Back out the net price from VAT-inclusive amounts, and estimate VAT payable for standard taxpayers (output − input VAT) and simplified taxpayers (sector value-added ratios). Includes the 2026 card-sales credit (1.3%, ₩10M cap), the ₩104M simplified threshold and the ₩48M exemption. Nothing leaves your browser.
How Korean VAT works
Korea levies 10% VAT (VAT Act Art. 30). Standard taxpayers pay output VAT on sales minus input VAT on purchases backed by tax invoices or business-card receipts (Arts. 37–38). A ₩11,000 sale is ₩10,000 of revenue plus ₩1,000 held for the tax office.
Simplified taxpayers
Sole proprietors with prior-year VAT-inclusive sales under ₩104M may be simplified taxpayers. Their VAT = sales × sector value-added ratio × 10% (15% for retail and restaurants, 20% manufacturing, 25% lodging, 30% most services, 40% professional/real-estate), minus 0.5% of invoiced purchases and the card-sales credit. There is no refund, and if annual sales are under ₩48M payment is exempted (Art. 69).
Example: a convenience store with ₩70M annual sales: 70M × 15% × 10% = ₩1.05M, minus ₩225k purchase credit and ₩715k card credit ≈ ₩110k payable.
Common mistakes
Taking 10% of VAT-inclusive sales overstates VAT (the correct share is 1/11). Purchases on a personal card or with simple receipts often can’t be deducted. The ₩10M card-credit cap is annual, not per filing period.
FAQ
How do I get the net price from a VAT-inclusive amount?
VAT = gross × 1/11 (truncated) and net = gross − VAT. ₩10,000 incl. VAT is ₩9,091 net + ₩909 VAT — not ₩1,000 VAT.
Do simplified taxpayers under ₩48M pay VAT?
No — if the year's VAT-inclusive sales are under ₩48M, payment is exempted (VAT Act Art. 69), though you must still file.
Who gets the card-sales credit?
Sole proprietors with prior-year sales ≤ ₩1B: 1.3% of card/cash-receipt sales until 31 Dec 2026, capped at ₩10M per year (Art. 46). Corporations are excluded.
Simplified or standard taxpayer — which is better?
Simplified taxpayers usually pay far less, but get no refunds. If start-up investment makes input VAT exceed output VAT, standard status lets you claim a refund.
Sources: VAT Act Arts. 30, 37–39, 46, 61, 63, 69; Enforcement Decree Arts. 109, 111 (as of October 2026).
Disclaimer — not tax advice
Results are estimates computed from your inputs and the statutory rates published as of October 2026 — not tax or legal advice, nor an official determination. Confirm with the official calculators below or a licensed tax accountant / labour attorney before acting.
