Enter your start date, last working day and the gross wages from your final three months, and this calculator works out the average daily wage and the days of continuous service to estimate statutory severance pay in Korea before tax. Bonuses and unused-leave pay are counted at three months' worth, and a higher ordinary wage replaces the average wage when you provide it. The calculation period and every number used are shown so you can check the result yourself. Everything runs in your browser.
Employment period
The retirement date is set automatically to the day after your last working day.
Pay before leaving
Enter your dates and the wages from your last three months to see the estimate.
Statutory severance is the average daily wage multiplied by 30 days, multiplied by the days of continuous service, divided by 365. Continuous service runs from your start date to your retirement date, and the retirement date is the day after your last working day. That is why this calculator only asks for the last working day: it converts the retirement date for you.
The average wage is the pay you received in the three months before leaving, divided by the total number of days in that period. Those days are calendar days including weekends and holidays, not the days you actually worked. So the same pay produces a slightly different average wage in a period of 89 days than in one of 92 days.
Pay that accrues over a longer span, such as an annual bonus or unused-leave allowance, counts toward the average wage at three months' worth. This calculator multiplies each by 3/12 and adds it to the period's wages. If the resulting average wage is lower than your ordinary wage, severance is calculated on the ordinary wage instead, so enter your daily ordinary wage when you know it.
Certain periods are excluded from the average wage calculation, including parental leave, maternity leave and absence from a work injury. When such a period overlaps your final three months, the excluded days and the pay for them are removed before the average is taken, so check with your payroll team rather than relying on this estimate.
What people call severance in Korea covers several different retirement benefit schemes. Under the classic severance scheme, the employer pays out at the end of employment based on continuous service and the average wage.
A defined benefit (DB) plan fixes the level of benefit the employee will receive in advance. The employer sets aside and invests the funds with a financial institution and bears the investment risk. Because the payout is worked out the same way as classic severance, the result from this calculator is a reasonable reference for a DB plan.
A defined contribution (DC) plan works the other way round: each year the employer pays a set amount, based on the employee's total annual wages, into the employee's retirement account. The employee invests those funds, so the amount available at retirement depends on the contributions made and on investment gains or losses.
If your employer runs a DC plan, the wages of your last three months do not determine what you receive. Use this calculator only to get a sense of scale, and check the actual balance of your retirement pension account.
IRP stands for Individual Retirement Pension, a pension account that receives retirement benefits and lets you keep benefits from several employers in one place.
Since 14 April 2022, employers in Korea have as a rule been required to pay retirement benefits into an IRP account nominated by the employee. That is why companies ask departing staff for an IRP account number. There are statutory exceptions, including retirement at or after age 55 and a retirement benefit of 3 million won or less.
Receiving severance into an IRP does not lock the money away for good. You can withdraw it as a lump sum later, or, if you meet the conditions, draw it as a pension in instalments. Which route you take changes the tax.
Transferring severance into an IRP defers the retirement income tax: instead of paying at the moment you leave, tax is charged when you actually withdraw from the account.
Withdrawing the money as a lump sum triggers retirement income tax. Drawing it as a pension, once the conditions are met, applies a lower rate to the deferred retirement income. As of 2026, deferred retirement income drawn as a pension is taxed at roughly 70% of the non-pension rate for the first 10 years of actual pension receipt, 60% beyond 10 years and up to 20 years, and 50% beyond 20 years.
In other words, the longer you draw it as a pension, the lighter the tax on the retirement income. If you do not need the money immediately, it is worth comparing the tax on pension withdrawals against a lump sum.
The severance transferred into your IRP by your employer does not qualify for the pension account tax credit, because the retirement income tax on it has already been deferred.
Money you pay into an IRP or a pension savings account yourself does qualify, up to a limit. Pension savings are capped at 6 million won a year, and the combined cap across pension savings and retirement pension accounts such as an IRP is 9 million won a year. The credit rate depends on income: 15% for total salary of 55 million won or less (global income of 45 million won or less) and 12% above that.
So an IRP does two jobs at once: it holds retirement benefits with the tax deferred while the money is invested for later, and it accepts your own contributions for a tax credit at year-end settlement or on your income tax return. The two amounts are taxed differently, so it helps to keep them apart in your head.
This is an estimate produced with the standard statutory formula. Actual severance depends on which allowances count as wages, on whether bonuses and leave pay are included, on periods excluded from the average wage, and on your employer's retirement benefit scheme.
If your employer runs a DC plan in particular, the payout is not set by your last three months of average wage at all. You need the contributions actually paid into the account and the investment result.
This calculator also does not compute retirement income tax. What you finally receive depends on that tax, which is based on years of service and the size of the benefit, and on how you draw the money from an IRP. For an exact figure, check with your payroll department or the official guidance from the Ministry of Employment and Labor and the National Tax Service.
The calculation period runs 2026-05-28 to 2026-08-27, which is 92 days, and three months' worth of the bonus (750,000) and leave pay (125,000) bring total wages in the period to 12,875,000. Continuous service is 2,005 days.
Three months' worth of a 3,000,000 bonus is 750,000, which spread over 92 days adds 8,152 to the daily wage. Multiplied across 2,005 days of service, that small daily difference moves the final figure a long way, so do not omit the bonus.
If months with few bonuses or allowances fall inside the calculation period, the average wage can drop below the ordinary wage. The ordinary wage then becomes the basis, so enter it whenever you know it.
Both conditions must hold: one year or more of continuous service, and an average of at least 15 hours a week over four weeks. The result panel names whichever condition failed.
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What it is, who it's for, how it works and why you'd use it.
A Severance Pay Calculator takes a start date, a last working day and the wages from the final three months of employment and returns the average daily wage, the days of continuous service and an estimate of Korean statutory severance pay before tax.
It is for employees planning to resign, people weighing when to change jobs, fixed-term and part-time workers, and small business owners who need to budget an employee's retirement payout.
The day after your last working day is treated as the retirement date, and continuous service is counted in days from your start date. The wages of the three calendar months before that date, plus three months' worth of annual bonuses and leave pay, are divided by the number of days in the period to give the average daily wage. If a daily ordinary wage is higher, it is used instead, and severance is the applied daily wage multiplied by 30, multiplied by days of service, divided by 365.
Severance in Korea depends on the wages of your final three months and on service counted by the day, not by whole years, so moving a resignation date by a few days changes the amount. This lets you compare scenarios in seconds.