Korea’s higher pension account credit limits and household contribution capacity
Distinguish the higher credit-eligible limits under the tax amendment from what households can afford to contribute.
Updated Nov 7, 2026
The change to eligible contribution limits
The Income Tax Act amendment effective 2023-01-01 set an annual credit-eligible limit of KRW 6,000,000 for pension savings and a combined limit of KRW 9,000,000 including retirement pension accounts. These limits apply to eligible contributions.
Credit limits and affordable contributions
A higher credit-eligible limit does not increase a household’s emergency cash or ability to fund a rental deposit. When setting contributions, assess whether enough cash will remain for near-term needs separately from the tax benefit.
Tax savings and investment returns are separate
The actual credit depends on the applicable rate, individual tax liability, the source of contributions and other conditions. Reaching the limit does not determine investment returns or how much can be withdrawn when needed.
Sources
- Korean Law Information Center | Income Tax Act pension account amendmentAccessed Nov 7, 2026
- National Tax Service | Pension account tax creditAccessed Nov 7, 2026