If your 2026 interim comprehensive income tax bill in South Korea is difficult to pay, you should check the rules for estimated tax filing and installment payments. If your business performance declined significantly during the first half of the year, you may qualify to file an estimated interim tax amount under the statutory requirements. If the tax payable exceeds KRW 10 million, you may be able to pay part of it in installments. The filing and payment deadline is Monday, November 30, 2026.self-employed business owners in South Korea should check three things: how much their income declined between January and June, whether they meet the requirements for estimated interim tax filing, and how much of their tax bill can be paid in installments.
A decline in sales does not automatically reduce the amount stated in a tax notice. Estimated tax filing is a procedure for recalculating the tax amount, while installment payments divide the payment obligation across different deadlines.
How South Korea's Interim Comprehensive Income Tax Is Calculated
As a general rule, interim comprehensive income tax payments are calculated based on the previous year's tax payment record. South Korea's National Tax Service (NTS) sends interim payment notices to eligible taxpayers in early November. The ordinary interim tax amount is generally calculated as half of the interim payment base amount.
The interim payment base amount does not simply mean the amount paid in May of the previous year. It reflects factors including the previous year's interim tax payments, tax paid upon final return filing, additional tax payments, and tax refunds.
The basic calculation is as follows:
Interim tax payable = Interim payment base amount × 50% − Tax already paid through preliminary returns on gains from sales of land and similar assets during the interim payment period
For example, if the interim payment base amount is KRW 12 million and there is no preliminary tax payment to deduct, the interim tax bill will be KRW 6 million.
However, if business was strong last year but both sales and profits declined significantly during the first half of this year, a KRW 6 million tax bill may no longer reflect the business's current financial circumstances.
In this situation, business owners should examine the estimated interim tax filing system.
The 30% Rule for Estimated Interim Tax Filing in 2026
You may choose to file an estimated interim tax amount if your calculated 2026 interim tax liability is less than 30% of the interim payment base amount.
The important figure is the estimated tax calculated under South Korean tax law, not the percentage decline in sales.
A 30% decline in sales does not automatically make you eligible. Similarly, a sales decline of less than 30% does not necessarily disqualify you.
For example, suppose your interim payment base amount is KRW 10 million:
Interim payment base amount: KRW 10 million
Ordinary interim tax bill: KRW 5 million
Estimated filing eligibility threshold: Less than KRW 3 million
If the estimated interim tax calculated using income from the first half of 2026 is KRW 2.5 million, it falls below KRW 3 million and therefore satisfies this eligibility condition.
On the other hand, if the estimated amount is KRW 3.5 million, it does not satisfy this condition, even though it is lower than the ordinary KRW 5 million tax bill.
One point frequently causes confusion.
The 30% threshold applies to the interim payment base amount, not to the amount shown on the interim tax notice.
In the example above, using KRW 1.5 million, which is 30% of the KRW 5 million tax bill, as the eligibility threshold would produce an incorrect result.
How the Estimated Interim Tax Amount Is Calculated
Estimated interim tax filing is based on actual comprehensive income earned between January 1 and June 30, 2026.
It is not calculated by simply multiplying first-half sales by a fixed percentage. The calculation must reflect comprehensive income, including business income, as well as applicable deductions and tax reductions or credits.
The calculation consists of three main steps.
1. Annualize the first-half comprehensive income by multiplying it by two, then calculate the taxable income base after accounting for carried-forward losses and comprehensive income deductions.
2. Apply South Korea's basic comprehensive income tax rates of 6–45% to the taxable income base to determine the calculated tax.
3. Calculate the estimated interim tax amount by taking half of the calculated tax and subtracting applicable statutory deductions, tax credits or reductions, withholding taxes, and other legally deductible amounts through June 30, 2026.
For example, if sales declined but expenses also fell, leaving actual income largely unchanged, the estimated tax may not decrease as much as expected.
Conversely, even if the decline in sales was relatively small, a substantial increase in expenses could significantly reduce taxable income and produce a different result.
Therefore, when considering estimated interim tax filing, business owners should examine first-half sales, deductible business expenses, and comprehensive income together rather than comparing sales figures alone.
Special Filing Requirements and the KRW 500,000 Threshold
Certain resident taxpayers who are required to maintain double-entry bookkeeping records, have no interim payment base amount, and conducted business during the first half of 2026 may be subject to a separate mandatory filing requirement.
Under South Korean accounting and tax rules, double-entry bookkeeping records transactions by classifying them into categories such as assets, liabilities, revenue, and expenses.
If the estimated interim tax amount is less than KRW 500,000, payment is not required. However, if you want an existing interim tax notice canceled, you must submit an estimated interim tax return.
For example, suppose a business owner receives an interim tax bill of KRW 4 million, but the estimated tax amount calculated in accordance with the statutory requirements is KRW 400,000.
Because the estimated amount is below KRW 500,000, the taxpayer is not required to pay it. However, if the original tax notice has already been issued, the taxpayer must file the appropriate return to have the notified amount canceled.
Simply leaving the bill unpaid and waiting is not the same as submitting a legally valid estimated interim tax return.
The filing deadline is November 30, 2026.
Separately, when the ordinary interim tax amount itself is less than KRW 500,000, South Korea's small-amount non-collection rule applies. This should be distinguished from canceling an existing tax notice through estimated interim tax filing.
Installment Payments: How Much Can Be Deferred?
If your interim comprehensive income tax exceeds KRW 10 million, you may pay part of it in installments within the limits established by South Korean tax law.
Installment payments do not reduce the total tax owed. They allow part of the amount otherwise due in November to be paid by a later deadline.
| Interim tax amount | Maximum amount eligible for installment payment | Amount payable by November 30 |
|---|---|---|
| KRW 8 million | Not eligible | KRW 8 million |
| KRW 12 million | KRW 2 million | KRW 10 million |
| KRW 18 million | KRW 8 million | KRW 10 million |
| KRW 20 million | KRW 10 million | KRW 10 million |
| KRW 30 million | KRW 15 million | KRW 15 million |
| KRW 50 million | KRW 25 million | KRW 25 million |
The calculation rules are divided into two brackets.
For tax amounts exceeding KRW 10 million but not exceeding KRW 20 million, you may pay in installments up to the amount exceeding KRW 10 million.
For tax amounts exceeding KRW 20 million, you may pay up to 50% of the total interim tax amount in installments.
For example, if your interim tax bill is KRW 18 million, you can pay KRW 10 million by November 30 and defer the remaining KRW 8 million through the installment payment system.
If your tax bill is KRW 30 million, you may defer up to KRW 15 million.
The installment payment deadline for 2026 interim tax is Monday, February 1, 2027. The NTS advises that payment notices for the installment portion will be issued in early January 2027.
Estimated Tax Filing vs. Installment Payments: Which Should You Choose?
If your income declined significantly during the first half of the year, it is advisable to check your eligibility for estimated interim tax filing first.
If you do not qualify for estimated filing but are temporarily short of funds, you should calculate how much of your tax bill can be paid in installments.
The two systems serve different purposes, so the appropriate choice depends on your business circumstances.
| Category | Estimated interim tax filing | Installment payments |
|---|---|---|
| Purpose | Calculate tax based on first-half business performance | Divide payments across different deadlines |
| Main eligibility condition | Estimated tax is less than 30% of the base amount, among other requirements | Tax payable exceeds KRW 10 million |
| Changes the total tax amount? | May change depending on the calculation | No |
| Main 2026 deadline | November 30 for filing and payment | November 30 for the initial payment |
| Additional payment deadline | Not applicable | February 1, 2027 |
If the tax payable calculated through estimated interim tax filing also exceeds KRW 10 million, the installment payment rules may apply.
Therefore, the two systems are not necessarily mutually exclusive.
How to Check and Pay Your Interim Tax Through Hometax
If you receive an interim comprehensive income tax notice, you can check the notified amount and make a payment through Hometax or Sontax, the NTS's online and mobile tax services in South Korea.
On Hometax, log in and access the tax payment section under the Payment, Notices, and Refunds menu. You can view the tax amount stated in the notice and select the item classified as tax assessed by notice to make a payment.
For taxpayers eligible for installment payments, the NTS provides instructions for entering and paying only the amount due in November.
For example, if your tax bill is KRW 15 million and you intend to pay KRW 5 million in installments, you can pay KRW 10 million by the initial payment deadline.
You may also use the virtual bank account or national tax payment account listed on your tax notice.
Business owners intending to file an estimated interim tax return must prepare the estimated interim tax return separately from checking the amount stated in the tax notice. They should also verify the supporting calculations for their comprehensive income during the first half of 2026.
In particular, taxpayers who do not meet the estimated filing requirements must not arbitrarily pay an amount lower than the notified tax bill.
Who Is Exempt From Interim Comprehensive Income Tax Payments?
Not every self-employed business owner in South Korea receives an interim tax notice in November.
According to NTS guidance, certain categories are excluded from interim payment requirements, including newly established businesses, certain taxpayers who have suspended or closed their businesses, and individuals who receive only specified types of income.
For example, a person who was not operating a businessbut started a new business in 2026 falls within the exclusion criteria for new business operators.
Individuals who suspended or closed their businesses before June 30, 2026, are also excluded. Those who closed their businesses after June 30 must check the separate applicable conditions.
People receiving only certain types of income, such as employment income or interest and dividend income, may also be excluded from interim payment requirements.
Having a business registration does not automatically mean that a taxpayer is subject to interim tax payments. Conversely, not receiving a tax notice does not necessarily mean there is no payment obligation.
What Business Owners Should Check Before November 30, 2026
If you are a self-employed business owner facing a burdensome interim tax bill, first check the interim payment base amount and the notified tax amount.
Next, organize your sales and expenses from January through June 2026 and calculate your comprehensive income for the first half of the year.
Check whether the estimated interim tax amount is less than 30% of the interim payment base amount. If you meet the requirements, prepare the estimated interim tax return.
If you do not qualify for estimated filing, check whether the notified tax amount exceeds KRW 10 million and calculate the amount eligible for installment payments.
November 30, 2026, is both the ordinary interim tax payment deadline and the deadline for filing and paying estimated interim tax.
A decline in sales this year does not automatically adjust your tax liability. It is important to calculate first-half income and estimated tax accurately and complete any required filing within the deadline.
*Note: This article is provided for reference to help readers understand market trends. It is not an investment recommendation concerning any particular security or asset. Final investment decisions and responsibility rest with the individual.*