| (1) | "The account specified by Presidential Decree as an account opened under the title of "pension savings"" in the provisions, with the exception of the items, of Article 20-3(1)2 of the Act, means the account specified in subparagraph 1, while "the account specified by Presidential Decree as an account opened in order to receive retirement pensions" means the account specified in subparagraph 2: <Amended on Feb. 3, 2015; Feb. 15, 2022> |
| 1. | An account opened under the title of "pension savings" pursuant to an agreement concluded with any of the following financial companies, etc. (hereinafter referred to as "pension savings account"): |
| a. | A trust agreement to be concluded with a trust business entity authorized pursuant to Article 12 of the Financial Investment Services and Capital Markets Act; |
| b. | An agreement for intermediating collective investment securities to be concluded with an investment broker authorized pursuant to Article 12 of the Financial Investment Services and Capital Markets Act; |
| c. | An insurance agreement to be concluded with an institution which handles insurance agreements pursuant to Article 25(2); |
| 2. | Any of the following accounts to be subscribed to and established in order to receive retirement pension (hereinafter referred to as "retirement pension account"): |
| a. | An account to be established in accordance with a defined contribution retirement pension defined in subparagraph 9 of Article 2 of the Act on the Guarantee of Workers' Retirement Benefits; |
| b. | An account to be established in accordance with an individual retirement pension defined in subparagraph 10 of Article 2 of the Act on the Guarantee of Workers' Retirement Benefits; |
| c. | An account to be established in accordance with a SME retirement pension fund plan defined in the Act on the Guarantee of Employees’ Retirement Benefits; |
| d. | An account to be established in order to receive the retirement pension payment pursuant to Article 16(1) of the Korea Scientists and Engineers Mutual Aid Association Act. |
| (2) | Where a holder of a pension account fulfills the following requirements, pension insurance premiums under Article 59-3(1) of the Act (including amounts deemed paid into the pension account under Article 118-3; hereinafter referred to as "pension insurance premiums") shall be deemed pension insurance premiums: <Amended on Feb. 21, 2014; Feb. 3, 2015; Feb. 12, 2019; Feb. 11, 2020; Feb. 28, 2023> |
| 1. | The holder must pay the amount not exceeding the sum of the following amounts (where the holder has at least two pension accounts, referring to the aggregate amount of such accounts); in such cases, although he or she may not pay the pension insurance premium for any taxable period prior to the taxable period concerned, he or she may, in cases of an insurance agreement, pay the previous pension insurance premium before three years lapse from the last day of the month to which the final payment date belongs; |
| a. | 18 million won each year; |
| b. | Transferred amount under Article 59-3(3) of the Act [referring to the amount paid into a pension account from an individual savings account up to the balance as of the expiration date of the contract of an individual savings account under Article 91-18 of the Act on Restriction on Special Cases concerning Taxation (hereinafter referred to as an "individual savings account"); provided, where the payment has been made between the immediately preceding taxable period and the relevant taxable period, referring to the amount paid into a pension account from an individual savings account up to the amount calculated by subtracting the amount paid in the immediately preceding taxable period from the balance as of the expiration date of the contract of an individual savings account]; |
| c. | Where a resident who transfers housing owned in the Republic of Korea (hereafter in this Article referred to as "pension housing") and acquires or does not acquire another housing as a substitute (hereafter in this Article, referred to as "reduced housing") fulfills all the following requirements, the amount paid into a pension account out of the amount calculated by subtracting the acquisition value of the reduced housing (if not acquired, referring to zero) from the transferred value of the pension housing; in such cases, the total accumulated value of the housing differences paid by the resident to the pension account shall be limited to 100 million won: |
1) The resident or his or her spouse shall be at least 60 years old as of the transfer date of pension housing;
2) When combining houses that the resident and his or her spouse own in the Republic of Korea as of the transfer date of pension housing, they shall own one pension housing only; provided, where they acquire the reduced housing before transferring the pension housing and transfer the pension housing within six months from the date the reduced housing was acquired, they shall be deemed to own one pension housing only as of the transfer date of the pension housing;
3) The assessed value of the pension housing under Article 99 of the Act shall not exceed 1.2 billion won as of the transfer date of the pension housing;
4) The acquisition value of the reduced housing shall not exceed the transferred value of the pension housing (limited to cases where the reduced housing is acquired)
5) The resident shall pay the housing difference into the pension account of the owner of the pension housing within six months from the transfer date of the pension housing;
| 2. | The holder shall not pay the pension insurance premium after the date he or she applies for the initiation of pension payment (referring to the agreed date of initiation, if there is the agreed date of initiation of pension payment). |
| (3) | "Withdrawn in the form of the pension, etc. prescribed by Presidential Decree" in the main sentence of Article 20-3(1)2 of the Act, means where a withdrawal from a pension account meets all the following requirements or is made in accordance with Article 20-2(1) (hereinafter referred to as "receipt of pension"; any withdrawal other than the receipt of pension shall be referred to as "receipt other than pension"); provided, where retirement income under Article 20-3(1)2a of the Act is withdrawn by reason of emigration under Article 20-2(1)1b, the relevant retirement income shall be deemed the receipt of pension only where the withdrawer emigrates not earlier than three years after the date the retirement income is deposited in the pension account: <Amended on Feb. 21, 2014; Feb. 3, 2015; Feb. 3, 2017> |
| 1. | A holder must, after he or she reaches 55 years of age, file his or her application with the person in charge of the pension account for initiation of pension payment and then withdraw the pension money; |
| 2. | A holder must withdraw pension money after five years from the date of his or her subscription to the pension account; provided, this shall not apply where the amount of money pursuant to Article 20-3(1)2a of the Act (including where a retirement income is withdrawn directly from the pension account; hereinafter referred to as "deferred retirement income") is in the pension account; |
| 3. | A holder shall withdraw pension money within the limit of the amount computed by the following formula (hereinafter referred to as "limit of pension payment") as at the date of initiation of the taxable period (or the filing date of the application for the initiation of pension payment in the case of the taxable period in which the application for the initiation of pension payment is filed). In such cases, an amount withdrawn in accordance with Article 20-2(1) shall not be included in the withdrawn amount: |
Appraised value of pension account / (11 - Number of years of pension payment) × 120 / 100
| (4) | "Number of years of receiving pension" in the calculation formula under paragraph (3)3 means the number of years aggregated from the taxable period to which the date of first pension payment belongs, and the calculation formula shall not apply where the number of years of receiving pension is at least 11 years; provided, in any of the following cases, the year of initial pension payment shall be as follows: |
| 1. | In cases of a pension account to which a person subscribed before March 1, 2013 (including where a person who has subscribed to the defined payment retirement pension (hereinafter referred to as "defined payment retirement pension") before March 1, 2013, in accordance with subparagraph 8 of Article 2 of the Act on the Guarantee of Workers' Retirement Benefits, retires and the entire amount of the retirement income is transferred to the newly established pension account): Sixth year; |
| 2. | In cases of succeeding to a pension account pursuant to Article 44(2) of the Act: The number of years of receiving pension by an inheritee as at the date of his or her death. |
| (5) | The amount withdrawn from a pension account which exceeds the limit of pension payment shall be deemed receipt other than pension. |
| (6) | Upon receipt of an application for initiating pension payment or for terminating a pension account from the holder of the pension account, the administrator of the pension account shall submit a statement of the initiation of pension payment or of the termination of the pension account in the form prescribed by Decree of the Ministry of Economy and Finance to the head of the relevant tax office by the tenth day of the following month. <Amended on Feb. 3, 2015> |
| (7) | Where a resident intends to pay housing differences into a pension account, he or she shall submit an application form prescribed by Decree of the Ministry of Economy and Finance, accompanying the following documents, to the person in charge of the pension account: <Added on Feb. 28, 2023> |
| 1. | A contract of sale for the pension housing; |
| 2. | A contract of sale for the reduced housing (limited to cases where the reduced housing is purchased); |
| 3. | Other documents prescribed by Decree of the Ministry of Economy and Finance. |
| (8) | Where a resident falls under any of the following cases after paying the housing differences into a pension account, the total amount paid into the pension account from the payment date shall not be deemed pension insurance premiums: <Added on Feb. 28, 2023> |
| 1. | Where it is confirmed that the resident fails to fulfill the requirement under paragraph (2)1c as of the date on which the housing differences are paid to the pension account; |
| 2. | Where a new house is acquired within five years from the date on which the housing differences are paid and the amount calculated by subtracting the acquisition value of the newly acquired housing from the transferred value of the pension housing is less than the amount paid into the pension account. |
| (9) | The Commissioner of the National Tax Service shall confirm whether a resident who has paid the housing differences into a pension account falls under the subparagraphs of paragraph (8), and, if any, notify the fact to the person in charge of the relevant pension account by the end of February every year, and then the person in charge of the pension account shall notify such fact to the relevant resident. <Added on Feb. 28, 2023> |
| (10) | A pension account manager shall, upon receipt of a notice under paragraph (9), return to a resident the contributions to the housing difference pension account, which are not considered as the pension premiums under paragraph (8), and the amount increased according to the performance of its management. In such cases, the resident shall be deemed to have received the returned amount as a non-pension withdrawal. <Amended on Feb. 29, 2024> |
| (11) | Where not less than two residents jointly own one housing, paragraph (2)1c and paragraphs (7) through (10) shall apply as if they respectively owned one housing in proportion to their equity ratio: Provide, That where a resident and his or her spouse jointly own one housing, paragraph (2)1c2) shall apply as if they jointly owned one housing. <Added on Feb. 28, 2023> |
| (12) | For the purpose of paragraph (11), the assessed value under paragraph (2)1c3) refers to the assessed value on the entire housing despite the ownership share of housing; and when transferring or acquiring the ownership share of housing, the transferred value and acquisition value under subitem 4) of that item shall be the value based on the entire housing, which is calculated as prescribed by Decree of the Ministry of Economy and Finance. <Added on Feb. 28, 2023> |
[This Article Added Feb. 15, 2013]