How to Get a Tax Refund in Korea
Updated in 2022! The updated methods for receiving a tax refund in Korea! How to get a tax refund from the airport and in the city
If you are planning to shop in Korea (as you should!) you will want be able to shop at a lower price, because it will be tax free. However, if it is your first time shopping in Korea, you may be confused about what duty free and tax free shopping is, and how you should file a tax return. Do not worry, we have come prepared for you with a in depth guide on how to shop tax-free and the best way that you can get a tax refund in Korea!
Korea's Tax Free System
The tax refund system in Korea is divided into "Duty Free" and "Tax Refund". There are two methods for a tax refund. You can either receive a refund when leaving the country after a purchase or you can receive a refund at the store immediately after purchase (or pay at a price exempt from VAT).
Duty Free (advance duty-free system)
VAT, individual consumption tax, tobacco consumption tax and liquor tax are all exempted. The advance duty free shop is characterized by being able to purchase goods coming abroad at low prices. These stores are usually large department stores such as Shinsegae, Shilla, Lotte and are located in the airports and downtown areas. Tourists can purchase goods at a low price when they are leaving the country.
The limit purchase on duty free items upon departure: You can purchase up to 600 USD for foreign tourists. (alcoholic beverages and perfumes purchased at duty-free shops are subject to tax exemption separately from the basic duty-free shop.)
Tax Refund (after-tax exemption system)
Only VAT and individual consumption tax are exempted. (This does not include customs duties, tobacco consumption tax, and liquor tax.) Tax refund is a system in which shoppers purchase products at the full price including tax and receive a refund of the tax paid before departure. In other words, it is a system that refunds VAT if you purchase in excess of a certain amount. In general, you can receive a tax refund by showing the receipt (refund slip) at the tax refund booth upon departure.
Immediate Tax Refund
Tourists can easily and immediately get a tax-free refund within a certain limit when they shop at a certified tax free store.
Duty Free
The tax imposed by the duty free shop is a duty on imports and does not apply to travelers. Therefore, you do not have to worry about products soled at major duty-free downtown department stores or airport duty free shops as the price does not include tax.
Duty Free Purchase Limit
Foreign travelers can purchase up to 600 USD at the duty free shop.
In addition to the applicable duty-free limit, alcohol and perfume can be purchased within a separate duty-free range.
Alcoholic beverages are not included in the 600 USD duty free limit for one alcoholic beverage of 1L or less, 60ml of perfume, 200 cigarettes. This means that if you have already met the 600 USD duty-free limit, you can still buy alcoholic beverages, cigarettes and perfumes that meet this threshold.
If the total of goods purchased overseas or at duty free shops (departure, arrival, duty free shops) exceeds 600 USD, the amount in excess of the duty-free limit of 600 USD will be taxed.
Declaration of products exceeding the duty-free limit
If you bring in items that exceed the duty-free limit, 30% of the standard duty will be reduced if you voluntarily declare it.
However, if you are caught not declaring it, you will be penalized according to the 'Customs Act; (ex. 50% more than general tax, additional 60% penalty if caught twice or more within 2 years)
Immediate Tax Refund
Immediate Tax Refund Rules:
Consumption Amount: 30,000 - 500,000 KRW including tax for one-time payment (2020/04/01~)
If the purchase amount is less than 2,500,000 KRW during the entire trip to Korea
Immediate Tax Refund Method:
Before shopping, check whether the store is a VAT refund merchant! (some marts, shopping malls, department stores, etc.) After purchasing items with a consumption amount of 30,000 - 500,000 KRW you can pay the duty-free price by presenting your passport to the cashier. Alternatively, after paying the price inclusive of tax, you can receive a tax refund at the information desk.
Notes on immediate tax refund:
If you have paid more than 500,000 or purchased more than 2,500,000 KRW after entering Korea, you have no choice but to go to the airport to get your tax refund.
Immediate Tax Refund Eligible Individuals:
Foreigners (less than 6 months in Korea)
Overseas Koreans (living abroad for more than 2 years or living in Korea for less than three months)
Those who do not pay Korean taxes
Process of receiving tax refund at the airport (city)
1) Preparations for tax refund
If you want to receive a tax refund before departure, you must purchase items at the Tax Free Store, present your passport to the store staff and request a tax refund form or tax refund slip.
Please keep the tax refund form, receipt, purchased items, (unopened or unused), and passport issued by the store until departure.
Travelers who want to apply for a VAT refund at the departure airport are advised to arrive well in time in case the airport is crowded.
2) Check-in and luggage storage
Check in at the airline counter and get a boarding pass. The items that you are claiming for a VAT refund and the related documents must be on you, not in your checked baggage.
If you wish to check in items as checked baggage, please inform the airline staff that there are items that are eligible for VAT refund in your checked baggage at check-in. You can attache a tag to your luggage for customs verification and return it to your luggage, then visit the customs declaration desk. There is a place to drop off your luggage at the customs check point.
3) Using the self refund machine at the airport terminal (if your refund amount is less than 75,000 KRW)
You can select your language at the kiosk, scan your passport and get your refund slip.
Check if the item needs to be checked by customs. If customs check is not required, you can collect cash after the security check.
(KIOSK in general areas only scan receipts. Refunds can only be collected at duty-free kiosk machines or refund counters after security check)
Cases where you are subject to a customs check at the self-refund machine
In most cases, refunds are processed via the kiosk, but there are rare cases when you may be subject to customs inspection under certain conditions or random selection.
If you are selected for inspection, present your passport, relevant items, receipt, and Tax Refund Form at the customs declaration counter located opposite, and then receive a customs export confirmation stamp.
4) Refund after airport customs inspection (if the refund amount is more than 75,000 KRW)
Items with a refund amount of 75,000 KRW or more and items that are carried by travelers with a Korean passport who have lived abroad for 2 years or more are subject to mandatory customs checks.
Alternatively, you can receive a refund after customs inspection even if the receipt was previously scanned by KIOSK and found to be subject to customs inspection.
1. Bring your passport, purchased items (unopened and unused items) receipts, and VAT refund documents to the customs counter and check them, and then get a stamp of export confirmation on the VAT refund documents.
You can visit the VAT refund counter, submit theVAT refund document stamped with the customs confirmation stamp and collect cash immediately on the spot. If you arrive outside the operating hours of the refund window, please submit the relevant documents to the refund mailbox after receiving the customs confirmation stamp. After a period of time, the refund will be credited to your money order.
How to get a refund in the city
City refunds mainly exist in major tourist areas and require a credit card for guarantee. If you paid in cash, you can get a cash refund on the spot, but the tax refund amount will be temporarily paid by the credit card. Do not worry, it is a tax refund guarantee, so it automatically, will get refunded once verified.
After purchasing the item at the tax free store, you will receive a refund slip (it is the same thing as a refund document).
Bring your passport, refund slip, and credit card to collect refunds at manned refund office or unmanned refund machines in the city.
In the case of Global Tax Free, only refund slips with a purchase amount of 30,000 KRW or more and less than 5 million KRW can be refunded.
The refund amount limit for Global Blue is 390,000 KRW in certain parts of the city.
Proof of a tax refund must be presented at the airport. (When leaving the country, present the purchased items, refund documents, and passport to customs for confirmation.)
A credit card is required as a guarantee for your tax refund.
You must leave Korea within 3 weeks of receiving your tax refund. It is important to note that only items purchased from affiliated stores of each company can be refund at other tax refund windows other than airports or ports. (ex. After purchasing goods at a global tax free affiliate store, refund is possible at the global tax free city refund counter)
Again, the amount paid will be refunded only after verification is complete. Do not throw away the proof of tax refund. Take care of it and present it at the airport.
Incheon Airport Tax Refund
Incheon Airport Terminal 1, 3F
Location: Near Gate 28 in the duty-free area, near B and E in the east general area, near J and L in the west general area, in the center of the 3rd floor concourse. A kiosk is located in the general area near the check-in area, and you can check whether the kiosk is subject to customs declaration by scanning the refund slip and passport.
If the item is over 75,000 KRW or is marked as subject to customs check in kiosk, go to the customs declaration counter opposite or right next to it. If you have luggage that needs to be declared for customs, you can check in the luggage here after checking customs.
Incheon Airport Terminal 2, 3F
Location: Near check in D and E, near gates 250, 249, 253, in the duty free area. Kiosk is located in the general are near the check in area. check if the kiosk is subject to customs declaration. If the item is over 75,000 KRW or is marked as subject to customs check in, go to the customs declaration area opposite. You can check in your luggage there.
After your security check, you can collect cash in the lounge opposite Gate 249.
FAQ
1) Please tell me the location of refunds at international airports other than Incheon.
Gimpo Airport: Gates 1,2,3, on the 2nd floor in front of Lotte Duty Free shop on the 2nd floor.
Gimhae Airport: Counter B26 on the 2nd floor
Jeju Airport: Gate 5 on the 3rd floor
2) Where is the refund location in the city?
There are many refund areas all over the city. If you shop at a tax free department store, the best way to check is to see if there is a refund desk inside the department store.
3) How much tax can I get?
The refund amount will be calculated based on the amount spent, VAT and the service charge of the refund agency applicable to the purchase. Therefore, most of the VAT in Korea is 10%, but if the service charge of the refund agency is deducted from this, you will be able to get a refund of about 4-7%.
Service charges may be calculated differently depending on the refund agency, goods, or the amount of foods, so it is recommended to check the exact refund amount at the refund window. For example, if you refunded in cash at Global Tax Free agency it will look like this:
Purchase Amount | Refund |
₩30,000-₩49,999 | ₩2,000 |
₩50,000-74,999 | ₩3,000 |
₩75,000-₩99,999 | ₩5,000 |
₩100,000-₩124,999 | ₩7,000 |
₩125,000-₩149,999 | ₩8,000 |
₩150,000-₩174,999 | ₩9,000 |
₩175,000-₩199,999 | ₩10,000 |
₩200,000-₩224,999 | ₩12,000 |
4) How can I get a refund?
If you receive payment in cash, you will be able to get a refund in your own country's currency as it is not only paid in just Korean currency. However in the case of non-Korean currency, the refund amount may be smaller in the process of being converted to another national currency.
Refund agencies are processing refunds not only in cash, but also in various payment methods.
Global Blue: Alipay, Paypal, Mastercard, Unionpay, VISA, American Express, Bank Transfer, JCB
Global Tax Free: Cash, Cards issues outside Korea (VISA, Mastercard, JCB, Unionpay) Alipay, WeChat, QQ, etc.
Summary
Duty Free
You must present your passport. Since the product price itself is already a tax free price, you can pay the tax free price. You must check whether the total amount of your purchases exceeds the reporting threshold.
If your tax refund is less than 75,000 KRW
You can receive a tax refund immediately on the spot.
You can get a refund at the tax refund counter in the city.
- Receive refund slips and receipts at the store.
- Claim your refund at the city tax refund machine
- Credit Card
- You must present proof of tax refund at the airport
You can get a refund at the airport (bring your passport, unused items, refund slip, and receipt)
For items that can be carried on board, first check whether they are subject to customs declaration at the kiosks near the check in counter. If you are not subject to customs check, please get a refund at the tax-free local refund office after security check. If it is marked as subject to customs check, go through the security check after getting it checked at the customs declaration counter opposite.
In the case of luggage, do not leave luggage at check-in, attach luggage tag and go to the customs declaration area. After customs check, please use the luggage storage area next to it.
If the tax refund is more than 75,000 KRW
You cannot get a refund in the city, get a tax refund at the airport.
Carry-on items are subject to customs inspection after security screening. If you need to attach baggage, please attach baggage after inspection at the tax refund counter before security check.
We hope that this information was helpful for your tax refunds in Korea! If you need a tax refund for hotels in Korea, click here for 2022 Hotel Tax Refunds. Please leave a comment below or send us an email at help@creatrip.com if you have any questions or concerns. Also make sure to follow us on Instagram, TikTok, and Facebook to stay updated on all things Korea!
