Korea Card Deduction: Credit vs Debit for the Last Quarter (Oct–Dec) and the 25% Threshold

The rule

Only card and cash-receipt spending above 25% of gross salary is deductible.
Rates: credit card 15%, debit card and cash receipts 30% (traditional markets and public transport have their own rates).
The 25% threshold is filled by credit-card spending first, which is why people say “credit card up to the threshold, debit after”.
Basic cap: 3 million KRW for gross salary up to 70 million, 2.5 million above (2025 tax year).
Car purchases, insurance premiums, utility bills, university tuition and gift certificates do not count.
Foreign employees who are tax residents can claim this deduction like Korean nationals.

Cash receipts (hyeongeum yeongsujeung) can be issued against your phone number when you pay in cash; ask for one at the counter so the spending is reported to the NTS.

Same 16 million KRW, different cards

Gross salary 40 million KRW (25% = 10 million), annual spending 16 million KRW, entered in the app.

Mix	Card deduction	Estimated refund (incl. local tax)
Credit 16M	900,000 KRW	about 149,000 KRW
Credit 10M + debit 6M	1,800,000 KRW	about 297,000 KRW
Debit 16M	1,800,000 KRW	about 297,000 KRW
Credit 8M (below 25%)	0	0

Filling the threshold with credit or debit gives the same result. Use the card with the best perks up to the threshold, then move spending above it to debit or cash receipts.

This guide is general tax information and a walk-through of how the numbers work, not tax advice. Deduction rules change every year and depend on your residency status and situation. Confirm what applies to you with the National Tax Service (Hometax year-end settlement preview and simplified service, NTS helpline 126) and your employer’s payroll or HR team. The app’s result is an estimate covering major items only and has no legal effect.

What to do in October

Check January–September spending in your card apps or on Hometax (the preview shows it automatically once open).
Annual estimate = Jan–Sep spending + expected Oct–Dec spending. Compare it with 25% of gross salary.
Already over? Shift the rest of the year to debit card and cash receipts.
Not going to reach 25%? Forget the deduction and keep the card with the best rewards. Spending more to chase a deduction always costs more than it returns.

Planning with the app

Card / cash spending section with Credit card and Debit / cash receipt fields — Card fields

Enter annual estimates by card type

Under “Card / cash spending”, enter expected annual totals for “Credit card” and “Debit / cash receipt” in units of 10,000 KRW. The app has no fields for traditional-market or transport rates, so treat its figure as conservative.

Saved tab scenario card — Compare scenarios

Save mixes and compare

Save “mostly credit” and “switch to debit” scenarios and compare the refund on the Saved tab. If the difference is a few tens of thousands of won, card rewards may be worth more.

The app’s English screens show amounts with the Korean won sign, and the saved-scenario card keeps a few Korean labels in the current version.

FAQ

Do cards issued abroad count?

The deduction is built on spending data reported in Korea. Check with HR or the NTS before counting foreign-issued cards.

Is there anything beyond the 3M KRW cap?

Some categories (traditional markets, public transport and others) have extra limits. The app only models the basic cap.

Sources: Korea.kr, 2025 year-end settlement preview opens (Korean) · Korea Tax Times, year-end settlement for foreign workers (Korean)

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