Complete Guide to Korean Streamer Comprehensive Income Tax

Korea's National Tax Service classifies streamer income under business code 940305 (one-person media content creation) as business income. However, the following are reported as miscellaneous income:

• Irregular appearance or lecture fees
• One-off sponsorships
• Annual income under 3 million KRW (de minimis)

If any of the following apply, business registration is recommended:

• Annual income above 24 million KRW
• Regular live streams (twice a week or more)
• Need to issue tax invoices for sponsorship or ad deals
• Want to deduct expenses such as equipment and rent

Pros: VAT refunds, expense recognition, tax invoice issuance, ability to handle large ad and sponsorship deals
Cons: 4 VAT filings per year, paying all 4 social insurances yourself, mandatory comprehensive income tax filing

Registering as a simplified taxpayer (annual sales under 80 million KRW) minimizes the VAT burden.

An additional 10% of the calculated tax is added separately as local income tax.

New businesses or small operators with annual income under 75M KRW can apply the simple expense rate of 64.2% (based on code 940305). In other words, if you earn 10M KRW, 6.42M KRW is automatically recognized as expense.

Mid-to-large operators use the standard expense rate of 14.9% plus receipts for actual key expenses (labor, rent, materials).

With the simple expense rate, you don't need to keep receipts — the easiest option.

Korea's comprehensive income tax uses a progressive structure, so the rate jumps roughly 9%p each time you move up a bracket. That means an extra 1M KRW in deductions can save 350,000 KRW alone in the 35% bracket. Combining the strategies below typically saves 15M to 30M KRW per year at the 100M KRW income level.

A. Income Deductions — Reduce the Taxable Base Itself

• National Pension and Health Insurance — Fully deductible from income. Self-paid portions are reflected automatically, but regionally-enrolled members must verify their entries manually.
• Yellow Umbrella Mutual Aid (Korean small business pension) — Business owners only. Up to 5M KRW per year deductible. Enroll via banks, securities firms, or the SME Federation. On business closure you can withdraw a lump sum, serving as a small-business retirement payout. Applied immediately to the May filing in the year you join.
• Personal Deductions — 1.5M KRW for yourself, 1.5M KRW for each spouse or dependent. Includes parents aged 60+ and children aged 20 or under. Extras: 1M KRW for elderly (70+), 2M KRW for disability, 1M KRW for single parent.
• Principal and Interest on Housing Lease Loans — Householders without a home can deduct 40% of jeonse loan principal and interest (annual cap 4M KRW).
• Long-Term Mortgage Interest — Full interest deduction on a home in your name (standard market price up to 600M KRW), with a 18M KRW cap for 15-year+ fixed-rate loans.

B. Tax Credits — Directly Subtracted From Computed Tax

• Pension savings (yeongeum-jeochuk) + IRP (Individual Retirement Pension) — Combined credit up to 9M KRW per year. If gross income is under 55M KRW, the rate is 16.5%; above that, 13.2%. Paying in 9M KRW returns up to about 1.48M KRW. Available to business owners too, with the downside that withdrawals are restricted until age 55.
• Medical Expense Credit — 15% of the portion exceeding 3% of total income. Combines medical bills for yourself and dependents, including up to 500,000 KRW per year for glasses and contact lenses. Fertility treatments get 30%, premature or congenitally ill children 20%.
• Education Expense Credit — Full credit for your own education (including graduate school); for each child, annual 3M KRW (preschool through high school) or 9M KRW (university) at 15%.
• Donation Credit — Statutory donations 100% (15% up to 10M KRW, 30% above), designated donations capped at 30% of income. Political donations up to 100,000 KRW get a 100% credit (note: must be in your own name).
• Monthly Rent Credit — No home ownership, gross income under 80M KRW, home with standard market price under 400M KRW: 17% credit on monthly rent up to 10M KRW per year. Can be claimed without the landlord's consent.
• Child Credit — For children aged 8 and up: 150,000 KRW for one, 350,000 KRW for two, plus 300,000 KRW each for three or more. Birth or adoption: 300,000 KRW for the first, 500,000 KRW for the second, 700,000 KRW each for the third and beyond.
• Standard Tax Credit — Automatically applies 130,000 KRW if you don't claim the items above. If your itemizable credits don't exceed 130,000 KRW, the standard credit is simply better.

C. Business Owner Only — Maximize Expenses

• Home Office Rent and Utilities Apportionment — If part of your home is a studio, you can expense a share of rent, maintenance, electricity, and internet by floor area. A 20–30% allocation is typically the safe zone.
• Equipment Depreciation — Cameras, lights, PCs, mics — assets above 1M KRW depreciate over 5 years using straight-line or declining balance. Under 1M KRW is immediately expensed. Galaxy and iPhone devices are apportioned by business-use ratio (commonly 50–70%).
• Labor Costs — Payments to managers, editors, thumbnail designers. Even family members can be on payroll if actual work can be proven (around 2.5M KRW per month for a spouse is the balance point for social insurance and tax burden).
• Issuing a Business Credit Card — Card statements directly serve as expense evidence. Separate from personal cards and register under Hometax's [Cash Receipts/Credit Cards] for automatic aggregation.
• Entertainment and Welfare Expenses — Offline viewer meetups, collab meals, staff meals, etc. Any item over 30,000 KRW requires qualified evidence (tax invoice/card/cash receipt).
• Vehicle Expenses — When you keep a business vehicle log, fuel, insurance, and depreciation are recognized. A business-use ratio of 50% or more is recommended.
• Wardrobe and Grooming — Ordinary clothing is in principle not recognized, but stage costumes, cosplay, and character outfits qualify if directly tied to your content. Keep receipts alongside content captures.

D. Tax Reductions and Deferrals — Big-Ticket Items

• Korean Youth Startup SME Tax Reduction — Young people aged 15–34 who start a business outside the capital area get 100% reduction for 5 years, or 50% inside the capital area. One-person media (940305) is eligible. The timing and address of business registration matter.
• SME Special Tax Reduction — Businesses below certain income thresholds receive a 5–30% reduction. Varies by region and industry.
• Loss Carryforward — Losses from a deficit year can be carried forward for 15 years and offset against profits in later years. Important for new and small streamers.
• Separate vs Comprehensive Taxation Choice — For financial income under 20M KRW, separate taxation (15.4%) may be more favorable. If your business income is in the 35%+ bracket, always choose separate taxation.

⚠ The items above are general information and applicability depends on your specific situation (residence, age, industry details). If your annual income exceeds 50M KRW, hiring a Korean tax accountant (typically 500,000–2M KRW per year) usually more than pays for itself.

1. Visit Hometax at hometax.go.kr → log in with a joint certificate or simple authentication
2. [Filing/Payment] → [Tax Filing] → [Comprehensive Income Tax] → [Compose Regular Filing]
3. Select filing type (simple expense rate / standard expense rate / miscellaneous income)
4. Enter business code 940305 and the income amount
5. Confirm automatically computed necessary expenses
6. Enter personal deductions and insurance premiums
7. Verify the computed tax (compare with our calculator)
8. File local income tax simultaneously (10%)
9. Enter the payment or refund account
10. Save the receipt PDF (5-year retention required)

• Omitting diamond payout amounts — Even if your agency withheld tax, you still have to report. Aggregate filing is required.
• Not reporting overseas platform income — Korean residents must include YouTube AdSense and TikTok global earnings in the total.
• Skipping expense receipts — Fine if you're going with the simple expense rate. If you go with actual expenses, keep them for 5 years.
• Missing the 4 social insurance deductions — If they aren't auto-linked, enter them manually.
• Late May filing — 20% non-filing penalty plus 9% late-payment interest. At minimum file on time and apply for installment payments.