How Much Tax Does a Thai Employee Pay in Korea at 50M / 100M / 200M KRW?
Progressive Rates vs the 19% Flat Tax for Foreigners
If you hire Thai employees in Korea, or you are one yourself, you might ask:
“If my salary in Korea is 50M, 100M, or 200M KRW, how much tax do I actually pay?”
“Is the 19% flat tax for foreign workers better than the normal progressive tax?”
In this post, we’ll use a fictional Thai employee, Somchai, and see how his take‑home pay changes under:
The normal Korean progressive income tax (same as for Koreans), and
The 19% flat tax regime for foreign workers.
⚠️ Note:
The calculations below are based on a simplified model (no social insurance caps, no extra deductions, no tax‑free allowances).
They are meant to show direction and relative differences, not to match an actual payroll slip exactly.
1. Basic Setup: Somchai’s Situation
Assumptions for our Thai employee, Somchai:
Nationality: Thai
Location: Working for a Korean company, physically in Korea for the full year
Tax residency in Korea:
Family situation:
Annual gross salary (total pay from the employer):
50,000,000 KRW
100,000,000 KRW
200,000,000 KRW
(No separate non‑taxable allowances in this simple example.)
Other deductions and credits:
No pension savings, no medical expense deduction, no education or credit card deduction, no donations, etc.
This keeps the example clean and focused on the core structure.
Employee social insurance contributions in 2026 (Korea):
National Pension: 4.75% of salary
National Health Insurance: 3.595% of salary
Long‑term Care Insurance: 13.14% of the health insurance premium
Employment Insurance: 0.9% of salary
For simplicity, we apply these rates to the full annual salary (ignoring official caps and minimums).
On top of this, because Somchai is a foreign worker, he has a special option under Korean tax law.
2. Two Tax Options for Foreign Employees in Korea
Option 1 – Normal progressive tax (same as Koreans)
As a Korean tax resident, Somchai can be taxed exactly like a Korean employee:
Earned income deduction (a standard deduction based on gross salary)
Apply progressive income tax rates from 6% up to 45%, with a “quick deduction” for each bracket.
Apply the earned income tax credit (a special credit only for salary income, with limits depending on total salary).
Add local income tax, which is 10% of the final national income tax.
This is the standard 6–45% Korean income tax system that applies to residents, plus 10% local income tax.
Option 2 – 19% flat tax for foreign workers
Under Article 18‑2 of the Special Tax Treatment Control Law, foreign workers can choose a 19% flat income tax rate instead of the progressive rates, for up to 20 years from the first year they work in Korea.
Key features of the 19% flat tax option:
It applies to employment income earned in Korea.
19% is a national income tax rate.
You still pay local income tax = 10% of the national tax.
So the effective total rate is 19% + 1.9% = 20.9% of the taxable base.
This employment income is taxed separately from other Korean income.
But there is a very important catch.
3. The Catch: No Deductions, No Exemptions Under the 19% Flat Tax
According to the Korean National Tax Service (NTS) guide and Q&A for foreign workers:
If a foreign worker elects the 19% flat tax regime,
all income deductions, exemptions, reliefs, and tax credits under the Income Tax Act and the Special Tax Treatment Control Law are NOT available.
In practice, this means:
No earned income deduction
No basic deduction for the taxpayer, spouse, or dependents
No deductions for pension, medical expenses, education, credit card spending, donations, etc.
No tax credits of any kind (including the earned income tax credit)
Many items that are normally tax‑free for Korean workers become taxable, including:
In plain language:
Under the 19% flat regime, Somchai
gives up all deductions and exemptions,
and pays about 20.9% straight on (almost) the entire employment cost package.
This is why the flat tax can be worse than the normal system at lower salaries, but can become attractive at higher salaries.
4. Somchai’s Tax and Take‑Home Pay at 50M / 100M / 200M KRW
(Illustrative model only)
Again, the numbers below:
Ignore official caps on National Pension and Health Insurance,
Ignore all deductions/credits other than the most basic ones under the normal progressive system,
Assume no tax‑free benefits or extra allowances.
They are for illustration, not for preparing an actual year‑end tax settlement.
4.1 Salary 50M KRW – Flat tax is clearly worse
Annual salary: 50,000,000 KRW
| Item | Normal progressive tax | 19% flat tax |
|---|---|---|
| Income tax (national + local) | ~3,870,000 KRW (7.7%) | ~10,450,000 KRW (20.9%) |
| Employee social insurance | ~4,860,000 KRW (9.7%) | ~4,860,000 KRW (9.7%) |
| Total deductions | ~8,730,000 KRW (17.5%) | ~15,310,000 KRW (30.6%) |
| Net (take‑home) pay | ~41.3M KRW (82.5%) | ~34.7M KRW (69.4%) |
At a 50M salary, choosing the flat tax means Somchai:
Pays much more income tax, and
Takes home over 6M KRW less per year than under the normal progressive system.
4.2 Salary 100M KRW – Normal tax still wins
Annual salary: 100,000,000 KRW
| Item | Normal progressive tax | 19% flat tax |
|---|---|---|
| Income tax (national + local) | ~15,220,000 KRW (15.2%) | ~20,900,000 KRW (20.9%) |
| Employee social insurance | ~9,720,000 KRW (9.7%) | ~9,720,000 KRW (9.7%) |
| Total deductions | ~24,940,000 KRW (24.9%) | ~30,620,000 KRW (30.6%) |
| Net (take‑home) pay | ~75.1M KRW (75.1%) | ~69.4M KRW (69.4%) |
Even at 100M KRW:
The effective tax rate under the normal system is still well below 20.9%,
So the flat tax is still more expensive overall, and
Somchai’s net income is lower by roughly 5–6M KRW per year in this simplified model.
4.3 Salary 200M KRW – Now the flat tax starts to win
Annual salary: 200,000,000 KRW
| Item | Normal progressive tax | 19% flat tax |
|---|---|---|
| Income tax (national + local) | ~53,820,000 KRW (26.9%) | ~41,800,000 KRW (20.9%) |
| Employee social insurance | ~19,430,000 KRW (9.7%) | ~19,430,000 KRW (9.7%) |
| Total deductions | ~73,250,000 KRW (36.6%) | ~61,230,000 KRW (30.6%) |
| Net (take‑home) pay | ~126.8M KRW (63.4%) | ~138.8M KRW (69.4%) |
Here the picture changes:
Under the normal system, Somchai’s effective income tax (national + local) reaches around 27%.
Under the flat regime, it is fixed at about 20.9%.
The tax savings on 200M are now large enough that they outweigh the value of the lost deductions.
In this simple scenario, the flat tax gives Somchai roughly 12M KRW more net income per year at a 200M salary.
The NTS’s own example of a foreign worker earning around 200M KRW also shows this pattern:
for high earners, the 19% flat tax can reduce Korean tax compared to the normal progressive system.
5. How to Explain This to a Thai Employee or HR Team
From the Korean tax point of view (ignoring Thai tax rules for a moment), the message is:
(1) For salaries up to about 100M KRW
The normal Korean progressive system is usually more favorable for foreign employees at this level.
The 19% flat tax looks low on paper, but when you factor in the loss of all deductions and credits, it often becomes a bad deal.
(2) For high salaries (around 200M KRW and above)
At high income levels, the effective rate under the progressive system climbs into the high‑20% range,
while the flat regime stays at 20.9%,
so the flat tax can start to produce higher take‑home pay.
The exact “break‑even” salary where the flat tax becomes better depends on:
The amount of tax‑free allowances and fringe benefits
Whether there is a spouse or dependents
Whether there is other Korean‑source income
How much the person spends on items that would be deductible under the normal system
So in real‑life advisory work, the safest approach is:
Always simulate both options –
“normal progressive” vs “19% flat” –
using the employee’s actual data, then choose the cheaper option.
(3) Thai tax considerations are separate
For a Thai citizen like Somchai, there is also the question of Thai tax residency and taxation of foreign income, which depends on:
How many days he stays in Thailand,
Whether and when foreign income is brought (remitted) into Thailand, and
How Thai law treats foreign employment income in his specific situation.
Those Thai‑side rules are completely separate from Korean tax, and require their own analysis with a Thai tax adviser.
6. One‑Line Takeaway
For a Thai employee working full‑year in Korea:
At 50M and 100M KRW annual salary,
the normal Korean progressive tax system is generally more advantageous than the 19% flat regime.At around 200M KRW and above,
the 19% flat tax can start to deliver higher take‑home pay,
and should definitely be evaluated with a proper simulation.
And in all real cases, especially when home‑country tax is also in play, the most reliable strategy is:
Run the numbers for both options in Korea (normal vs flat),
then combine those results with a full Thai tax review for the employee’s global position.
