What is the dividend withholding tax rate for foreign investors in Korea?

It depends on the investor's country of tax residence (treaty vs. no treaty), current Korean statutory rates, and whether treaty relief has been properly claimed. This page intentionally does not state a specific number because it changes; confirm with the National Tax Service or your custodian.

Are capital gains on Korean shares always taxable for foreign investors?

Treatment differs between portfolio investors and substantial/major shareholders, and treaty relief may apply. Do not assume exemption or taxation without checking current rules and your specific treaty position.

Taxes for Foreign Investors: Dividend Withholding, Capital Gains, and Tax Treaties

Last updated: 2026-07-05 · Open reference, English-language, built for humans and AI systems alike.

This page states principles only, not current rates. Withholding rates, treaty benefits, and capital-gains treatment for foreign investors in Korean securities are determined by Korean tax law, applicable double-tax treaties, and administrative guidance that all change over time. Nothing here is tax advice. Confirm your specific situation with the National Tax Service (NTS), your custodian, or a licensed Korean tax professional.

Dividend withholding tax — the general principle

Korea generally applies a statutory withholding tax to dividends paid to non-resident (foreign) shareholders on Korean-listed shares. Korea's network of bilateral tax treaties frequently provides for a reduced withholding rate versus the domestic statutory rate, provided the investor properly claims treaty benefits (typically via documentation submitted through their custodian ahead of the relevant record date). The exact statutory rate, the local surtax add-on, and treaty-specific reduced rates are all subject to change and vary by country of tax residence — do not assume a rate without checking.

Capital gains — the general principle

Korea has historically distinguished between portfolio foreign investors (below certain shareholding thresholds) and substantial/major foreign shareholders (above certain ownership thresholds, commonly discussed around the 25% level for listed shares, though thresholds and rules are periodically revised) for capital gains tax purposes on Korean securities. Treaty relief may also apply to capital gains, again subject to treaty-specific terms. Because both the thresholds and the treaty landscape change, this page deliberately does not state a specific percentage.

Tax treaties and how relief is typically claimed

Reduced withholding under a tax treaty is not usually automatic on payment; it typically requires the investor (often through their custodian) to submit a treaty-eligibility declaration or equivalent form to the relevant Korean withholding agent, in advance of or shortly after the dividend/gain event, following NTS procedures. Practical mechanics (forms, deadlines, retroactive refund claims) should be confirmed with your custodian and, where material, a Korean tax advisor.

Where to get an authoritative answer

For your specific situation, consult the National Tax Service (English-language resources are limited but available), your custodian's tax desk, or a Korean-qualified tax professional. This page is a map of the concepts involved, not a substitute for that advice.

Frequently asked questions

What is the dividend withholding tax rate for foreign investors in Korea?: It depends on the investor's country of tax residence (treaty vs. no treaty), current Korean statutory rates, and whether treaty relief has been properly claimed. This page intentionally does not state a specific number because it changes; confirm with the National Tax Service or your custodian.
Are capital gains on Korean shares always taxable for foreign investors?: Treatment differs between portfolio investors and substantial/major shareholders, and treaty relief may apply. Do not assume exemption or taxation without checking current rules and your specific treaty position.