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 an indirect tax levied on the value added when a business supplies goods or services. Korea's standard VAT rate is 10%, with different filing methods for general taxpayers, simple taxpayers, and tax-exempt businesses. General taxpayers pay the difference between output VAT (10% of sales) and input VAT (VAT paid on purchases). Qualifying evidence (tax invoice, credit card sales slip, cash receipt, etc.) is required to claim input VAT credit. If input VAT exceeds output VAT, a refund is available. Simple taxpayer status is available for businesses with annual revenue under KRW 104M (2026). Tax is calculated as revenue × industry-specific value-added ratio (15–40%) × 10%, and only partial input VAT credit is allowed. Annual revenue under KRW 48M is exempt from payment (filing is still required). This calculator simulates a standard general-taxpayer case. Special items such as deemed input VAT credit, credit-card-issuance credit, and zero-rated exports are not reflected. General taxpayers file twice (January and July); simple taxpayers file once (January).
When is this calculator useful?
Pre-launch VAT burden estimate
Estimate quarterly VAT based on projected revenue and purchases — essential for cash-flow planning.
General vs. simple taxpayer comparison
Businesses with revenue under KRW 104M can choose simple taxpayer status. General is often better with high purchases; simple is often better with low purchases.
Freelancer VAT filing
Freelancers with business registration must file VAT quarterly. Use this calculator to estimate the payment.
Refund possibility review
Temporary excess input VAT (large equipment or inventory purchases before revenue) can be refunded. Estimate the refund amount.
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
How to read the result
The result is composed of: • Sales (supply value): excluding VAT. • Output VAT: sales × 10%. • Purchases (supply value): excluding VAT. • Input VAT: purchases × 10% (creditable with qualifying evidence). • Payable: output − input. Negative payable means a refund. Simple taxpayers use a separate formula. General taxpayers file in January (prior H2) and July (current H1).
Things to keep in mind
- This calculator targets general taxpayers. Simple taxpayers use industry-specific value-added ratio × revenue × 10% — calculated separately.
- Input VAT credit requires qualifying evidence (tax invoice, credit card sales slip, cash receipt, etc.) at the time of purchase. Plain receipts are not creditable.
- Exports are zero-rated (0%) and input VAT is refundable. This calculator assumes domestic transactions — exporters need separate calculation.
- Some industries (food, accommodation) can apply deemed input VAT credit (agricultural purchases). Not reflected in this calculator.
- Businesses with high credit-card sales (revenue under KRW 1B) can claim a credit-card-issuance credit (1–1.3% of credit-card sales). Not reflected.
- Missing the VAT filing deadline incurs a 20% non-filing penalty plus late-payment interest. Stick to the quarterly schedule.
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.
- What is the difference between general and simple taxpayers?
- General taxpayers charge 10% as output VAT and deduct input VAT — the standard method. Simple taxpayer status is available only for businesses with annual revenue under KRW 104M, using an industry-specific value-added ratio (15–40%) for a simplified calculation. General is often better with high purchases; simple with low purchases.
- How do I claim input VAT credit?
- Obtain a tax invoice (issued by the supplier) or pay via credit card / cash receipt to secure qualifying evidence. The input VAT is deducted from output VAT in the next filing. Plain or simplified receipts are not creditable.
- When are VAT returns filed?
- General taxpayers: January (prior July–December) and July (current January–June), twice a year. Simple taxpayers: once in January. There are also preliminary filings in April and October, so effectively quarterly management is needed.
- What is not reflected in this calculator?
- Zero-rated exports, deemed input VAT credit (agricultural purchases), credit-card-issuance credit, exempt sales, and the simple taxpayer formula are not reflected. Consult a tax accountant for complex cases.
Official Sources
Always verify with the official sources below