Can foreign workers choose the flat 19% tax rate?

The flat 19 % withholding tax applies only to wages paid by a Korean company to temporary‑staffing agency workers assigned from a foreign corporation and cannot be elected by ordinary foreign employees; most foreign workers are taxed under the regular progressive rates【4†L1-L4】. Full details below.

Details

• Legal basis

• Article 156‑7 of the Income Tax Act mandates a 19 % withholding for temporary‑staffing agency workers hired from a foreign corporation【6†L1-L4】.

• This rate is a statutory withholding amount, not a voluntary flat‑rate election for individual foreign employees【1†L1-L4】.

• Who can use the flat 19 % rate

• Workers placed in Korea by a foreign temporary‑staffing corporation under a staffing contract.

• Payments made by the Korean hiring company to those workers.

• It does not apply to foreign students (D‑2), regular foreign employees on F‑4, E‑7, or other visas【1†L7-L9】.

• If you do not fall into the temporary‑staffing scenario

• Your income tax is calculated under the standard progressive schedule.

• You may file a year‑end tax settlement to claim deductions (e.g., tuition, insurance).

• In limited special cases, an employer can submit an “Application of Flat Tax Rate for Foreign Employees” form, but this requires Ministry of Strategy and Finance approval and is not generally available【1†L70-L73】.

• How the 19 % rate is applied (when applicable)

1. The Korean hiring corporation withholds 19 % of the worker’s wage and pays it to the tax office by the 10th day of the following month【1†L1-L4】.
2. The foreign staffing corporation also withholds tax on February payments for the prior year’s wages【1†L5-L7】.
3. No action is required from the worker; the employer handles the withholding.

• If you think the wrong rate was applied

• Request a correction from the tax office within five years from the end of the month the tax was withheld【5†L4-L5】.

• The tax office must decide within six months of receiving the request【5†L5-L6】.

• Hotlines for assistance

• General labor issues: 1350 (Labor Office)

• Tax questions: 132 (Legal Aid) or your local district tax office

• Foreign‑worker counseling: 1577‑0071