast is the only saving left.; Calculator →

Yield4

Cap Rate캡레이트 · Cap Rate·자본환원율: Annual net operating income divided by purchase price. It is the yield of the building itself, before any borrowing.; Borrowing only helps if the cap rate beats your loan rate. The gap between the two is the leverage spread.; Calculator →
Leverage Spread레버리지 스프레드: Cap rate minus loan rate.; Positive and borrowing lifts your return. Negative and every won borrowed costs you. A thin spread flips negative on a small rate rise.; Calculator →
NOI (Net Operating Income)순영업소득 · NOI: Rental income after vacancy losses and running costs, but before loan interest and tax.; It shows what a building actually earns. Headline rent flatters the picture because it ignores empty months and management costs.; Calculator →
Leverage (레버리지)레버리지: Using borrowed money to buy a bigger asset than your own cash allows. When the asset yields more than the loan rate your return on equity rises; when it yields less, your loss grows.; A building with a 5% cap rate bought with a 4% loan returns more than 5% on your cash. Rates at 6% and the same building loses money. The more you borrow, the harder it swings both ways, so check first whether you can survive a rate rise.; Calculator →

Rules16

Move-In Obligation전입의무: Take a mortgage in the capital region or a regulated zone and you must register your residence there within six months.; Miss it and the bank calls the loan: the whole balance, immediately, regardless of the term left. If the home came with a sitting tenant, check whether you fall under an exception.
Regulated Zone규제지역 · 조정대상지역·투기과열지구: A district designated to cool house prices. Designation tightens LTV, DSR, tax and the move-in duty all at once.; The same purchase in a regulated zone borrows far less and sells with a capital gains surcharge. Whether the surcharge applies is judged by the designation on the day you sell.; Calculator →
Land Transaction Permit Zone (토지거래허가구역)토지거래허가구역: An area where buying land (apartments included) above a size threshold requires district office permission first. Designated to curb speculation.; Permission usually comes with an owner-occupancy condition, which rules out buying with a tenant in place. A contract without permission is void, and using the property other than as permitted brings enforcement fines. Check designation and the residency period before you buy.
Residence Registration (전입신고)전입신고: Moving your resident registration to the new address. For tenants it is a condition of opposing power; for mortgage borrowers it fulfils the move-in obligation.; Opposing power begins at midnight the day after you move in and register. If the landlord takes a mortgage that same day, the bank ranks ahead of you. Register on moving day and get a fixed date too. With a mortgage, missing the deadline means the loan is called.; Calculator →
Fixed Date (확정일자)확정일자: A date stamp on the lease contract from the community centre or registry, publicly proving the contract existed that day. It is the condition for priority repayment.; Registration alone gives opposing power, but to claim a rank in an auction payout you need the fixed date. Without it a mortgage holder ranks ahead and your deposit may be gone. It costs almost nothing and can be done online, so get it the day you sign.; Calculator →
Opposing Power (대항력)대항력: The right to assert your tenancy against a new owner. It arises the day after you take possession and register your residence.; With it you can stay to the end of the lease and claim the deposit from whoever buys the home, even at auction. But a mortgage registered before you still ranks ahead, so check the property register for prior charges before signing.; Calculator →
Priority Repayment Right (우선변제권)우선변제권: The right to be paid your deposit from auction proceeds ahead of lower-ranked creditors. Opposing power plus a fixed date creates it.; Rank is decided by comparing your fixed date with the mortgage registration date. If you are earlier you are paid in full first; if the mortgage is earlier the bank takes its share and you get what is left. That is why the size of existing mortgages on the register is the whole story for deposit safety.; Calculator →
Small-Tenant Top Priority (최우선변제)최우선변제 · 소액임차인: Tenants with small deposits get a set amount ahead of mortgage holders regardless of fixed-date rank. The qualifying deposit and the protected amount are set by region.; In Seoul a deposit of ₩165M or less is protected up to ₩55M. But the rule that applies is the decree in force when the mortgage was registered, not today's, and the payout is limited to half the property's value. Do not conclude you are covered from the table alone.; Calculator →
Lease Reporting (임대차 신고)임대차 신고 · 전월세신고제: Housing leases with a deposit over ₩60M or monthly rent over ₩300K must be reported within 30 days. Landlord and tenant report together, but either side alone is enough.; Reporting grants a fixed date automatically. Late or false reports draw fines. Some landlords resist because it exposes rental income, but the duty is statutory and the tenant can file alone.; Calculator →
Renewal Request Right (계약갱신요구권)계약갱신요구권: Between six and two months before the lease ends, a tenant may demand one renewal that the landlord cannot refuse without a lawful ground. Once, for two years.; On renewal the deposit or rent may rise by at most 5%. Refusal needs a statutory ground such as owner occupancy, and a landlord who evicts on that ground then re-lets is liable for damages. Miss the window and the right lapses, so count the dates.; Calculator →
Deposit-to-Rent Conversion Rate (전월세전환율)전월세전환율: The annual rate used to turn a jeonse deposit into monthly rent. The legal cap is the lower of 10% and the Bank of Korea base rate plus 2 points.; Converting ₩100M of deposit at 4% gives about ₩330K a month. Anything above the cap is not owed. The cap moves with the base rate, so check it at the time of the contract.; Calculator →
Subscription Points (청약 가점)청약 가점 · 무주택기간·부양가족·가입기간: The score that ranks applicants for private-sector new builds: up to 32 for years without a home, 35 for dependents, 17 for savings-account tenure, 84 in total.; Popular complexes cut off high, so one weak line sinks you. Dependents swing the most depending on how co-resident parents and children are listed, and a wrong start date for the no-home period erases years. Before points, you must clear first-rank eligibility.; Calculator →
Special Supply (특별공급)특별공급: New-build units set aside for specific groups (first-time buyers, large families, carers of elderly parents, newlyweds), each with its own income, asset and no-home conditions.; Practically the only route for people with low points. Most types can be used once in a lifetime, and breaking any condition voids the win and adds a re-win restriction. Go through the condition table line by line before applying.; Calculator →
Re-Win Restriction (재당첨 제한)재당첨 제한: A winner and their household members are barred from winning another subscription for a period that depends on the type of home and its location.; Giving up the contract does not help, because the win itself starts the clock. Where several periods apply, the longest wins. A spouse's past win blocks you too, so check every household member's record before applying.; Calculator →
Resale Restriction (전매제한)전매제한: A ban on selling a newly allotted home for a set period. It attaches to price-capped and regulated-zone homes, with the period varying by area and price.; Even with a premium on the unit you cannot sell before the period ends; breaching it voids the contract and costs your subscription rights. If you would need to sell mid-way for cash, winning becomes a liability. Some complexes add a separate owner-occupancy duty after move-in.
Temporary Two Homes (일시적 2주택)일시적 2주택: Buy the new home before selling the old one and you are briefly a two-home owner; meet the conditions and you are treated as a single-home household. Buy the new home at least a year after the old one, then sell the old one within three years.; Meet it and you keep the capital gains exemption and basic acquisition tax rate; miss it by a day and you are taxed as a two-home owner. The usual failure is the old home not selling in time, so plan the sale backwards from the new home's balance date.; Calculator →

Korean terms are kept beside each entry on purpose. Those are the words you will actually hear at a bank counter. 한국어 용어 사전