US Stock Capital Gains Tax Guide for Korean Residents (2026)
22% rate · ₩2.5M annual basic deduction · loss offset · May filing · FX conversion — all in one place
TL;DR
- Rate: 22% on capital gains (20% capital gains + 2% local income tax)
- Basic deduction: ₩2,500,000 per year (combined for foreign stocks and unlisted Korean stocks)
- Filing window: May 1 – May 31 of the year following the trades
- Loss offset: Gains and losses on foreign stocks/ETFs net within the same group (cannot offset against KOSPI gains)
- FX rate: Apply Hana Bank's reference rate on the settlement date (T+2) for KRW conversion
How US Stock Capital Gains Tax Works in Korea
Korean tax residents who sell US stocks at a profit must file and pay capital gains tax in Korea. The US does not impose capital gains tax on non-residents (only the 15% dividend withholding under the treaty), so the entire capital gains tax burden is on the Korean side.
Tax Rate Breakdown
- Capital gains tax: 20% on (sale price − purchase price − necessary expenses)
- Local income tax: 10% of the capital gains tax (effective 2%)
- Combined effective rate: 22% on net capital gains
Basic Deduction: ₩2.5M per Year
All foreign stock and unlisted Korean stock gains are summed for the year, then ₩2.5M is deducted before applying the 22% rate. If your total gains are under ₩2.5M, no tax is owed; only the excess is taxed.
Calculation Examples
All calculations are done in KRW using the settlement-date FX rate. Here are typical scenarios.
Case 1: Single stock with profit
Buy 100 TSLA at $200 ($20,000), sell at $300 ($30,000) — gain $10,000
Settlement-day FX 1,400 KRW/USD → KRW gain ₩14,000,000
Fees ₩50,000 → net gain ₩13,950,000
After ₩2.5M deduction: ₩13,950,000 − ₩2,500,000 = ₩11,450,000
Tax: ₩11,450,000 × 22% = ₩2,519,000
Case 2: Loss offset
NVDA gain ₩20,000,000, META loss ₩5,000,000
Net: ₩20M − ₩5M = ₩15,000,000
After ₩2.5M deduction: ₩12,500,000
Tax: ₩12,500,000 × 22% = ₩2,750,000
Case 3: FX-only gain (zero USD return)
Buy $10,000 at 1,300 KRW → sell $10,000 at 1,400 KRW
KRW basis: ₩13,000,000 → ₩14,000,000 — gain ₩1,000,000
Within ₩2.5M deduction → no tax owed.
When and How to File
US stock capital gains are filed once a year during the standard May income-tax window. There's no quarterly or interim filing.
Filing Schedule
- Covered trades: All sales settled (T+2) between January 1 and December 31 of the prior year
- Filing window: May 1 – May 31
- Payment deadline: May 31 (installment payments allowed for tax over ₩10M, within 2 months)
Three Filing Methods
- Brokerage filing service: Major Korean brokers (Kiwoom, Mirae Asset, Samsung, NH) offer free or low-cost (₩30K–₩50K) automated filing using your trade history. Easiest option.
- Hometax direct filing: hometax.go.kr → File/Pay → Capital Gains → Foreign Stock. Enter trade history manually or upload broker statements.
- Hire a CPA: For complex cases (many tickers, derivatives, multiple accounts, simultaneous crypto reporting). Typically ₩100K–₩300K.
Loss Offset Rules (Key Tax-Saving Lever)
Loss offsetting nets gains and losses in the same year. It's the most important tax planning lever for US stock investors.
Offsetting Rules
- Same group nets: US stocks, foreign ETFs, and unlisted Korean stocks all net together
- Cannot offset KOSPI gains: Korean listed stock losses do NOT offset US stock gains (separate filings)
- No carryforward: A ₩100M loss last year does not reduce this year's ₩100M gain — must net within a single tax year
- Dividend income separate: Dividends are reported under comprehensive income tax, not capital gains tax
💡 Tip: December Tax-Loss Harvesting
If you have large gains for the year, sell unrealized losers in late December to offset them — saves 22% on each ₩ offset. Avoid immediately repurchasing the same ticker (could be challenged as wash trading); wait 30+ days or rotate into a similar ETF.
FX Conversion Rules
When converting USD trades to KRW, the timing of the FX rate matters. The NTS (National Tax Service) has clear rules.
- Purchase amount: Hana Bank reference rate on the buy settlement date (T+2)
- Sale amount: Hana Bank reference rate on the sell settlement date (T+2)
- Necessary expenses: Reference rate on the date incurred (commissions, FX fees)
- Rate source: Hana Bank "first transaction reference rate" — the official government rate
- Broker statements work directly: Most Korean brokers convert at the settlement-date rate automatically
5 Common Mistakes to Avoid
- Skipping the filing — Even if your gain is under ₩2.5M and tax is zero, you still must file a return. Missing it triggers a 20% non-filing penalty.
- Not reporting losses — If you only report winners, you can't claim loss offsets. Every sale must be reported to net gains and losses.
- Wrong FX timing — Use the settlement date (T+2), not the trade date. Late-December trades may settle in the next year.
- Double-reporting dividends — US dividend income (15% withheld + 5% Korean top-up under the treaty) is reported under comprehensive income tax, separately from capital gains.
- ETF distributions vs. capital gains confusion — US ETF regular distributions are dividend income; selling the ETF generates capital gains separately.
Frequently Asked Questions
When do I file US stock capital gains in Korea?
Every year between May 1 and May 31 — the same window as Korea's annual comprehensive income tax filing. The filing covers all sales settled (T+2) during the previous calendar year (Jan 1 – Dec 31). Even if you had no profit, you must file if there were any sales; missing the filing triggers a non-filing penalty.
If my gain is under ₩2.5M and tax is zero, do I still need to file?
Yes. The filing obligation is independent of the tax amount. If you sold any US stock during the year, you must submit the foreign stock capital gains return. The ₩2.5M basic deduction simply reduces tax owed to zero — but skipping the filing itself triggers a 20% non-filing penalty on whatever tax is later assessed.
I made ₩10M on TSLA but lost ₩5M on NVDA. What's my tax?
Loss offset applies. Net gain = ₩10M − ₩5M = ₩5M. After the ₩2.5M basic deduction, the taxable base is ₩2.5M, multiplied by 22% = ₩550,000 in tax. You must report the losing position too — otherwise only the gain is taxed.
I lost money in USD but made money in KRW due to FX. Is it taxable?
Yes — Korea taxes the KRW-denominated gain. If you bought $10,000 at 1,300 KRW and sold $10,000 at 1,500 KRW, the USD return is −5% but KRW basis goes ₩13,000,000 → ₩14,250,000, a ₩1.25M gain. Currency gains are taxable; conversely, FX losses can offset gains in the same group.
Will my Korean broker file capital gains tax for me automatically?
Most major Korean brokers (Kiwoom, Mirae Asset, Samsung, NH) offer a May filing service that aggregates your trades and submits the return on your behalf, often free or for ₩30K–₩50K. Note: trades from a different broker or direct overseas accounts (Schwab, IBKR) must be reported separately.
Do I need to report Schwab or Interactive Brokers trades?
Yes — all foreign brokerage trades must be reported. Compile the trade history (settlement dates, quantities, prices, fees) and either enter it on Hometax directly or hire a CPA. Korean brokers don't auto-file these for you, so missing reports is a common pitfall. Separately, if your foreign account balance exceeds ₩500M at any point, you must also file a Foreign Financial Account Report.
This guide is general tax information, not personalized advice. For complex cases (derivatives, options, multiple accounts, direct overseas trading), consult a Korean licensed tax accountant or CPA.