A 2025 reform to Korea's Restriction of Special Taxation Act (조세특례제한법) Article 87 extended the housing subscription savings deduction (주택청약저축 소득공제) from head-of-household filers only to also include the spouse. For foreign residents whose spouse is the registered head of household, this is the first time the deduction is within reach.
The reform is confirmed from the statute and from the NTS directly. This guide explains what the reform means, who qualifies, and how to claim it.
What Is the Housing Subscription Savings Deduction?
A housing subscription savings account (주택청약저축) is a bank account that serves two purposes. First, it is the required entry vehicle for Korea's public housing subscription lottery (청약), where residents apply to purchase new apartments built by government-affiliated developers. Second, contributions to the account are deductible from taxable income under certain conditions.
The deduction works like this: 40% of eligible contributions is removed from taxable income. Annual contributions are counted only up to ₩3M, so the maximum income deduction is ₩1.2M. Because it reduces taxable income rather than directly reducing your tax bill, the cash benefit depends on your marginal rate. At a 16.5% combined marginal rate, the maximum annual saving is about ₩198,000. At 26.4%, the maximum saving is about ₩316,800.
This is not a large amount on its own. But it sits on top of other year-end settlement deductions (rent tax credit, credit card deduction, and others), and for residents who already hold the account for housing lottery purposes, the incremental effort to claim it is minimal.
What Changed in the 2025 Housing Subscription Deduction Reform?
Before 2025, only the head of household (세대주) could claim this deduction. Under Korea's Resident Registration Act (주민등록법), many foreign residents could not use the head-of-household route. That is why the spouse route matters: even if a foreign resident was a Korean tax resident and held a savings account, the head-of-household gate could block the deduction.
The 2025 amendment to 조세특례제한법 Article 87 added "세대주의 배우자" (spouse of the head of household) to the list of eligible claimants. The NTS year-end settlement rule page describes the same change for contributions made from 1 January 2025 onward.
The spouse path is: your spouse is the registered head of household (세대주), you hold a housing subscription savings account in your own name, and you satisfy the income and home-ownership conditions below.
The reform applies to contributions made from 1 January 2025 onward. It first became claimable in the year-end settlement cycle for 2025 income.
Who qualifies
To claim the deduction, you must meet all four conditions at the same time:
1. Korean tax resident. You must have a Korean domicile/address under the tax rules or 183 or more days of residence.
2. Total annual salary at or below ₩70M. This is the gross wage income ceiling. Workers above ₩70M do not qualify (as of 2025, verify at the NTS rule page linked in sources).
3. No home owned. You must not own a home. File a no-home certificate (무주택 확인서) with your bank by end of February of the year following the tax year. If you own property jointly, check with the NTS how joint ownership is treated.
4. Head of household or spouse of head of household. You must be the registered head of household or the spouse of the registered head of household, and you must hold a housing subscription savings account (주택청약저축). Foreign residents with an ARC can open these accounts. The historical barrier was not account-holding; it was the 세대주 requirement. The reform removed that barrier for spouses.
The statute specifies no visa-type restriction. Eligibility turns on tax residency, income, home-ownership status, and the household-registration relationship. Confirm that your household registration is structured correctly (spouse as 세대주, you as 배우자) before filing.
The contribution cap
The rule counts annual contributions only up to ₩3M for the deduction calculation. Because the deduction is 40% of eligible contributions, the maximum income deduction is ₩1.2M.
Contributing less generates a proportionally smaller deduction. Contributing ₩2M per year generates an ₩800,000 income deduction, worth roughly ₩132,000 in tax at the 16.5% rate. If both spouses have accounts or both have wage income, confirm with NTS how the annual limit applies before filing.
The dual purpose of the savings account
If you already hold a housing subscription savings account for lottery purposes, there is nothing extra to open. The same account generates both the lottery eligibility and the potential tax deduction.
If you do not hold an account and are considering opening one specifically for the deduction, weigh the benefit against the other conditions. Lottery eligibility is separate from the tax deduction and depends on the housing type and the individual 모집공고. Check the current public notice before treating the account as useful for 청약.
How to claim it at year-end settlement
Year-end tax settlement (연말정산) runs through your employer. Here is the process:
Step 1: Confirm eligibility. Verify the four conditions above. If you are unsure whether your household-registration situation qualifies, contact NTS before proceeding.
Step 2: File the no-home certificate. Before the end of February following the tax year, file a no-home certificate (무주택 확인서) with the bank where your savings account is held. This is a required step; without it, the bank cannot confirm your eligibility for the deduction.
Step 3: Get your savings certificate. Request a housing subscription savings contribution certificate (주택청약납입증명서) from your bank. The certificate shows your total contributions for the calendar year.
Step 4: Submit to your employer. Your employer's HR or payroll team will have a year-end settlement document submission window. Submit the savings certificate along with your other deduction documents.
Step 5: Review your settlement result. After your employer processes the settlement, you will receive a withholding receipt (근로소득 원천징수영수증) showing your final tax position. Confirm the deduction appears. If it is missing and you believe you qualify, follow up with HR before the settlement window closes.
This deduction is designed around wage-income year-end settlement. If you are outside employer settlement, confirm with NTS whether your wage-income deduction can be reflected in a May comprehensive return.
What Is NOT Covered by the Housing Subscription Deduction?
Not a direct cash transfer. The deduction reduces your taxable income. It does not put the full deduction amount into your account. The tax saving appears as a reduced tax liability, or a refund if more tax was withheld than owed.
Not a visa-based entitlement. 조세특례제한법 Article 87 specifies no visa-type condition. Eligibility turns on tax residency, income level, home-ownership status, and the head-of-household relationship. The qualifying structure (spouse as 세대주, foreign resident as 배우자) is what matters.
Not retroactive. Contributions made in years before 2025 cannot be retroactively claimed under the new spouse eligibility rule.
Subject to renewal. 조세특례제한법 Article 87 is a special-taxation provision with a scheduled sunset. Check the law.go.kr page linked in sources for the current expiry date, and verify before each filing year.
FAQ
Can foreign residents in Korea claim the housing subscription savings deduction?
Yes, following a 2025 reform to 조세특례제한법 (Restriction of Special Taxation Act) Article 87. The reform added the spouse of the head of household as an eligible claimant. A foreign resident who is the spouse of a no-home head of household can now claim the deduction on contributions made from 1 January 2025 onward if the other tax conditions are met. Confirm that your household registration matches this structure with NTS before filing.
How much can I deduct, and how much will I actually save?
You can deduct 40% of your annual contributions to a housing subscription savings account (주택청약저축), with contributions counted up to ₩3M per year. The maximum income deduction is ₩1.2M. At a marginal income tax rate of 16.5%, that saves approximately ₩198,000. Higher-bracket filers at 26.4% save up to approximately ₩316,800. This is a deduction from taxable income, not a direct credit.
What are the conditions to qualify?
You need to meet all four conditions: be a Korean tax resident through a Korean domicile/address or 183 or more days of residence, have total annual salary at or below ₩70M, not own a home, and be either the registered head of household or the spouse of the registered head of household. The 2025 reform added the spouse path. All four conditions must be satisfied simultaneously.
How do I claim the deduction?
The deduction is claimed at year-end tax settlement (연말정산) in January through your employer. File a no-home certificate (무주택 확인서) with your bank by end of February of the following tax year. Then get a housing subscription savings contribution certificate (주택청약납입증명서) from the bank and submit it to your employer's HR or payroll team during the settlement window. The employer adjusts your tax withholding accordingly.
What is a housing subscription savings account used for beyond the deduction?
A housing subscription savings account (주택청약저축) has two purposes. First, it is used for Korea's housing subscription lottery (청약), where eligibility depends on the housing type and the individual 모집공고. Second, and separately, it generates this income deduction if you meet the tax conditions. Check the current public notice before treating the account as useful for 청약.
Does this deduction apply to contributions made before 2025?
The 2025 reform, which extended eligibility to spouses, applies to contributions made from 1 January 2025 onward. It first became claimable in the year-end settlement cycle for 2025 income. Contributions made in prior years under the old head-of-household-only rule were not eligible for spouses under the previous rules.
Can the head of household and the spouse both claim ₩3M each?
The official rule counts contributions up to ₩3M for the deduction calculation. If both spouses have accounts or both have wage income, confirm with NTS how the annual limit applies before filing.
What if I am not sure whether I qualify?
Contact NTS or visit a tax office with your ARC and marriage certificate. Your employer's HR team can also help check the documents before you submit the savings certificate during year-end settlement.
What to do next
- Check whether you hold a housing subscription savings account (주택청약저축). If yes, confirm your total contributions for 2025 through your bank.
- Verify the four eligibility conditions: Korean tax resident status, salary at or below ₩70M, no home owned, and head-of-household or spouse-of-head-of-household status.
- File a no-home certificate (무주택 확인서) with your bank by end of February following the tax year.
- If you are uncertain about your household-registration situation, contact NTS or bring your ARC and marriage certificate to a local tax office before your employer's settlement window.
- Get the savings certificate from your bank and submit it to your employer during year-end settlement.
- For a broader picture of what you may be eligible to claim at year-end settlement and beyond, see the year-end tax settlement guide.