Rent Tax Credit (월세 세액공제) for Foreign Residents in Korea

Korea's rent tax credit (월세 세액공제) lets monthly renters reduce the income tax they owe, directly, by a percentage of the rent they paid during the year. The maximum credit is ₩1.7M per year. Most foreign residents who qualify never claim it, because no one tells them it exists.

This guide explains who qualifies, how much you can get, and exactly how to claim it, whether you are an employee going through year-end settlement with your company or a self-employed filer submitting your own return.

All figures reflect the thresholds in force as of January 1, 2024, following the statutory amendment to the Restriction of Special Taxation Act (조세특례제한법) Article 95-2. Verify current thresholds at the National Tax Service before filing (as of 2026).

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Who qualifies

You can claim the rent tax credit if you meet all of the following conditions on December 31 of the tax year.

Rental type. You must be renting on a monthly rent (월세) contract. Jeonse (전세) renters use a separate loan interest deduction, not this credit.

Residency. You must be a Korean tax resident (거주자), meaning you spent 183 days or more in Korea in the tax year.

Income cap. Your total salary income (총급여) must be ₩80M or less if you are an employee. If you are self-employed, your comprehensive taxable income (종합소득금액) must be ₩70M or less.

Home size or value. The rental property must be either 85 square meters or smaller, OR have a government-assessed value (기준시가) of ₩400M or less. These are an OR condition, not AND. A larger apartment with a low assessed value still qualifies.

Home ownership. You must not own any home in Korea as of December 31 of the tax year.

Address match. Your registered address on your Alien Registration Card (외국인등록증) or your domestic residency report (국내거소신고) must match the address on the lease contract.

No flat tax election. You must not have elected the 19% foreign-worker flat tax rate (외국인 단일세율) for the year you are claiming. That election forfeits all deductions and credits, including this one.

The following are excluded:

• Workers who elected the 19% flat tax rate for the claim year
• Renters who do not have 183 days of Korean residency in the tax year
• Homeowners (even if they are currently renting another property)
• Workers with salary income above ₩80M (employees) or comprehensive income above ₩70M (self-employed)
• Renters paying cash without bank transfer receipts

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How much you get

The credit is a percentage of the rent you actually paid during the year, up to a cap.

Rate tiers:

• 17% of rent paid, if your total income for the year is ₩55M or less
• 15% of rent paid, if your total income is between ₩55M and ₩80M

Annual rent cap: The credit applies to a maximum of ₩10M in rent paid per year. The cap was raised from ₩7.5M to ₩10M effective January 1, 2024 (as of 2024, verify at NTS).

Maximum credit: ₩10M x 17% = ₩1.7M per year.

Worked example

A foreign resident pays ₩800,000 per month in rent, totaling ₩9,600,000 for the year. Their annual salary income is ₩48M.

• Total rent paid: ₩9,600,000
• Applicable cap: ₩10,000,000 (rent paid is under the cap, so full amount counts)
• Rate: 17% (income is under ₩55M)
• Credit: ₩9,600,000 x 17% = ₩1,632,000

That amount is deducted directly from the income tax they owe. If the credit exceeds their tax liability for the year, the remainder is refunded.

A resident paying ₩1,000,000 per month (₩12M annually) would have their claimable rent capped at ₩10M. At 17%, the credit is ₩1.7M. The extra ₩2M in rent above the cap yields no additional benefit.

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How to claim

There are two claiming paths depending on your employment type.

Path 1: Employees, via year-end tax settlement (연말정산)

Your employer runs year-end settlement (연말정산) in January and February each year, covering the previous calendar year. This is when you submit your credit documents to HR or payroll.

Document checklist:

1. Foreign registration certificate (외국인등록사실증명서): issued by the Immigration Service. You can get it from any community service center (주민센터) or from HiKorea at hikorea.go.kr.
2. Lease contract (임대차계약서): a copy of your signed lease for the address you lived in. Make sure the address matches your registered address on your ARC.
3. Bank transfer receipts (이체확인증 or 계좌이체 내역서): statements showing every monthly rent payment made to the landlord's account during the year. Download these from your bank's app or counter.

Submit these to your company's HR or payroll team by the deadline they set, typically late January. HR will calculate the credit and apply it to your year-end settlement refund or additional tax due.

If your employer's deadline has passed, you can still claim the credit yourself via Hometax in May using Path 2.

Path 2: Self-employed filers and employees who missed year-end settlement

File your comprehensive income tax return (종합소득세 신고) via Hometax in May of the year following the tax year. The filing window is typically May 1 to May 31.

Steps:

1. Log in to Hometax at hometax.go.kr with your ARC number and certificate or the government-issued Naver or Kakao login.
2. Navigate to income tax filing (종합소득세 신고).
3. Complete your income information. In the deductions section, locate the rent tax credit (월세 세액공제) field.
4. Enter the total rent paid during the year.
5. Attach your foreign registration certificate, lease contract, and bank transfer receipts as scanned files.
6. Submit. The NTS processes refunds within 30-60 days after the filing window closes.

Self-employed filers: your income cap is ₩70M in comprehensive taxable income, not the ₩80M cap that applies to employees. If you are in the ₩70M-₩80M range, you do not qualify on the self-employed track.

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Common traps

ARC address mismatch

This is the most common reason claims are rejected. The address on your ARC or domestic residency report must exactly match the address on your lease contract. If you moved and did not update your registered address, update it at your local community service center (주민센터) before you file. Under immigration rules you are required to do this within 14 days of moving anyway.

Bring your ARC, passport, and new lease contract. The update takes about 10 minutes and is free.

Cash rent payments

Rent paid in cash does not qualify, even if the lease contract is genuine and registered. Bank transfer is required for every payment you want to claim. If your landlord has been requesting cash, switch to bank transfer going forward. Payments you cannot document with a bank transfer statement cannot be included in your claim.

The 19% flat tax rate trap

Some foreign workers elected the 19% flat income tax rate (외국인 단일세율) when they first arrived, often without fully understanding what they were giving up. The flat rate forfeits all deductions and credits for the year it is in effect. There is no way to retroactively claim the rent tax credit for a year in which you elected the flat rate. If you are currently on the flat rate and your income situation makes the progressive system more advantageous, you can switch back at your next year-end settlement.

Missing prior years: the 5-year amendment window

If you paid rent and qualified in any year from 2021 through 2025 but did not claim the credit, you can file an amended return (경정청구) via Hometax. Each year's amendment is filed separately. Prepare the lease contract and bank transfer receipts for each year. Refunds are typically processed within 2-3 months of submission.

This is one of the highest-value, lowest-effort recoveries available to long-term foreign residents. A renter who qualified but missed claims for three years could recover ₩3M-₩5M in a single Hometax session.

Joint-name leases and subletting

The credit applies to the person named on the lease contract. If the lease is in someone else's name (a Korean spouse, a colleague, a sublet arrangement), you cannot claim it, even if you are the one paying rent. Your name, or your name together with your spouse's name, must appear on the lease.

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What to do next

1. Check your address match first. Log in to HiKorea at hikorea.go.kr and confirm your registered address. If it does not match your current lease, go to your community service center (주민센터) today.
2. Pull your bank transfer records. Download 12 months of rent payment statements from your bank. Save them as PDFs.
3. Check whether you elected the 19% flat rate. Ask HR or check your most recent year-end settlement document. If you are on the flat rate and your effective tax rate would be lower under the progressive system, consider switching.
4. Employees: hand your documents to HR during January-February year-end settlement.
5. Self-employed and missed employees: file via Hometax in May.
6. Prior years: if you qualified in 2021-2025 and did not claim, file an amended return via Hometax for each missed year.

For a full picture of other tax credits and benefits you may be eligible for, use the benefits checker at /tools/child-benefits.

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What's changed

• 2026-05-27: Guide first published covering eligibility rules, the 17%/15% rate tiers, claiming paths for employees and self-employed filers, and common rejection traps.
• 2024-01-01: The annual rent cap was raised from ₩7.5M to ₩10M, and the employee income cap was raised from ₩70M to ₩80M, under the amended Restriction of Special Taxation Act (조세특례제한법 제95조의2).

@misc{seoulstart-korea-rent-tax-credit-guide,
  author = {{Seoulstart Editorial Team}},
  title = {{Rent Tax Credit (월세 세액공제) for Foreign Residents in Korea (2026)}},
  year = {2026},
  publisher = {Seoulstart},
  url = {https://seoulstart.com/guides/korea-rent-tax-credit-guide},
  note = {Last updated May 27, 2026}
}