8.8% is a rate that exists in no tax law — why ₩88,000 left a ₩1M lecture fee: 20% × a deemed 60% expense

One-off income such as lecture fees and manuscript fees is 'other income'. The law deems 60% of the amount received as expenses with no receipts, then withholds 20% (plus local income tax) on the rest, which comes to 8.8% of the amount received. No tax applies when other-income amount is ₩50,000 or less per payment; up to ₩3M a year you choose between leaving it as final withholding or adding it to your May return, and above that line the combined return is mandatory.

Rules as of 2026-10-08 · Sources: MOLEG statutes · ministry notices

Conditions used in the calculation

Type of income: Outside lecture fee, one-off, no employment relationship (other income)
Amount received: ₩1M
Deemed expense ratio: 60% (lecture and manuscript fees, Decree Art. 87)
Withholding rate: 20% + local income tax (Income Tax Act Art. 129)

Results

Tax withheld: ₩88,000 (8.8% of the amount received)
Amount that reached the bank account: ₩912,000
Other-income amount: ₩400,000 (₩1M − deemed expense ₩600,000)
Minimum taxable threshold: no tax when other-income amount is ₩50,000 or less per payment (₩125,000 in lecture fees)
The line where you keep a choice: ₩3M of other-income amount a year (₩7.5M in lecture fees)
Contest prize of ₩5M: tax ₩220,000 (80% deemed expense · effective 4.4%)
Sale of a ₩100M painting (deceased artist): tax ₩2.2M (90% deemed expense · effective 2.2%). ₩0 under ₩60M per piece or for a living Korean artist

At a glance

The parts of a ₩1M lecture fee

60% of the amount received is removed as deemed expense; 20% (+ local income tax) applies only to the remaining ₩400,000.

Amount received₩1M
Deemed expense 60%₩600,000
Other-income amount₩400,000
Tax withheld (8.8%)₩88,000

Why it works this way

An office worker agrees to give an outside lecture for a ₩1M fee. The amount that reaches the bank account is ₩912,000. ₩88,000 went to tax, which is 8.8%. Yet no tax law anywhere contains a rate of 8.8%. What is written is 20%. Why withhold only 8.8 when the rate says 20? Because the state recognizes 60% of the amount received as expenses without a single receipt. The device is called the deemed necessary expense.

Money that arrives once in a while (lecture fees, manuscript fees, contest prizes) carries the name 'other income'. Article 21 of the Income Tax Act lists it: lecture fees with no employment relationship, an author's manuscript fees and royalties, contest prizes, payments for transferring industrial property or goodwill, contractual penalties, even lottery winnings. The common thread is that it is one-off. This is where the road forks from the freelancer episode. The same lecture is other income at 8.8% if it happens once in a while, and business income at 3.3% if it is a business you repeat continuously. Which one it is depends on substance, not the contract's title. The tax office looks at whether you repeat it continuously for profit.

Dissecting 8.8 on a ₩1M lecture fee

The rate is 20%, but 60% of the amount received is deemed expense, so on the amount received it comes to 8.8%.

Amount received₩1M
Deemed expense 60%− ₩600,000 (no proof required)
Other-income amount₩400,000
× 20% + local income tax₩88,000 = 8.8% of the amount received

Demanding receipts to prove expenses for a single lecture would cost more than it saves, so Decree Article 87 treats 60% of lecture and manuscript fees as expenses. If your actual expenses exceed the deemed ratio, you can prove them and use those instead.

The ratio differs by type. Prizes from contests where entrants compete for rankings get 80% deemed expense, an effective 4.4%: a ₩5M prize carries ₩220,000 of tax. Sales of paintings and antiques get up to 90%, an effective 2.2%. But paintings and antiques are taxed only at ₩60M or more per piece, and works by a Korean artist alive at the time of sale are left out entirely. And there is a floor. When the other-income amount is ₩50,000 or less per payment, no tax is levied at all. That is ₩125,000 in lecture-fee terms. Small honoraria are not taxed.

Effective withholding by type (on the amount received)

The rate is 20% in every case; the deemed expense ratios of 60, 80 and 90% set the effective rate.

Lecture · manuscript fees (60% expense)8.8%
Contest prizes (80% expense)4.4%
Paintings · antiques sold (₩60M+ per piece · 90% expense)2.2%

Having 8.8 withheld does not always end the tax. The line is ₩3M of other-income amount a year. That is the figure after expenses, so in lecture fees it is up to ₩7.5M a year. Below the line you have a choice. First option: leave it. Separate taxation ends the tax at withholding and there is nothing to file. Second option: add it to your comprehensive income return in May. Withholding takes a flat cut regardless of how much you earn, so if your comprehensive tax rate is lower, the difference comes back as a refund.

In a low-income year (a student, or someone on leave with no other income) a combined return can bring back a large part of the tax withheld. Conversely, a high earner would pay more by combining, so leaving it alone is the answer. And once you cross the line, the choice disappears. In a year when other-income amount exceeds ₩3M the combined return is mandatory, and if you skip May thinking withholding settled it, the penalty clock starts running.

Three traps. First, repetition. A lecture that was other income the first time or two becomes business income once it is a monthly side job. Whether 8.8 or 3.3 was withheld does not matter. If the substance is continuous repetition, it belongs under business income on the May return. Second, the illusion of hiding. The company that paid the fee files a payment statement with the tax office, so the record is already in the system whether you file or not; exceed ₩3M and forget, and a non-filing penalty plus late-payment interest pile up. Third, the opposite direction: assuming withholding closed the matter and letting a refund slip away. A missed year can still be recovered. If you did not file in May at all, file a late return; if you filed but left the other income out, make a claim for correction (within 5 years of the filing deadline). The right to a refund itself lapses after 5 years. Withholding is not the end of the tax. It is a provisional payment.

Cases. An office worker gives a lecture at an outside institution for ₩1M: if one-off, it is other income, ₩88,000 is withheld, and if the year's other-income amount stays at ₩3M or less it can end there. A graduate student receives ₩100,000 as the fee for presenting at a conference: a personal service like a lecture, 60% expense, other-income amount ₩40,000, below the ₩50,000 floor, no tax. An aspiring writer wins a ₩5M contest prize: a ranked competition, 80% expense, ₩220,000 withheld. A retiree sells a late painter's work for ₩100M: 90% expense and separate taxation, ₩2.2M and done. Had the painting sold for ₩50M, or been by a living Korean artist, there would be no tax. A freelancer who left a job and gives two or three lectures every month: no longer one-off. That is the world of business income, bookkeeping and the May return.

Two things to do now. First, gather this year's withholding receipts for money you received now and then, and count your other-income amount. Which side of ₩3M you land on decides your May obligation. Second, if 8.8 was withheld in a low-income year, work out a refund through a combined return (for a past year, a late return or a claim for correction). The line between business and other income, and proof of actual expenses, differ case by case, so for large amounts sort it out with a tax adviser. Money that arrived by chance should not have its tax calculated by chance. The rules are all written down.

The legal basis

Drawn from government announcements and the statutes themselves as primary sources, covering only the relevant part.

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