Authored by the expert who managed and guided the team behind the South Korea Property Pack
Everything you need to know before buying real estate is included in our South Korea Property Pack
Property taxes and fees in Incheon can significantly impact your investment returns and ownership costs.
Understanding these expenses upfront is crucial for making informed decisions about buying residential or commercial real estate in South Korea's major port city. The tax structure includes basic property taxes, comprehensive real estate holding taxes, acquisition fees, and various transfer costs that can add up to substantial amounts.If you want to go deeper, you can check our pack of documents related to the real estate market in South Korea, based on reliable facts and data, not opinions or rumors.
Property owners in Incheon face annual property taxes ranging from 0.15% to 0.50% for residential properties and 0.25% to 0.50% for commercial properties, based on assessed value.
Additional costs include acquisition taxes at 2.3%, registration taxes at 3%, transfer taxes from 1% to 12%, and comprehensive real estate holding taxes up to 5% for luxury properties.
| Tax/Fee Type | Rate | When Applied |
|---|---|---|
| Property Tax (Residential) | 0.15% - 0.50% | Annual on assessed value |
| Property Tax (Commercial) | 0.25% - 0.50% | Annual on assessed value |
| Comprehensive Real Estate Holding Tax | 0.5% - 5% | High-value properties annually |
| Acquisition Tax | 2.3% | At purchase |
| Registration Tax | 3% | At registration |
| Transfer Tax | 1% - 12% | At sale (varies by ownership period) |
| Stamp Duty | 0.2% - 0.4% | On property contracts |
What is the property tax rate in Incheon?
Property tax rates in Incheon vary based on the type and value of your property.
Residential properties are taxed at rates between 0.15% and 0.50% of their assessed value annually. The exact rate depends on factors like property size, location within Incheon, and overall market value.
Commercial properties face slightly higher rates, typically ranging from 0.25% to 0.50% of assessed value. Land parcels are generally taxed at around 0.20%, making them relatively more affordable from a tax perspective.
As of September 2025, these rates remain competitive compared to other major South Korean cities, though high-value properties may face additional comprehensive real estate holding taxes that can push the effective rate much higher.
Are there any additional taxes or fees besides the basic property tax?
Yes, property owners in Incheon face several additional taxes and fees beyond the standard property tax.
The most significant additional cost is the Comprehensive Real Estate Holding Tax (CRET), which applies to high-value properties exceeding 600 million KRW for residential properties. This tax ranges from 0.5% to 2% for regular properties, but can reach up to 5% for luxury and speculative properties.
Other ongoing costs include local administrative fees, property maintenance taxes in some districts, and special levies for infrastructure development projects. These additional charges typically add 0.1% to 0.3% to your annual tax burden.
Transaction-related fees also apply when buying or selling, including acquisition taxes at 2.3%, registration taxes at 3%, and stamp duties ranging from 0.2% to 0.4% of property value.
What is the tax rate for residential properties in Incheon?
Residential property tax rates in Incheon operate on a progressive scale from 0.15% to 0.50% of assessed value.
| Property Value Range | Standard Tax Rate | Additional CRET Rate |
|---|---|---|
| Under 200 million KRW | 0.15% - 0.25% | None |
| 200-400 million KRW | 0.25% - 0.35% | None |
| 400-600 million KRW | 0.35% - 0.45% | None |
| 600 million - 1 billion KRW | 0.45% - 0.50% | 0.5% - 1% |
| Over 1 billion KRW | 0.50% | 1% - 2% |
| Luxury/Speculative Properties | 0.50% | Up to 5% |
It's something we develop in our South Korea property pack.
What is the tax rate for commercial properties in Incheon?
Commercial properties in Incheon face tax rates between 0.25% and 0.50% of assessed value, generally higher than residential rates.
Office buildings and retail spaces typically fall in the 0.30% to 0.45% range, while warehouses and industrial facilities may qualify for slightly lower rates around 0.25% to 0.35%. Premium commercial locations in Incheon's business districts face the maximum 0.50% rate.
Commercial properties also face the Comprehensive Real Estate Holding Tax if their value exceeds certain thresholds, with rates from 0.5% up to 3% for the most valuable commercial real estate. Mixed-use buildings are assessed based on their primary function and proportional usage.
Property owners can expect additional local business taxes and fees that may add another 0.2% to 0.4% to the total annual tax burden for commercial properties.
Don't lose money on your property in Incheon
100% of people who have lost money there have spent less than 1 hour researching the market. We have reviewed everything there is to know. Grab our guide now.
Is there a separate tax for property ownership versus rental income?
Yes, South Korea maintains distinct tax systems for property ownership and rental income from real estate in Incheon.
Property ownership taxes include the annual property tax (0.15% to 0.50%) and the Comprehensive Real Estate Holding Tax for high-value properties. These taxes apply regardless of whether you rent out the property or live in it yourself.
Rental income is subject to separate income tax rates that are significantly higher. Korean residents pay progressive income tax rates from 6% up to 45% on rental income, depending on their total income level. Non-resident property owners typically face a flat 22% tax rate on rental income.
You can deduct legitimate expenses like property management fees, maintenance costs, insurance, and depreciation from rental income before calculating taxes. Property taxes paid can also be deducted as business expenses when calculating rental income tax liability.
The key distinction is that ownership taxes are based on property value, while rental income taxes are based on actual income generated from the property.
How often are property taxes paid in Incheon?
Property taxes in Incheon are assessed annually and must be paid within designated periods following the assessment.
The standard property tax payment is typically due in two installments during the year - usually in July and September. Property owners receive official tax notices from the Incheon Metropolitan Government indicating the exact payment dates and amounts.
The Comprehensive Real Estate Holding Tax (CRET) for high-value properties follows a separate schedule, typically assessed in December and due for payment in the following January and February.
Late payment penalties apply at rates of 3% per month for overdue amounts, making timely payment crucial for property owners. Many owners set up automatic bank transfers to ensure payments are made on schedule.
What is the standard property tax assessment procedure in Incheon?
Property tax assessments in Incheon follow a systematic government appraisal process conducted every four years.
The Incheon Metropolitan Government uses standardized valuation methods that consider factors like location, property size, age, condition, and recent comparable sales in the area. Professional appraisers conduct physical inspections and market analysis to determine fair market values.
Property owners receive assessment notices showing the calculated value and tax amounts approximately 30 days before payment is due. You have the right to appeal assessments within 60 days if you believe the valuation is incorrect or unfair.
For property transactions, declared values from recent sales are also used for calculating transfer taxes and stamp duties. The assessment system aims to maintain property values at approximately 70% to 80% of actual market value.
Are there any exemptions or deductions available for property owners in Incheon?
Several significant exemptions and deductions are available for property owners in Incheon, particularly for primary residences and long-term holders.
The "one household, one dwelling" exemption provides substantial tax relief for homeowners living in their primary residence. Senior citizens (over 65) and long-term property holders can receive up to 80% tax credits, while properties valued below certain thresholds may qualify for complete exemptions.
As of September 2025, inheritance tax reforms offer generous deductions - spouses receive 100% deduction on inherited properties worth up to 1 billion KRW, while children can claim deductions up to 500 million KRW per child starting from 2028.
1. First-time homebuyer deductions for properties under certain value thresholds2. Rural and low-priced housing exemptions in designated areas3. Senior citizen age-based deductions (65+ years old)4. Long-term holding period deductions (10+ years ownership)5. Disabled person household exemptions with proper documentationIt's something we develop in our South Korea property pack.
How is the value of my property assessed for tax purposes in Incheon?
Property valuation for tax purposes in Incheon uses government-standardized appraisal methods updated every four years.
Professional assessors consider multiple factors including exact location within Incheon, property size and condition, building age and construction quality, recent comparable sales in the neighborhood, and local infrastructure development. The assessment aims to reflect 70% to 80% of actual market value.
For apartments and condominiums, assessors use comparative market analysis looking at similar units in the same complex and nearby buildings. Single-family homes are evaluated based on land value plus building depreciation calculated using standardized schedules.
Commercial properties undergo more complex valuations considering income potential, location premiums, and specialized features. Property owners can request reassessment if they believe the valuation is significantly incorrect, though this process requires supporting documentation and may take several months to complete.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in South Korea versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
Are there any fees for transferring property ownership in Incheon?
Property ownership transfers in Incheon involve several mandatory fees and taxes that buyers must budget for.
The primary transfer costs include acquisition tax at 2.3% of property value, registration tax at 3% of property value, and stamp duty ranging from 0.2% to 0.4% depending on the contract details. These three fees alone add approximately 5.5% to 6.7% to your purchase price.
Additional smaller fees include notary costs, legal documentation fees, and local administrative charges that typically total 0.5% to 1% of property value. Real estate agent commissions, while separate from government fees, usually add another 1% to 2% to transaction costs.
Transfer taxes for sellers range from 1% to 12% depending on property value and how long you've owned the property. Longer ownership periods generally qualify for lower transfer tax rates, encouraging property investment stability.
What are the inheritance or gift taxes related to properties in Incheon?
Inheritance and gift taxes on Incheon properties can be substantial but significant reforms in 2025 have made them more manageable.
| Relationship | Tax-Free Amount | Tax Rate on Excess |
|---|---|---|
| Spouse Inheritance | Up to 1 billion KRW (100% deduction) | 10% - 40% |
| Children Inheritance (from 2028) | 500 million KRW per child | 10% - 40% |
| Children Inheritance (current) | 200 million KRW per child | 10% - 50% |
| Other Family Members | 100-300 million KRW | 10% - 50% |
| Gift Tax (Family) | Varies by relationship | 10% - 50% |
The inheritance tax system is undergoing major reforms, with maximum rates falling from 50% to 40% and expanded deduction allowances. Proper estate planning can significantly reduce tax burdens through strategic timing and family wealth transfer structures.
Gift taxes apply when properties are transferred during the owner's lifetime, with deduction limits based on family relationships and progressive tax rates on amounts exceeding the allowances.
What is the stamp duty for property transactions in Incheon?
Stamp duty on property transactions in Incheon ranges from 0.2% to 0.4% of the contract value.
The exact stamp duty rate depends on the property value and transaction type. Lower-value properties (under 500 million KRW) typically face 0.2% stamp duty, while higher-value properties and commercial transactions often pay the full 0.4% rate.
Stamp duty is paid when registering the purchase contract and must be submitted with official documentation to the local registry office. This cost is separate from other transaction fees and cannot be avoided or deferred.
For property sales, stamp duty applies to both the purchase contract and any supplementary agreements or modifications. The duty is calculated on the declared transaction value, making accurate property valuation important for determining the exact cost.
It's something we develop in our South Korea property pack.
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 all taxes and fees is crucial for accurate investment planning in Incheon's property market.
Recent tax reforms in 2025 have made property ownership more affordable, particularly for inheritance situations, though high-value properties still face substantial tax burdens that require careful financial planning.
Sources
- Global Property Guide - South Korea Taxes and Costs
- Buch Dein Visum - Buying Real Estate in South Korea
- Chosun Business - Property Tax Policy 2025
- Korea Times - Inheritance Tax Reform
- Chosun English - Tax Policy Updates
- Invest Korea - Taxation Guide 2025
- Deloitte - Korea Tax Highlights 2025
- National Tax Service Korea - Official Tax Information