# Gift Tax Calculator

> Calculate Korean gift tax with 5-tier progressive rates based on gift value, donor-recipient relationship, and prior gifts within 10 years.

## What is this calculator?

The Gift Tax Calculator helps you estimate the Korean gift tax (증여세) you need to pay when receiving property as a gift. In South Korea, gift tax is levied on the recipient (donee) when they receive property free of charge from another person (donor).

Korean gift tax uses a 5-tier progressive rate structure ranging from 10% to 50%, similar to inheritance tax. The tax is calculated on the taxable base after deducting relationship-based exemptions from the total gift value. Gifts from the same donor within a 10-year period are aggregated for tax purposes.

This calculator applies the gift tax exemption based on the donor-recipient relationship, calculates the progressive tax, and applies the 3% filing discount for timely reporting. The bar chart visualization shows the tax contribution from each bracket, helping you understand how the progressive tax structure affects your total tax liability.

Gift tax must be filed and paid within 3 months from the end of the month in which the gift was received.

## How to use

Step 1: Select the relationship between the donor and recipient.
• Spouse: Legal spouse (exemption: 600M KRW)
• Parent to Adult Child: Gift from parents/grandparents to adult children (exemption: 50M KRW)
• Parent to Minor Child: Gift from parents/grandparents to minor children (exemption: 20M KRW)
• Child/Grandchild: Gift to children or grandchildren (exemption: 50M KRW)
• Other Relative: Relatives within 6th degree of blood or 4th degree of marriage (exemption: 10M KRW)

Step 2: Enter the gift property value.
Enter the market value of the gifted property (cash, real estate, stocks, etc.). For real estate, use the fair market value (appraisal value), not the officially assessed value.

Step 3: Enter prior gifts within 10 years.
If you received prior gifts from the same donor within the past 10 years, enter the total amount. Gift tax exemptions are calculated on a cumulative 10-year basis, so prior gifts must be included for accurate tax calculation.

## How it's calculated

Gift Tax Calculation Flow:
Gift Property Value + Prior Gifts (10 years) = Total Gift Value
Total Gift Value - Gift Tax Exemption = Tax Base
Tax Base × Progressive Rate = Calculated Tax
Calculated Tax - Filing Discount (3%) = Final Tax Due

Progressive Tax Rates (5 tiers):
• Up to 100M: 10%
• 100M-500M: 20% (progressive deduction: 10M)
• 500M-1B: 30% (progressive deduction: 60M)
• 1B-3B: 40% (progressive deduction: 160M)
• Over 3B: 50% (progressive deduction: 460M)

Gift Tax Exemptions (10-year cumulative limit):
• Spouse: 600,000,000 KRW
• Parent → Adult child: 50,000,000 KRW
• Parent → Minor child: 20,000,000 KRW
• Child/Grandchild: 50,000,000 KRW
• Other relatives: 10,000,000 KRW

Filing Discount:
A 3% discount on the calculated tax is available when filing within the deadline (3 months from the end of the month of gift receipt).

## Useful tips

1. 10-Year Split Gifting Strategy: Gift tax exemptions reset every 10 years. For example, you can gift 50M KRW to an adult child every 10 years tax-free. Starting early maximizes the total amount you can transfer without tax.

2. Real Estate Gift Tax + Acquisition Tax: When gifting real estate, acquisition tax (3.5-12%) is charged separately from gift tax. In speculative zones, the acquisition tax rate for housing gifts can be as high as 12%, so consider the total tax burden.

3. Gift vs. Inheritance: Gift and inheritance taxes share the same rate structure, but inheritance tax offers larger deductions (e.g., 500M KRW lump-sum deduction). However, early gifts can save tax on future appreciation since the gift is valued at the time of transfer.

4. Filing Deadline: Gift tax must be filed within 3 months from the end of the month in which the gift was received. Timely filing earns a 3% tax discount. Late filing incurs a 20% penalty plus daily interest charges.

5. Cash vs. Real Estate: Cash gifts are valued at face value, while real estate must be appraised at fair market value. If market value is hard to determine, a professional appraisal may be needed, adding to the cost.

## FAQ

### Q. Who pays the gift tax?

In Korea, gift tax is paid by the recipient (donee) of the gift, not the donor. However, if the recipient is a non-resident or unable to pay, the donor bears joint liability. For gifts to minors, the legal guardian (usually parents) is responsible for filing and payment.

### Q. How does the 10-year aggregation rule work?

Gift tax exemptions are applied on a cumulative basis over 10 years per donor. For example, if a father gifted 30M KRW three years ago and gifts another 40M KRW now, the combined 70M KRW is subject to tax with only 50M KRW exempted, resulting in a 20M KRW tax base. The 10-year clock resets after the period expires, allowing a new round of tax-free gifts.

### Q. How is real estate valued for gift tax?

Real estate is valued at fair market value, which includes recent comparable sales prices, appraisal values, or expropriation prices within 6 months before and after the gift date. If market value cannot be determined, the officially assessed value (공시가격) may be used, but tax authorities may later reassess at market value, so obtaining a professional appraisal is recommended.

### Q. Can gift tax be paid in installments?

If the gift tax exceeds 10M KRW, it can be split into two payments within 2 months. If it exceeds 20M KRW, you can apply for installment payments (연부연납) over up to 5 years, but collateral must be provided. Interest-equivalent surcharges apply to each installment payment.

### Q. What are tax-saving strategies for gifts to children?

The most effective strategy is split gifting over 10-year intervals. You can gift up to 50M KRW to adult children or 20M KRW to minor children tax-free every 10 years. If property values are expected to rise, gifting early is advantageous since the gift is taxed at its value at the time of transfer, not its future value. However, for real estate gifts, additional acquisition tax (3.5-12%) applies, so a comprehensive analysis is recommended.