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Korea Severance Pay Calculator

Find out what your employer owes you when you leave, and what tax takes out of it.

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How the number is built

  1. 1
    Bonuses and annual leave pay, scaled to three months(bonuses + annual leave pay, last 12 months) × 3/12
  2. 2
    Average daily wage(pay over your last 3 months + the amount above) ÷ days in that period
  3. 3
    Gross severanceaverage daily wage × days of service ÷ 365 × 30
Severance payseverance pay=average daily wage×30 days×(days of service÷365)
LineWhat it is
Average wageTotal pay over your last three months divided by the days in that period. It runs a little above ordinary wage because bonuses and annual leave pay feed into it.
Retirement income taxLighter than tax on ordinary income, because a service-length deduction shrinks the taxable base.
Local income taxA flat 10% of the retirement income tax figure.

This is an estimate. Your employer runs the final settlement, and company definitions of average wage vary.

Severance pay starts at one full year of service. At 364 days the figure is zero, not smaller.
National Tax Service - retirement income tax simulatorLost the job rather than left it? Check your unemployment benefits

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Three tests, and none of them ask your nationality

TestWhat it meansWho it covers
One full year365 days or more of continuous service with the same employerA day short is a day short, which is why leaving dates get negotiated
15 hours a weekAveraged over four weeks, not judged week by weekShort-hours jobs can pass this
Your visaThe Act sets no nationality test and no visa testEvery status that lets you work in Korea

Fewer hours lower the amount, not the right. Part-time, contract and full-time are treated alike.

Two roads your severance can take

Most visas (E-7, D-8, F-series, part-time)E-9 and H-2 (EPS)
Who holds the moneyYour employer, or a DB, DC or IRP retirement planAn insurer, through departure guarantee insurance (출국만기보험)
What releases itYour leaving dateThe day you leave Korea
Where it landsA Korean account, or an IRP accountThe account you registered with the insurer
If the payout falls shortNot applicableYour employer owes you the difference

For E-9 and H-2 the insurance is the floor, not the ceiling. Compare the payout with the figure this calculator gives you.

Return cost insurance is a different pot of money, paid for out of your own pocket. It is not your severance.

The 14-day clock

  1. 1
    Your leaving dateThe clock starts here for everyone except E-9 and H-2 workers, whose clock runs off their departure instead.
  2. 2
    Within 14 daysSeverance is due. You and your employer can agree in writing to push the date back, but silence is not an agreement.
  3. 3
    After 14 daysUnpaid severance carries statutory delay interest until it is settled.
  4. 4
    If nothing arrivesCall the Ministry of Employment and Labor on 1350. Unpaid severance is a labor complaint, not a private dispute.

Leaving Korea for good

WhenWhat to sort out
Before your last dayGet it in writing: how severance will be paid, on what date, and into which account.
Retirement plan moneyDB and DC balances usually move into an IRP account. Ask your employer whether a departing resident can be paid directly instead.
E-9 and H-2Departure guarantee insurance is claimed around your departure, so keep your account and contact details live.
Your bank accountClosing it before the money lands is the most expensive mistake on this list.

Nothing here is a visa question. For anything about your residence status, the immigration contact center is 1345.

FAQ ❓

Yes. The Employee Retirement Benefit Security Act ties severance to how long and how many hours you worked, not to nationality or visa. If you averaged 15 hours a week or more and stayed one full year with the same employer, you qualify the same way a Korean colleague does.
No. Severance starts at 365 days of continuous service, and a day short is a day short. This is why leaving dates get negotiated in Korea - the difference between 364 and 365 days is a full month of pay.
It is in departure guarantee insurance. For E-9 and H-2 workers your employer pays into an insurance policy each month instead of holding the money, and it is released when you leave Korea rather than on your last day at work. If the policy pays out less than the statutory severance, your employer owes you the difference.
For E-9 and H-2 workers, leaving is exactly what triggers the insurance payout. On other visas the money is due within 14 days of leaving the job, so settle it before you go and keep a Korean account open if you can. Ask the Employment and Labor counselling line on 1350 if your employer has gone quiet.
Splitting statutory severance into monthly salary is not how the Act works, and clauses like that have repeatedly been treated as invalid. If you see one, raise it with the Ministry of Employment and Labor rather than assuming you have signed the money away.
Yes, if you averaged 15 hours a week over four weeks and stayed a full year. Part-time, contract and full-time are treated the same here. Working fewer hours lowers the amount, not the right.
Retirement income tax, plus a local income tax worth 10% of it. It is far lighter than tax on ordinary income because a service-length deduction shrinks the taxable base, which is why a long stay is taxed gently. This calculator estimates it before your employer's final settlement.

Sources 🌐