Maybe you just received your severance pay (toejikgeum, 퇴직금), got your jeonse deposit back, or sold something in your home country and moved the money to Korea. Either way, you are now holding around 100 million won (1억 원) and wondering two things: if you park it in a Korean term deposit (jeonggi yegeum, 정기예금), how much will actually land in your account after tax, and is it safe to keep the whole amount at a single bank?
The rate a Korean bank advertises, say 3% a year, is a pre-tax number. This guide starts with the figures you came for: a table of yearly and monthly interest on 100 million won at rates from 2.5% to 3.5%, before and after tax. After that we cover payout options, the deposit protection limit, the point where tax rules change, and what is different if you are a foreign resident.
1. Yearly Interest on 100 Million Won — Before and After Tax by Rate
The table assumes a one-year term deposit with simple interest, paid at maturity. After-tax figures subtract Korea's standard 15.4% withholding on interest (14% income tax plus 1.4% local income tax).
| Annual rate | Pre-tax yearly interest | Tax (15.4%) | After-tax yearly interest | After-tax per month |
|---|---|---|---|---|
| 2.5% | 2,500,000 won | 385,000 won | 2,115,000 won | 176,250 won |
| 2.8% | 2,800,000 won | 431,200 won | 2,368,800 won | 197,400 won |
| 3.0% | 3,000,000 won | 462,000 won | 2,538,000 won | 211,500 won |
| 3.2% | 3,200,000 won | 492,800 won | 2,707,200 won | 225,600 won |
| 3.5% | 3,500,000 won | 539,000 won | 2,961,000 won | 246,750 won |
Every 0.1 percentage point is worth 100,000 won before tax, or 84,600 won after tax, on 100 million won. The gap between 3.0% and 3.5% is roughly 420,000 won a year after tax, which is why it pays to compare banks rather than accepting the first offer.
For a shorter term, scale by time. A six-month deposit at 3% earns 1.5 million won before tax and 1,269,000 won after tax. Keep in mind that six-month and one-year products usually carry different rates, so do not assume the same rate applies to both.
2. Monthly Interest — The Converted Figure vs. Money Actually Paid
Divide the yearly figure by 12 and you get the monthly equivalent:
- 2.5%: about 208,333 won before tax, about 176,250 won after tax
- 3.0%: 250,000 won before tax, 211,500 won after tax
- 3.5%: about 291,667 won before tax, about 246,750 won after tax
The catch is that a standard deposit does not pay you this amount every month. With a maturity-payout product (mangi ilsi jigeupsik, 만기일시지급식), the whole year's interest arrives on the maturity date. If you want cash every month, you must choose a monthly-interest product (wol ija jigeupsik, 월이자지급식) when you open the account. The bank then withholds 15.4% from each month's interest, so a 3% deposit pays about 211,500 won each month.
Banks calculate interest by the day and truncate tax to the won, so monthly deposits can vary by a few hundred to a few thousand won. February pays a little less; 31-day months pay a little more.
3. Why the Numbers Come Out This Way — Withholding and Compounding
The 15.4% is taken before you see it
Korean banks withhold 14% income tax plus a 1.4% local income tax at the moment interest is paid. Multiply pre-tax interest by 0.846 and you have a very close estimate of what you will receive. Certain tax-free products have a 0% rate, but they come with eligibility rules.
Simple vs. monthly compounding on 100 million won
Most one-year deposits use simple interest. Some products compound monthly, so each month's interest earns interest the following month. At 3%:
- Simple interest: 3,000,000 won before tax, 2,538,000 won after tax
- Monthly compounding: about 3,041,596 won before tax, about 2,573,190 won after tax
Over one year the compounding bonus is only about 35,000 won after tax, but it widens as the term gets longer. For the math behind that, see our compound interest and savings planning guide.
4. Pay at Maturity or Pay Monthly — Which Suits You?
| Maturity payout | Monthly payout | |
|---|---|---|
| When interest arrives | Once, on the maturity date | Every month on a set date |
| 100M won at 3%, after tax | 2,538,000 won at maturity | About 211,500 won per month |
| Typical rate | Usually the higher of the two | Often set slightly lower for the same product |
| Compounding | Possible with monthly-compound products | None, since interest is withdrawn |
| Best for | Growing a lump sum | Covering regular living costs |
If you do not need the money for living expenses, the maturity payout usually wins: banks often price the monthly version a little lower, and withdrawn interest stops earning anything. If you need steady cash flow, for example to cover rent while between jobs, the monthly option is easier to manage even at a slightly lower rate. Ask the bank for both rates and compare them side by side.
5. Deposit Protection of 100 Million Won — Is One Bank Enough?
The limit rose to 100 million won in September 2025
Korea's deposit protection limit went up from 50 million won to 100 million won on September 1, 2025. The new limit covers commercial banks, savings banks (jeochuk eunhaeng, 저축은행), and mutual credit institutions such as Nonghyup, Suhyup, Shinhyup and Saemaeul Geumgo. It applies per person, per financial institution.
Principal and interest count together
This is the part people miss. The 100 million won limit covers principal plus a set amount of interest combined, and all your deposits at the same institution are added up, even if they sit at different branches.
| Principal | Rate | Balance at maturity (pre-tax) | vs. 100M won limit |
|---|---|---|---|
| 100,000,000 won | 3.0% | 103,000,000 won | 3M won over |
| 100,000,000 won | 3.5% | 103,500,000 won | 3.5M won over |
| 97,000,000 won | 3.0% | 99,910,000 won | Within limit |
| 96,500,000 won | 3.5% | about 99,880,000 won | Within limit |
If you put the full 100 million won in one place, your maturity balance exceeds the limit, and the excess may not be covered if that institution fails. To keep everything protected, deposit roughly 96 to 97 million won in one institution and put the rest elsewhere.
When splitting matters most
Large commercial banks carry very little failure risk in practice. But if you are chasing a higher rate at a savings bank or an individual credit cooperative, keep the maturity balance at each one under 100 million won. Separate institutions are protected separately, so 200 million won split across two of them is fully covered.
6. When a Bigger Balance Changes the Tax
For a single 100 million won deposit, the 15.4% withholding is the end of the story. Once your combined interest and dividends exceed 20 million won in a year, however, the excess is taxed together with your other income at progressive rates (comprehensive financial income taxation, 금융소득종합과세). The principal needed to reach 20 million won of interest:
- At 2.5%: about 800 million won
- At 3.0%: about 667 million won
- At 3.5%: about 571 million won
A 100 million won deposit earns at most around 3.5 million won a year, so it is far from that line. If you hold deposits at several banks plus dividend income, everything is added together, and staggering maturity dates across calendar years can help.
7. What Changes If You Are a Foreign Resident in Korea
The core numbers in this guide apply to you too, but a few points deserve attention:
- Tax residency decides how you are treated. Under Korean tax law, a person who has an address in Korea or has stayed in the country for 183 days or more is a resident. Residents have the standard 15.4% withheld on deposit interest, the same as Korean nationals.
- If you have only just arrived, or you are about to leave, your residency status may be unclear. Tell the bank your status when you open the account and ask how interest will be withheld for you; if you are treated as a non-resident, the treatment can differ, so confirm it with the bank or the National Tax Service rather than assuming 15.4%.
- Match the deposit term to your visa and contract. Breaking a term deposit early triggers a much lower early-termination rate. If your contract or visa ends in eight months, a six-month deposit is usually smarter than a one-year one.
- Watch the currency side. If the money came from abroad, your real return in your home currency also depends on the exchange rate when you convert back. A 3% deposit can be wiped out by a weaker won, or boosted by a stronger one.
- Plan the exit. Before leaving Korea, line up the maturity date with your departure and make sure you know how to close the account and send the funds home.
8. Frequently Asked Questions (FAQ)
Q1. Exactly how much does 100 million won earn in a year after tax?
Multiply 100 million won by the annual rate, then by 0.846. At 3%, that is 3 million won before tax and 2,538,000 won after tax. Daily calculation and rounding can shift the real figure by a few hundred won.
Q2. Will I receive interest every month?
Only if you choose the monthly-interest option when you open the deposit. Standard deposits pay everything at maturity. A 3% monthly-payout deposit on 100 million won pays about 211,500 won a month after tax.
Q3. Does the 100 million won protection include interest?
Yes. Principal and a set amount of interest are combined, up to 100 million won per person per institution. A full 100 million won at 3% grows to 103 million won at maturity, so to stay fully protected, deposit around 97 million won and place the rest at another institution.
Q4. Does the 15.4% rate apply to foreigners?
If you are a tax resident in Korea (an address in Korea or 183 or more days of stay), the standard 15.4% withholding applies just as it does for Korean nationals. If you may be a non-resident, ask your bank how your interest will be taxed before opening the account.
9. Recalculate With Your Own Rate in the Savings Interest Calculator
The table above uses representative rates, and the deposit you are actually considering will have its own rate and term. Enter 100 million won, the bank's quoted rate and the number of months into the Savings & Deposit Interest Calculator, and it shows simple and monthly-compound interest before tax, the after-tax amount with 15.4% withheld, and your total payout at maturity. Switch the tax setting to tax-free to see how much a tax-advantaged product would add. It turns "how much will I get from this bank in a year?" into a single, exact number.
To see how a deposit grows over two, three or more years with compounding, try the savings simulation in the Loan & Interest Calculator, and read our compound interest and savings planning guide for the principles behind it.
