- 2026 brackets: 10% to KRW 200m, 20% to KRW 20bn, 22% to KRW 300bn, 25% above.
- Local income tax adds 10% of the corporate tax — 11% to 27.5% in total.
- The annual return is due three months after year-end; an interim payment falls due mid-year.
- Dividends to foreign shareholders are then subject to withholding, reduced by treaty.
Korea’s 2025 tax reform reversed the cuts of a few years earlier. For financial years starting on or after 1 January 2026, each of the four corporate tax brackets is one point higher. Korea taxes progressively, so a company pays the lower rate on the first slice of profit and the higher rates only on the slices above.
| Taxable income | Corporate tax | With local income tax |
|---|---|---|
| Up to KRW 200 million | 10% | 11% |
| KRW 200 million – 20 billion | 20% | 22% |
| KRW 20 – 300 billion | 22% | 24.2% |
| Over KRW 300 billion | 25% | 27.5% |
Rates for financial years starting on or after 1 January 2026.
The calendar
For a calendar-year company, the annual return and payment are due by 31 March. An interim prepayment for the first half is due by 31 August, based on half of last year’s tax or on actual interim results. Local income tax is filed separately with the local government, by the end of April.
Korea taxes in slices: the low rate on the first slice, the higher rates only above it.
What small companies should know
- Losses carry forward and can be offset against future profits within limits.
- Tax credits exist for R&D, investment and hiring — worth checking before year-end.
- Dividends to foreign shareholders are subject to 22% withholding, reduced by tax treaty.
- Books in Korean are the basis for everything: no clean books, no clean return.
Questions readers ask
What is the corporate tax rate in South Korea in 2026?
10% up to KRW 200 million, 20% up to KRW 20 billion, 22% up to KRW 300 billion and 25% above, plus local income tax of 10% of the tax.
When is the corporate tax return due?
Within three months of year-end — 31 March for a calendar-year company.
Is there an interim payment?
Yes, due two months after the first half — 31 August for a calendar-year company.
Did the rates change in 2026?
Yes. Each bracket rose by one percentage point from 1 January 2026.