[Korea Tax Common Sense Series 11] Finalize Resignation and Departure Tax Settlement within 14 Days Before Leaving

Complete Your Tax Settlement for Resignation or Departure within 14 Days

“If you remember just 14 days and May, you can cover most of the financial leaks.”

Receive your severance pay within 14 days after resignation; it’s safest to request the tax withholding documents immediately.
If your company did not perform mid-year tax adjustment, you must file a comprehensive income tax return yourself in May of the following year.
Local income tax is an additional 10% of the national tax and is levied separately.

Mid-year tax adjustment: Employees who resign before year-end settle their taxes for that year at the time of resignation.
Withholding tax receipt: A certificate showing the tax deducted by the company from your salary (essential document for year-end or May tax filing).
Comprehensive income tax (May): A procedure to report, refund, or make additional payments for the previous year's income all at once.
Local income tax: Tax paid to local governments, amounting to 10% of the national tax determined amount.
Tax representative: An agent who handles mail and payments in Korea on your behalf after you have left the country.

Did you receive your severance pay within 14 days of your resignation date?
Did you receive notification (payslip/settlement statement) from your company regarding mid-year tax adjustment?
Have you obtained the withholding tax receipt (for salary and severance pay) and the notification for local income tax payment?
👉 If you answered "Yes" to 3 or more items, the possibility of requiring additional documentation after departure is low.

Depending on whether a mid-year tax adjustment was performed, your May tax refund/additional payment will differ significantly.
If you secure the documents now, the stress of proxy submission and additional collection after departure will be greatly reduced.
If you miss the 10% local income tax, you may incur penalties.

Applicability: Company mid-year tax adjustment completed vs Company did not perform (self-filing in May)
Key Difference: If mid-year adjustment is complete, it's settled immediately; if not, you must file yourself in May of the following year (including the 10% local tax).
Actual Impact: Securing documents beforehand expedites refund timing; omissions can lead to additional payments and penalties.

On your last day of employment, request the withholding tax receipts (salary and severance pay), settlement statement, and payslip.
Ask your company to explicitly state the mid-year tax adjustment status via text message or email.
Confirm the notification and payment status of local income tax (10% of national tax) and save the documentation.
If you plan to leave the country, prepare to report a tax representative or arrange an alternative contact person/address in Korea.
If you had freelance income, also gather your income statements and invoices.

A: Resigned in September, company completed mid-year tax adjustment → Received documents, local tax paid. Filing in May of the following year is unnecessary (assuming no additional income).
B: Resigned in November, no mid-year adjustment → Refund of hundreds of thousands of won possible through comprehensive income tax filing in May of the following year (with 10% local tax reflected separately).

“Year-end settlement is complete upon resignation” → It's only complete if the company performs a mid-year tax adjustment. If not, you must file yourself in May.
“Local income tax is included in national tax” → It is levied and paid as a separate 10%.
“Leaving the country means ending Korean taxes” → Unsettled or unpaid amounts can still be billed or collected while residing abroad.