The same ten years of ownership, yet 48% versus 80% deduction — the residence period was different
For a one-home household, the long-term holding deduction has two lines: 4% per year of ownership and 4% per year of residence, each capped at 40%, for 80% in total. Ten years owned and ten years lived in gives 80%; ten years owned and two lived in gives 40% plus 8%, 48%. On a ₩500M gain above the exemption, the deduction is ₩400M versus ₩240M, a ₩160M difference.
Conditions used in the video
- Case
- one-home household · ₩500M gain above the ₩1.2B exemption
- Ownership deduction
- 4% a year · max 40%
- Residence deduction
- 4% a year · max 40% (at least 2 years' residence required)
- Multiple homes
- 2% a year · 6% at 3 years to 30% at 15
- Heavy rate
- no deduction under the regulated-area multi-home heavy rate
- Proposal
- residence-weighted reform (before the Assembly as of 2026-09-05)
Results
- 10 years owned · 10 years lived in
- 80% · ₩400M deduction
- 10 years owned · 2 years lived in
- 48% (40% + 8%) · ₩240M deduction
- Difference
- ₩160M
- Multiple homes · 10 years
- 20%
- Multiple homes · 15 years or more
- 30%
- Regulated-area heavy rate
- 0%
At a glance
For one home the residence period nearly doubles the deduction; for multiple homes the table itself is lower.
- One home · 10 years lived in80%
- One home · 2 years lived in48%
- Multiple homes · 10 years20%
- Regulated-area heavy rate0%
Why it works this way
Someone expected an 80% deduction on selling a home held for ten years and got only 48%. The residence was different.
Table 2 of Income Tax Act Article 95(2).
- Ownership4% a year · max 40%
- Residence4% a year · max 40%
- Totalmax 80%
The residence line attaches only after at least two years of residence.
Ten years owned and ten lived in is 40 plus 40, 80%. Ten years owned and two lived in is 40 plus 8, 48%. On a ₩500M gain above the exemption, that is a ₩400M deduction versus ₩240M, a ₩160M difference.
Engine long-term-deduction figures.
- 10 owned · 10 lived in80% → ₩400M deduction
- 10 owned · 2 lived in48% → ₩240M deduction
- Difference₩160M
Multiple-home owners use a different table: 20% after ten years, 30% only beyond fifteen, and nothing under the regulated-area heavy rate. The government's residence-weighted proposal is before the Assembly as of 5 September 2026.
The legal basis
Drawn from government announcements and the statutes themselves as primary sources, covering only the relevant part.
Income Tax Act Article 95(2) (Long-term holding deduction)
In force Current (checked 2026-09-05)
Table 1 (general): 6% at three years' ownership, 2% more each year, 30% at fifteen years or more. Table 2 (one-home household, owned three years or more and lived in two years or more): 4% per year of ownership (max 40%) + 4% per year of residence (max 40%).
What this means
The same ten years splits into 48% and 80% by residence. Two years of living there before the sale changes the table.
Income Tax Act Article 104(7) (Heavy rate on multiple homes in regulated areas)
In force Current (checked 2026-09-05)
Where an owner of two or more homes in a regulated area sells a home, the heavy rate applies and the long-term holding deduction does not.
What this means
Under the heavy rate the deduction is zero. Ten years of ownership gets no table at all.
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 Long-Term Holding Deduction
Frequently asked
What if I never lived in it?
The residence line in Table 2 requires at least two years of residence. Under two years, Table 1 (20% at ten years) may apply instead, which is why this page uses two years and 48% to stay clear of that boundary. Check with a tax adviser.
Do I need the deduction if the sale is within the ₩1.2B exemption?
No. A one-home sale at ₩1.2B or less is exempt, so there is nothing to deduct. This deduction applies to the gain above ₩1.2B.
Why is it 20% for multiple homes?
Multiple-home owners use Table 1: 2% a year, from 6% at three years to a 30% maximum at fifteen. Under the regulated-area heavy rate there is no deduction at all.
What if the government proposal passes?
There is a reform proposal to weight the residence period more heavily, but as of 5 September 2026 it is before the National Assembly. Until it passes, this table applies.
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.