Payroll Services in South Korea
Fully managed South Korean payroll: income tax withheld from the National Tax Service tables, the four social insurances at 2026 rates and severance accrued on every payslip, with tax and premiums paid by the 10th and a named specialist a phone call away.
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What payroll in South Korea actually involves
Payroll in South Korea combines monthly income tax withholding with four social insurances that cost the employer about 11% of pay, plus severance worth a month’s pay for each year of service. Tax and premiums are both due on the 10th of the following month.
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Calculate Your Employee Costs in South Korea
Enter a gross annual salary to see the employer’s statutory cost for a South Korean employee in 2026: the four social insurances, with pension capped at KRW 6,590,000 a month, and the severance accrual.
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*Indicative figures only and not definitive legal advice. Local regulations change frequently. Consult an expertSouth Korea
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Employer Costs in South Korea Explained
A South Korean employee costs about 11% on top of gross salary in social insurance, plus severance that most employers accrue at one twelfth of pay: close to 19% in all. Income tax and the employee’s premiums come out of the employee’s pay, so they change net pay, not the employer’s cost. Here’s the breakdown.
National Pension is 9.5% of monthly pay, 4.75% each, on income up to KRW 6,590,000 a month from July 2026. Health insurance is 7.19%, split evenly, and long-term care insurance adds 0.9448% of pay, also split, equal to 13.14% of the health premium. Employment insurance is 0.9% each for unemployment benefits, plus an employer-only levy of 0.25% to 0.85% depending on company size.
Industrial accident insurance is paid by the employer alone at a rate set by industry, 1.47% on average in 2026 and lower for office work. The National Health Insurance Service collects all four premiums, due on the 10th of the following month.
Each month the employer withholds income tax from the simplified withholding tables of the National Tax Service, based on pay and the number of dependants, and employees can choose to have 80%, 100% or 120% of the table amount withheld. Local income tax of 10% of the income tax is withheld on top. Rates on annual taxable income run from 6% to 45%.
The withholding return and payment are due on the 10th of the month after salary is paid, or every six months for approved small employers. The employer then runs the year-end tax settlement, squaring each employee’s actual tax for the year with February’s pay.
Severance is 30 days’ average wages for each year of service, owed to employees with at least a year of service working 15 hours a week or more, on resignation as well as dismissal. It is paid within 14 days of leaving, with final wages, unless both sides agree to a later date, and late payment carries interest of 20% a year. Many employers fund it through a retirement pension plan instead of paying it from their own accounts.
Wages must be paid in full at least once a month on a fixed date. In workplaces with five or more employees, overtime, night work between 10pm and 6am and holiday work are paid at 50% more, and holiday work beyond eight hours at 100% more.
For an employee earning KRW 5,000,000 gross a month in an office-based business, the employer pays KRW 237,500 in pension, KRW 203,370 in health and long-term care, KRW 57,500 in employment insurance and about KRW 47,500 in accident insurance, KRW 545,870 in all, plus a severance accrual of KRW 416,667: a monthly cost of KRW 5,962,537.
The employee pays KRW 485,870 in premiums plus income tax from the withholding tables. The minimum wage is KRW 10,320 an hour in 2026, KRW 2,156,880 a month for a 40-hour week, and rises to KRW 10,700 an hour, KRW 2,236,300 a month, on 1 January 2027.
Employees earn 15 days of paid annual leave after a year with at least 80% attendance, one more day every two years up to 25, and one day for each full month in their first year. Meal allowances of up to KRW 200,000 a month are tax free, and since 2026 so are childcare allowances of up to KRW 200,000 a month for each child aged six or under.
On 1 January 2027 the National Pension rate rises to 10%, 5% each, and the minimum wage to KRW 10,700 an hour. The health insurance rate stays at 7.19% for 2027, as decided in September 2026.
South Korean payroll contributions and taxes, 2026
| Item | Employer | Employee | Applies to |
|---|---|---|---|
| National Pension | 4.75% | 4.75% | Pay up to KRW 6,590,000 a month from July 2026 |
| Health insurance | 3.595% | 3.595% | Total pay, 7.19% in all |
| Long-term care insurance | 0.4724% | 0.4724% | 13.14% of the health premium |
| Employment insurance | 0.9% plus 0.25% to 0.85% | 0.9% | Total pay; the employer levy depends on company size |
| Industrial accident insurance | By industry, 1.47% on average | — | Total pay |
| Income tax | — | 6% to 45%, plus 10% local income tax | Withheld monthly from the simplified tables |
| Severance | 30 days’ average wages a year | — | Employees with a year of service and 15 or more hours a week |
| Payment deadline | 10th of the next month | — | Withholding tax and all four premiums |
Monthly employer cost of an office employee in South Korea, 2026
| Monthly gross | National Pension | Health and long-term care | Employment insurance | Accident insurance | Severance accrual | Total monthly cost |
|---|---|---|---|---|---|---|
| KRW 3,000,000 | KRW 142,500 | KRW 122,022 | KRW 34,500 | KRW 28,500 | KRW 250,000 | KRW 3,577,522 |
| KRW 5,000,000 | KRW 237,500 | KRW 203,370 | KRW 57,500 | KRW 47,500 | KRW 416,667 | KRW 5,962,537 |
| KRW 8,000,000 | KRW 313,025 | KRW 325,392 | KRW 92,000 | KRW 76,000 | KRW 666,667 | KRW 9,473,084 |
South Korean payroll in 2026 and from 1 January 2027
| Item | 2026 | From 1 January 2027 |
|---|---|---|
| National Pension | 9.5%, 4.75% each | 10%, 5% each |
| Health insurance | 7.19% | 7.19%, unchanged |
| Minimum wage, hourly | KRW 10,320 | KRW 10,700 |
| Minimum wage, monthly (209 hours) | KRW 2,156,880 | KRW 2,236,300 |
The cost table uses the 1.15% employment insurance rate for employers with fewer than 150 employees and an office accident insurance rate of about 0.95%, including the commuting accident and wage claim guarantee levies. Severance is accrued at one twelfth of pay; it runs higher where bonuses raise average wages. These are TopSource calculations from the verified 2026 rates.
Rates, ceilings and amounts shown are for 2026, with the changes confirmed for 2027, and were verified on 8 October 2026 against the National Pension Service, the National Tax Service, the Ministry of Employment and Labor, the Ministry of Health and Welfare and the Labor Standards Act. This page is general information, not tax or legal advice.
How our South Korean payroll service works
Why Choose TopSource for Global Payroll in South Korea
TopSource for payroll, Employer of Record or any other of our services represents a simpler, more reliable and transparent option. If you would rather not employ staff in South Korea directly, our Employer of Record in South Korea can employ them on your behalf.
We don’t hide fees or sneak price increases. We run South Korean payroll in-house and file under your own National Tax Service and social insurance registrations rather than a bureau’s, so the same team that files your withholding returns answers your calls. You get a named account manager, one consolidated monthly invoice covering salaries, contributions, taxes and fees, and one live Portico view of South Korea beside every other country we run for you. Portico syncs with your time-tracking, leave and HR systems via API – set up by our onboarding team, not left to yours. GDPR, SOC 2 and ISO 27001 certified.
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Accelerating your growth in South Korea and beyond
TopSource goes far beyond payroll, acting as your end-to-end partner in global workforce management. From Employer of Record (EOR) services and seamless entity setup to localized accountancy and fractional HR support, we cover every aspect of international employment.
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Whether you’re entering the market or scaling operations, our specialists provide the insight and guidance you need to succeed in one of the world’s most dynamic and regulated employment landscapes. With TopSource, you’re backed by real experts, every step of the way.
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South Korean payroll FAQs
National Pension 9.5%, health insurance 7.19% and long-term care 0.9448% of pay, all split evenly, plus employment insurance of 0.9% each and an employer levy of 0.25% to 0.85%. Industrial accident insurance is paid by the employer alone at a rate set by industry.
Each month from the National Tax Service’s simplified withholding tables, with local income tax of 10% of that amount on top. Employees can choose 80%, 100% or 120% of the table amount, and the year’s tax is settled with February’s pay.
Withheld income tax and local income tax are due on the 10th of the month after salary is paid, and the four social insurance premiums on the 10th of the following month, collected by the National Health Insurance Service.
About 11% on top of gross pay in social insurance, plus severance accrued at one twelfth of pay: an office employee on KRW 5,000,000 a month costs about KRW 5,962,537. Tell us the role and salary and we’ll send the full cost within one business day.
Yes. Employees with at least a year of service and 15 or more hours a week are owed 30 days’ average wages for each year worked, whether they resign or are dismissed, paid within 14 days of leaving.
KRW 10,320 an hour in 2026, KRW 2,156,880 a month for a 40-hour week. It rises by 3.7% to KRW 10,700 an hour, KRW 2,236,300 a month, on 1 January 2027, in every industry.
On 1 January 2027 the National Pension rate rises to 10%, 5% each, and the minimum wage to KRW 10,700 an hour. The health insurance rate stays at 7.19%.
Among others, meal allowances of up to KRW 200,000 a month for employees not given meals, childcare allowances of up to KRW 200,000 a month for each child aged six or under since 2026, and allowances of up to KRW 200,000 a month for using their own car for work.
Yes. Since 19 November 2021 employers must give a wage statement with every payment, showing each pay item, how variable items were calculated and every deduction. Failing to issue one, or issuing an incomplete one, can be fined up to KRW 5 million.
Registering as a withholding agent and for the four insurances generally requires a local presence, such as a Korean subsidiary or branch. Without one, the usual route is an Employer of Record. TopSource can run payroll for your Korean entity or employ your team through our Employer of Record service.
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