Travel Reference
In-Depth Information
a wire transfer that will arrive in the recipient's account in one or two business days. Fees
tend to be lower for online remittances or accounts specifically set up for the purpose.
Foreign nationals are required to nominate a “primary” foreign exchange bank for any
remittances abroad—this will by default be the first bank you wire funds overseas from.
Remitting money from another branch of the same bank is fine, but if you want to send
funds home from another bank altogether, you'll have to fill out a form to “switch” your
designated foreign exchange institution—not a massive inconvenience, but another layer of
paperwork.
Rules and restrictions on remittances can vary widely among banks, branches, and tell-
ers. If you're dealing with a bank that insists on tight limits or wants to stamp your passport
every time you send funds overseas (not unheard of), it's time to follow up with the bank's
customer service center or seek out a more amenable place.
There are few restrictions on receiving money wired from abroad, but banks must report
any remittances worth over US$10,000 to the tax authorities, and will sometimes require
you to contact your branch before releasing funds.
Taxes
SOUTH KOREAN TAXES
As in most countries, South Korea's tax system is a complex, shifting beast, but it's also
highly modernized and fair, and some efforts have been made to unravel its mysteries for
expatriates. Residents of South Korea—generally defined as anyone who works here or
who has lived in the country for a year or more—are subject to tax on income they earn loc-
ally, as well as most international income that happens to be reported to the tax authorities
(a process that more than a few foreign taxpayers avoid for obvious reasons).
South Korea has a progressive tax rate that begins at 6 percent for annual earnings of
12 million won or less and tops out at 38 percent on earnings of 300 million won per year
or more, plus a 10 percent surcharge on total tax liability. This is complemented with a
rather generous array of deductions and exclusions for everything from credit card spend-
ing (which the government wants to encourage because it makes purchases and hence sales
tax easier to track) to transportation, charitable, educational, and medical expenses. Foreign
nationals will usually be given the option of forgoing all deductions in exchange for their
income being taxed at a preferential flat rate of 15 percent, which can represent a better deal
for those with limited spending or no dependents.
 
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