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Understanding property taxes and fees in Daegu is crucial for making informed real estate investment decisions.
Property buyers in Daegu face multiple tax layers including acquisition tax at 4.6%, registration tax at 3%, plus various local fees and annual holding taxes. For a typical ₩300 million apartment, upfront costs range from ₩32-35 million, while annual taxes average ₩460,000-₩1,650,000 depending on the property's assessed value.
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Property taxes and fees in Daegu include acquisition tax (4.6%), registration tax (3%), realtor commissions (0.4% capped), and annual holding taxes (0.15-0.5% of assessed value).
Total upfront costs for a ₩300 million apartment typically range from ₩32-35 million, with annual taxes of ₩460,000-₩1,650,000 depending on the property type and assessment.
| Fee/Tax Type | Rate/Percentage | Amount (₩300M Property) |
|---|---|---|
| Acquisition Tax | 4.6% | ₩13,800,000 |
| Registration Tax | 3% | ₩9,000,000 |
| Local Education/Special Taxes | 1.2-1.4% | ₩3,600,000-₩4,200,000 |
| Realtor Commission | 0.4% | ₩1,200,000 |
| Stamp Duty & Notary | 0.2-1.4% | ₩3,600,000-₩4,200,000 |
| Annual Holding Tax | 0.15-0.5% | ₩360,000-₩1,350,000 |
| Total Upfront Costs | 10.7-11.7% | ₩32,000,000-₩35,000,000 |
What property type determines your tax burden in Daegu?
Property type significantly impacts your total tax burden in Daegu, with residential apartments facing the most favorable rates compared to commercial properties or land.
Apartments and officetels are subject to the standard 4.6% acquisition tax rate, while commercial properties face higher rates up to 8%. Land purchases typically incur additional development taxes that can add 1-2% to your total cost.
Villas (detached houses) follow residential tax brackets but may face higher property holding taxes due to larger assessed values. As of September 2025, apartments remain the most tax-efficient option for foreign investors in Daegu.
The property registration process also varies by type, with apartments requiring standard documentation while land purchases need additional zoning and development permits that increase administrative costs.
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How does your purchase price affect tax brackets in Daegu?
Purchase price directly determines which tax brackets apply, with significant cost increases at key thresholds of ₩600 million and ₩900 million.
Properties under ₩600 million benefit from standard acquisition tax rates of 4.6%, while purchases exceeding this threshold face progressive increases. The ₩600-900 million bracket sees rates climb to 5.2%, and properties over ₩900 million face 5.8% acquisition tax.
Realtor commission caps also change with price brackets - properties between ₩200-600 million are capped at 0.4%, while higher-value properties can command up to 0.6% in commissions. Registration fees remain consistent at 3% regardless of purchase price.
Most Daegu apartments fall within the favorable under-₩600 million bracket, with average prices ranging from ₩6.7-9.9 million per square meter as of September 2025.
What is the exact acquisition tax rate and calculation for Daegu properties?
The acquisition tax rate in Daegu is 4.6% for most residential properties, calculated on the full purchase price including any premiums or additional payments.
| Property Value (KRW) | Acquisition Tax Rate | Tax Amount Example |
|---|---|---|
| Under ₩200 million | 4.6% | ₩9.2 million (₩200M property) |
| ₩200-600 million | 4.6% | ₩13.8 million (₩300M property) |
| ₩600-900 million | 5.2% | ₩36.4 million (₩700M property) |
| Over ₩900 million | 5.8% | ₩58 million (₩1B property) |
| Second homes | 6.0% | ₩18 million (₩300M property) |
| Commercial properties | 7.0-8.0% | ₩21-24 million (₩300M property) |
Are there additional local taxes on top of acquisition tax?
Yes, local education tax and special purpose taxes add 1.2-1.4% to your total acquisition costs in Daegu.
Local education tax adds 0.4% to all property purchases, while special purpose taxes vary by district but typically range from 0.8-1.0% of the purchase price. These taxes are collected simultaneously with acquisition tax and cannot be avoided.
Stamp duty adds another 0.2-0.4% depending on the property value and documentation requirements. Agricultural development tax may apply to certain land conversions, adding up to 0.3% for specific property types.
For a ₩300 million apartment, these combined local taxes total approximately ₩3.6-4.2 million, paid upfront at the time of purchase registration.
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What are the registration and transfer fees including notary costs?
Registration tax stands at 3% of the property value, while transfer fees and notary costs add approximately 1% to your total purchase expenses.
Registration tax of 3% is mandatory for all property transfers and covers the cost of updating ownership records with the government. Stamp duty ranges from 0.2-0.4% depending on the property value and transaction complexity.
Notary fees typically cost ₩200,000-500,000 for standard residential transactions, while legal documentation and translation services can add another ₩500,000-1 million for foreign buyers requiring additional paperwork.
Title insurance and property verification services, while optional, cost approximately ₩300,000-800,000 but provide important protection for international investors unfamiliar with Korean property law.
How much do realtor commissions cost in Daegu?
Realtor commissions in Daegu are capped by law at 0.4% for properties between ₩200-600 million, with higher rates for premium properties.
The commission structure is strictly regulated, with properties under ₩200 million capped at 0.6%, ₩200-600 million at 0.4%, and properties over ₩600 million at 0.5%. These rates represent the maximum legal charges, and negotiation is possible.
Most transactions involve both buyer and seller agents, but the commission is typically split between parties or paid entirely by the seller depending on market conditions and negotiation.
For a typical ₩300 million apartment purchase, realtor commission costs ₩1.2 million, making it one of the smaller components of your total transaction costs.
Additional services like property management setup or rental assistance may incur separate fees of ₩200,000-500,000 depending on the scope of service required.
What mortgage-related costs should you expect?
Mortgage registration tax costs 0.2-0.3% of your loan amount, while bank processing fees range from ₩300,000-500,000 per loan application.
Banks charge mortgage registration tax based on the loan value, not the property value, which can significantly reduce this cost if you're financing only a portion of the purchase. Documentation and processing fees vary by lender but typically fall within the ₩300,000-800,000 range.
Property appraisal costs ₩400,000-600,000 and is required by most lenders before loan approval. Insurance requirements may add ₩200,000-400,000 annually depending on the property value and loan terms.
Foreign buyers often face additional documentation requirements that can increase processing fees by ₩200,000-500,000, including income verification and currency exchange documentation.
Early repayment penalties typically range from 1-3% of the outstanding loan balance if you pay off the mortgage within the first 2-3 years.
How is annual property holding tax calculated in Daegu?
Annual property holding tax ranges from 0.15-0.5% of the officially assessed property value, with rates varying based on property type and ownership status.
The assessed value is typically 60-80% of the market purchase price, meaning a ₩300 million apartment has an assessed value of approximately ₩240 million. Single-family residents pay 0.15-0.25%, while multiple property owners face rates up to 0.5%.
Tax calculation occurs annually in May based on the previous year's assessed value, with payments due by July 31st. Properties under ₩60 million assessed value are exempt from holding tax entirely.
For a typical ₩300 million apartment with ₩240 million assessed value, annual holding tax ranges from ₩360,000 for single-property owners to ₩1.2 million for multiple property investors.
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What city planning and community charges apply in Daegu?
City planning contributions and community development fees in Daegu typically cost ₩100,000-300,000 annually, depending on the property's location and development status.
- Infrastructure development tax: ₩50,000-150,000 annually for properties in developing districts
- Community facility maintenance: ₩30,000-100,000 annually for apartment complexes
- Local utility connection fees: ₩20,000-50,000 annually for water and sewage systems
- District beautification charges: ₩10,000-30,000 annually in commercial areas
- Environmental protection fees: ₩15,000-40,000 annually for properties near protected zones
These fees are collected quarterly through local district offices and vary significantly based on the specific neighborhood and development phase. New construction areas may face higher charges during the first 5-10 years of development.
What exemptions and reductions are available for property buyers?
First-time Korean resident buyers can reduce acquisition and registration taxes to a combined 2.8%, but foreign investors have limited exemption opportunities.
Korean citizens purchasing their first home receive acquisition tax reduction from 4.6% to 1.0% and registration tax reduction from 3% to 0.8%, saving approximately ₩8-10 million on a ₩300 million purchase.
Foreign buyers with F-5 (permanent resident) visas may qualify for partial reductions, typically saving 10-20% on acquisition taxes. Investment visa holders (D-8) face standard rates with no exemptions.
Long-term rental properties held for more than 8 years may qualify for holding tax reductions of up to 20%, but this requires maintaining rental status throughout the holding period.
Senior citizens over 65 purchasing properties under ₩200 million may receive holding tax exemptions, but this benefit doesn't apply to foreign investors.
What penalties apply for late tax payments?
Late payment penalties include 1% monthly surcharge on unpaid property taxes plus administrative fees ranging from ₩20,000-100,000.
Property holding tax late payments incur 1% monthly interest on the unpaid balance, compounded monthly until full payment. Administrative penalties start at ₩20,000 for the first month and increase to ₩100,000 for payments more than 6 months overdue.
Transfer tax delays for property registration can result in 0.5-2% additional charges plus daily administrative fees of ₩5,000-10,000. Properties cannot be legally occupied or sold until all transfer taxes are current.
Acquisition tax payment must be completed within 30 days of the property purchase agreement, with late penalties starting immediately after this deadline.
Repeated late payments can result in property liens and forced sale proceedings, particularly problematic for foreign investors who may not receive timely notifications.
What are the total estimated costs for a typical Daegu property?
For a ₩300 million apartment in Daegu, total upfront costs range from ₩32-35 million (10.7-11.7% of purchase price), with annual taxes averaging ₩460,000-1,650,000.
| Cost Category | Upfront Amount (KRW) | Annual Amount (KRW) |
|---|---|---|
| Acquisition Tax (4.6%) | 13,800,000 | - |
| Registration Tax (3%) | 9,000,000 | - |
| Local/Education Taxes | 3,600,000-4,200,000 | - |
| Stamp Duty & Notary | 3,600,000-4,200,000 | - |
| Realtor Commission | 1,200,000 | - |
| Property Holding Tax | - | 360,000-1,350,000 |
| Community Charges | - | 100,000-300,000 |
| Total Estimated Costs | 32,000,000-35,000,000 | 460,000-1,650,000 |
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Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Understanding the complete tax structure in Daegu is essential for calculating your true investment returns and avoiding unexpected costs.
As of September 2025, foreign investors should budget approximately 11% of the purchase price for upfront taxes and fees, plus annual holding costs of 0.15-0.55% of the property's assessed value.
Sources
- Daegu Property Market Overview
- Daegu Price Forecasts and Analysis
- Korea JoongAng Daily - Real Estate Commission Rates
- Property Purchase Guide South Korea
- Deloitte Korea Tax Highlights 2025
- Legal 500 - Korea Tax Amendments 2025
- Daegu Metropolitan City Official Website
- Global Property Guide - South Korea Price History