Korea's Earned Income and Child Tax Credits: Rules and Timing

What the two payments are

Korea's earned income tax credit, officially the work incentive payment (geullo jangryeogeum), is cash the National Tax Service pays to households that work but earn little, so that working more raises income. It is based on the Restriction of Special Taxation Act and, unlike a tax refund, can be received even if you paid no tax. Households with business income or religious workers' income, not only wage income, can qualify. The child incentive payment (janyeo jangryeogeum) goes to low-income households with dependent children under 18, according to the number of children, and households meeting both sets of requirements can receive both. Both are judged on the previous year's income and on assets as of 1 June of that year, so payments applied for in 2026 are based on 2025 income. This article uses 2025 income and 2026 applications as its basis. Limits and amounts change often through tax law amendments, so check the National Tax Service's guidance every year.

Household types and income limits

Income limits differ by household type. A single household has no spouse, no dependent children and no supported parent aged 70 or over. A one-earner household has a spouse, dependent child or supported parent aged 70 or over, and the spouse earns less than a set amount (currently KRW 3 million); a dual-earner household is one where both spouses earn more than that. For 2025 income, the couple's combined total income must be under KRW 22 million for single households, KRW 32 million for one-earner households and KRW 44 million for dual-earner households. The child payment requires dependent children under 18 in a one- or dual-earner household with combined total income under KRW 70 million. Total income includes wages, business income, interest, dividends and pensions, with business income counted after multiplying by an industry-specific ratio. Amendments raising the limits are sometimes discussed, so check the rules for the year you apply.

• Single household: total income under KRW 22 million (2025 income)
• One-earner household: under KRW 32 million
• Dual-earner household: under KRW 44 million
• Child payment: children under 18, combined income under KRW 70 million

The asset test and how much you can get

Even within the income limit, you cannot receive the payment if your assets are too large. For 2025 income, the total assets of all household members as of 1 June that year must be under KRW 240 million, and if they are KRW 170 million or more only 50% of the calculated amount is paid. Assets include homes, land and buildings, cars, rental deposits such as jeonse (lump-sum lease) deposits, and financial assets such as savings and shares; importantly, debts are not subtracted. If you bought a home with a loan, assets may be counted far above your actual net worth. The amount rises with income in a first band, stays at the maximum in a middle band, then falls as income increases. For 2025 income the maximum work payment is KRW 1.65 million for single households, KRW 2.85 million for one-earner households and KRW 3.3 million for dual-earner households; the child payment is KRW 500,000 to 1 million per child. Hometax, the National Tax Service's online portal, has a calculator for exact amounts.

• Assets under KRW 240 million (as of 1 June; debts not subtracted)
• 50% paid if assets are KRW 170 million or more
• Maximum work payment: single 1.65M, one earner 2.85M, dual 3.3M
• Child payment: KRW 500,000 to 1 million per child

A worked example

The following is an assumption to show the structure. A one-earner household has a spouse and one primary school child, and the couple's combined total income for 2025 was KRW 25 million. That is under the KRW 32 million one-earner limit, so the household qualifies for the work payment, and with a child under 18 and income under KRW 70 million it also qualifies for the child payment. Assume the Hometax calculator shows a work payment of KRW 1.4 million and a child payment of KRW 800,000. If household assets total KRW 150 million, the household receives KRW 2.2 million with no reduction. If assets are KRW 200 million, which is KRW 170 million or more, each payment is halved, giving KRW 1.1 million. If the household also missed the regular period and applied late, only 95% of that is paid, about KRW 1,045,000. The calculated amounts above are assumptions for illustration; actual amounts depend on the formula for each income band and other requirements.

When and how to apply

The regular application is made every May; for 2025 income it ran from 1 May to 1 June 2026. Households with only wage income can also apply by half-year, applying in September for first-half income and in March of the following year for second-half income, and receiving the payment in parts. If you completed half-year applications, you do not need to apply again in May. If you miss the regular period you can still apply late during the following six months, but only 95% of the calculated amount is paid. The National Tax Service sends notices or text messages to households that appear eligible, and you can apply on Hometax, its mobile app Sontax, or the automated phone line using the personal code on the notice. Once you consent, automatic application in later years is also possible. Importantly, if you meet the requirements you can apply directly on Hometax even without a notice. Regular applications are usually paid in late summer after review.

• Regular: every May (2025 income: 1 May to 1 June 2026)
• Half-year (wage income only): September and the following March
• Late: within six months after the regular period, 95% paid
• No notice needed if you meet the requirements

Misconceptions and impersonation scams

Many people think only taxpayers can receive the work payment, but eligibility is judged on income and assets regardless of tax paid. Others miss out because they believe they can only apply after receiving a notice. The biggest thing to watch for is impersonation texts and calls that use the payments as bait. The National Tax Service never asks for fees, money transfers or account passwords in connection with these payments. Getting you to tap a link and install an app or enter personal data is also a typical trick, so apply and check results by going to Hometax or Sontax directly. Frequent misconceptions include the following.

• 'Only taxpayers qualify' — eligibility depends on income and assets
• 'You need a notice to apply' — you can apply directly if eligible
• 'Debts are subtracted from assets' — they are not
• 'Pay a fee to get paid faster' — the tax service never asks for fees or transfers

A checklist before applying

Checking in this order gives a rough idea of whether you qualify and how much. First, decide your household type: whether you have a spouse, dependent children or a supported parent aged 70 or over, and whether your spouse earns under the threshold, determines single, one-earner or dual-earner status. Next, confirm the couple's combined total income for the previous year, using withholding receipts for wages and payment statements and income tax returns for business income. Then add up all assets as of 1 June that year: include your home, car, rental deposit and savings, and do not subtract debts. Finally, check the expected amount with the Hometax calculator and apply within the regular period. Entering a payment account correctly in your own name avoids delays.

• Decide the household type
• Confirm the previous year's combined total income
• Add up assets as of 1 June (no debt deduction)
• Estimate the amount with the Hometax calculator
• Apply on time with an account in your own name

Frequent case 1: no notice arrived, or you missed the deadline

The National Tax Service sends notices to households that its data suggests may qualify, so changes of job or address, or missing data, can mean you never receive one. If you meet the requirements, simply apply directly on Hometax or Sontax. If you missed the regular period, you can apply during the late application period; apart from the 5% reduction and later payment than regular applications there is no other penalty. If the late period has also passed, that year's payment is lost, so note the regular and half-year dates for the following year. Consenting to automatic application may mean you do not need to apply separately in years when you qualify. You can check application results and expected payment dates on Hometax, Sontax or the automated phone line, and if you disagree with the review result you can contest it through the set procedure.

Frequent case 2: you are a freelancer or self-employed

Freelancers and self-employed people with business income can also qualify for both payments. However, business income is not counted at its full revenue; it is multiplied by an adjustment ratio set for each industry to obtain total income. The same revenue can therefore fall inside or outside the limit depending on your industry. If you have business income you cannot use half-year applications and must apply in the regular May period. May is also the comprehensive income tax filing period, but applying for the payment and filing your income tax return are separate procedures, so you need to do both. If you do not file your tax return, your income data may be incomplete, which can delay the review or change the amount. Some groups, such as licensed professional businesses, are excluded by law, so check the industry ratios and exclusions in the National Tax Service's guidance. If your income fluctuates, reassess the requirements each year.

Limits and disclaimer

This article explains the general structure of Korea's work and child incentive payments on the basis of 2025 income and 2026 applications. Income limits by household type, the asset test, maximum amounts and application periods can change with tax law, and even when an amendment raising the limits is announced, the year it actually applies depends on parliamentary approval and the effective date. The calculation example is an assumption to show the structure and differs from actual payments. Before applying, check the incentive guidance on Hometax, the National Tax Service's tax consultation centre, and the text of the Restriction of Special Taxation Act on the National Law Information Center. This article is general information setting out criteria, not tax advice. Any contact asking for fees, transfers or passwords in the name of these payments is an impersonation scam; do not respond, and confirm directly with the National Tax Service.