Tax for a landlord collecting rent — separate taxation under ₩20M, combined above
Two landlords each rent out one officetel at ₩1M a month, and their tax differs: ₩924,000 and ₩616,000. Same rent; the difference was whether their other income exceeded ₩20M. Housing rental income is not set by the rent. Below ₩20M a year you choose between 14% separate taxation and comprehensive taxation; above it there is no choice and it is combined with other income at progressive rates. Separate taxation deducts an expense rate (60% registered, 50% unregistered) and a basic deduction (₩4M registered, ₩2M unregistered, only if other comprehensive income is ₩20M or less), then applies 14%.
Conditions used in the calculation
- Case
- one officetel · ₩1M a month (₩12M a year) · registered or not · other comprehensive income ₩15M vs ₩30M
- Step ①
- scope: monthly rent from one home · one home per couple with a standard price of ₩1.2B or less is exempt · jeonse deposits: three or more homes per couple · total over ₩300M → deemed rent
- Step ②
- the ₩20M line · at or below: choose 14% separate or comprehensive · above: comprehensive without choice · measured on gross receipts before expenses
- Step ③
- separate taxation: receipts − expenses (60% registered · 50% unregistered) − basic deduction (₩4M registered · ₩2M unregistered · only if other comprehensive income is ₩20M or less) × 14%
- Step ④
- deemed rent: (total deposits − ₩300M) × 60% × 3.1% a year · interest and dividends earned on the deposits deducted · small homes (40㎡ · standard price ₩200M or less) excluded from the count until 2026-12-31
- Filing
- May comprehensive return · business registration · a landlord without a job joins health insurance as a regional member
Results
- ₩12M a year · unregistered · other income ₩30M
- expenses ₩6M · deduction ₩0 · base ₩6M · ₩924,000
- ₩12M a year · unregistered · other income ₩15M
- deduction ₩2M · base ₩4M · ₩616,000
- ₩12M a year · registered · other income ₩15M
- expenses ₩7.2M · deduction ₩4M · base ₩800,000 · ₩123,200
- ₩2M a month · ₩24M a year
- comprehensive taxation, stacked on wage or business income, which raises the rate
- Deemed rent · three homes totaling ₩500M
- (₩500M − ₩300M) × 60% = ₩120M × 3.1% = ₩3.72M a year
- The same ₩1M rent
- ₩924,000 · ₩616,000 · ₩123,200, depending on other income and registration
At a glance
Unregistered with ₩30M of other income ₩924,000; with ₩15M ₩616,000; registered ₩123,200.
- Unregistered · other income ₩30M₩924,000
- Unregistered · other income ₩15M₩616,000
- Registered · other income ₩15M₩123,200
Why it works this way
Two landlords each rent out one officetel at ₩1M a month. One paid ₩924,000 in tax on that rent, the other ₩616,000. Same rent; the difference was whether their other income exceeded ₩20M. And for someone collecting ₩2M a month the calculation itself changes. Housing rental income is not set by the rent. The tax splits on whether annual receipts are below or above ₩20M, how much other income there is, and whether the landlord is registered. Most landlords pass May not knowing whether it is taxable or what to file where, then receive several years' bills at once. Many assume it is not reportable, but it is, from one home.
Income Tax Act Article 12(2)(b) · Article 25(1).
- Monthly renttaxable from one home · one home per couple with a standard price of ₩1.2B or less is exempt · with two or more homes all rent is taxable
- Jeonse depositsthree or more homes per couple · total over ₩300M → deemed rent
- Exceptionsmall homes (40㎡ or less · standard price ₩200M or less) excluded from the count until 31 December 2026
The home counts differ for rent and deposits and are combined per couple, which confuses most people. Not knowing, you pay several years of tax on a second home's rent along with penalties.
Step ② The ₩20M line. At or below it you choose between 14% separate taxation and comprehensive; above it there is no choice and it is combined with other income at progressive rates. ₩1M a month is ₩12M a year, so separate taxation is available; ₩2M a month is ₩24M, comprehensive, stacked on wage or business income and raising the rate. The line is measured on gross receipts before expenses, which confuses people, and not knowing, a small rent increase that crosses it jumps the rate. Below ₩20M, which is cheaper depends on other income; with almost no other income, comprehensive can be cheaper, so run both.
Income Tax Act Article 64-2 · Enforcement Decree Article 122-2. This is where the two landlords parted.
- Formulareceipts − expenses (60% registered · 50% unregistered) − basic deduction (₩4M registered · ₩2M unregistered · only if other comprehensive income is ₩20M or less) → × 14%
- ₩12M · unregisteredwith other income of ₩30M, expenses ₩6M · deduction ₩0 · base ₩6M · ₩924,000 / with other income of ₩15M, deduction ₩2M · base ₩4M · ₩616,000
- Registeredexpenses ₩7.2M · deduction ₩4M · base ₩800,000 · ₩123,200. The same ₩1M rent becomes ₩924,000 or ₩123,200
The deduction turns on other income, so employees usually get none. Not knowing, you amend later or pay at 50% unaware of the value of registering.
Step ④ Deposits are deemed rent. With three or more homes and deposits totaling over ₩300M, the excess × 60% × 3.1% a year applies, less interest and dividends earned on the deposits. Three homes totaling ₩500M: ₩500M − ₩300M = ₩200M × 60% = ₩120M × 3.1% = ₩3.72M a year. Actual rent is added to test the ₩20M line. The 3.1% is in the ministerial rules and up to two homes are out of scope, which confuses people; not knowing, you believe there is nothing to file and receive a deemed-rent bill. The May sheet is three lines: ① homes per couple, total rent, total deposits; ② is rent plus deemed rent ₩20M or less, then the cheaper of separate and comprehensive; ③ registration and the ₩20M other-income test for the expense rate and deduction. With three lines, May preparation is done; note business registration and, for a landlord without a job, regional health insurance.
All four steps are passed: rent from one home, deposits from three, the ₩20M line, expense rate and deduction, deemed rent. The same ₩1M rent split into ₩924,000, ₩616,000 and ₩123,200 on other income and registration. Not knowing the scope costs years of tax with penalties, not knowing the line jumps the rate, not knowing deemed rent brings a bill. Two things to do now: put homes per couple, rent and deposit totals on one line, and if near ₩20M, check the line before setting the rent. Expense rates and registration conditions vary, so consult a tax adviser before May.
The legal basis
Drawn from government announcements and the statutes themselves as primary sources, covering only the relevant part.
Income Tax Act Article 12(2)(b) · Article 25(1) (One-home rent exemption · Deemed rent)
In force Current (checked 2026-09-05)
Rental income of a person owning one home is exempt (except standard price over ₩1.2B). Where an owner of three or more homes holds deposits totaling over ₩300M, deemed rent is 60% of the excess times the time-deposit interest rate. Small homes are excluded from the count until 2026-12-31.
What this means
Rent counts from one home, deposits from three. The home counts differ.
Income Tax Act Article 64-2 (Separate taxation of housing rental income)
In force Current (checked 2026-09-05)
Where gross rental receipts are ₩20M or less, the taxpayer may choose 14% separate taxation. The separate-taxation income is gross receipts less necessary expenses (60% registered · 50% unregistered) and a basic deduction (₩4M registered · ₩2M unregistered, where other comprehensive income is ₩20M or less).
What this means
₩20M is the door between two taxes, and registration and other income split the same rent into ₩924,000 and ₩123,200.
Income Tax Act Enforcement Rules Article 23 (Deemed rent interest rate)
In force Current · revised yearly (checked 2026-09-05)
The time-deposit interest rate applied to deemed rent is 3.1% a year.
What this means
The ₩3.72M on three homes totaling ₩500M comes from this rate. It changes yearly.
Run it on your own numbers
The calculator opens with these conditions already filled in. Change the figures and your own case comes straight out.
Open the Rental Income Tax Calculator
Frequently asked
Is rent from a single home reportable?
Yes. Monthly rent is taxable from one home. But one home per couple with a standard price of ₩1.2B or less is exempt. With two or more homes all rent is taxable.
Is there no tax if I only take jeonse deposits?
With three or more homes per couple and deposits totaling over ₩300M, deemed rent applies. Three homes totaling ₩500M give ₩3.72M a year. Up to two homes are out of scope.
Is the ₩20M line after expenses?
No. It is gross receipts before expenses. ₩2M a month is ₩24M a year, so comprehensive taxation applies.
Can employees claim the basic deduction?
Only if other comprehensive income is ₩20M or less. Employees usually exceed that with wages, so only the expense rate applies without the deduction.
How much does registering as a landlord help?
The expense rate rises from 50% to 60% and the deduction from ₩2M to ₩4M. On ₩12M a year with ₩15M of other income, ₩616,000 falls to ₩123,200. Registration has its own conditions.
Which is cheaper, separate or comprehensive?
It depends on other income. With almost no other income, comprehensive can be cheaper, so at ₩20M or less run both.
Results are estimates based on the inputs and on the rules as at the stated date. They may differ from a lender's actual assessment, and the rules change often. Take professional advice before any decision that matters.