VAT Calculator
Enter sales, purchases, and taxpayer type to compute Korean VAT payable or refund instantly.
Total sales for the filing period, excluding VAT.
Total business purchases excluding VAT, supported by tax invoices.
VAT payable
4,000,000KRW
- Sales VAT
- 10,000,000KRW
- Purchase deduction
- 6,000,000KRW×10%
- Effective rate vs sales
- 4.00%
- General taxpayer: sales VAT (10%) − purchase VAT (10%)
What is Korean VAT?
Value-Added Tax (VAT) is levied on the value added by businesses when supplying goods and services. The standard rate is 10%. General taxpayers pay sales VAT minus deductible purchase VAT. Businesses with prior-year sales under 80,000,000 KRW qualify as simplified taxpayers, who apply industry value-add rates (15–40%) for a lower effective burden. Sales under 48,000,000 KRW are exempt from VAT payment (filing still required).
Simplified taxpayer industry rates
| Industry | Value-add rate | Effective rate |
|---|---|---|
| Retail / Food service (15%) | 15% | 1.5% |
| Manufacturing / Agriculture (20%) | 20% | 2.0% |
| Construction / Transport / IT (30%) | 30% | 3.0% |
| Finance / Real-estate rental / Other services (40%) | 40% | 4.0% |
Key thresholds
- Simplified taxpayer ceiling: 80,000,000 KRW
- VAT payment exemption ceiling: 48,000,000 KRW
Frequently asked questions
- General vs simplified taxpayer?
- Prior-year sales under 80M KRW means simplified; otherwise general. General taxpayers pay 10% on sales minus 10% on deductible purchases. Simplified taxpayers apply a 15–40% industry value-add rate × 10%, but cannot claim refunds and only get a 0.5% purchase deduction.
- How are purchase VAT deductions claimed?
- Only purchases with proper tax invoices, credit-card slips, or cash-receipt documentation count. Plain receipts do not qualify for general taxpayers; simplified taxpayers also receive only a partial deduction. Personal expenditures are not deductible.
- When is VAT filed?
- General individual taxpayers file twice a year (January and July) for the previous half. Corporations file quarterly. Simplified taxpayers file once in January. Late filing triggers penalties — meet the deadlines.
- What is not modeled here?
- Credit-card sales VAT credit, deemed purchase VAT credit, food/lodging agricultural deemed purchase credit, exempt sales separation, and penalties are simplified away. Use Hometax's auto-calculation or a tax accountant for the actual filing.
Reference only. Implements only the basic VAT formula. Credit-card sales VAT credit, deemed purchase VAT credit, exempt-sales separation, food/lodging agricultural deemed purchase credit, and penalties are not modeled. Sales and purchases are entered as supply value (excluding VAT) — entering VAT-inclusive amounts produces wrong results. Use Hometax or a tax accountant for actual filings.