Severance Pay Estimate Calculator
Severance Pay Estimate Calculator helps you simulate statutory severance pay references from work period and wage assumptions.
- Finance, tax, salary, and settlement outputs are simple estimates from your inputs. Check official rules or a professional before filing, investing, borrowing, or contracting.
Severance Pay Estimate Calculator helps you simulate statutory severance pay references from work period and wage assumptions.
Example Severance Pay Estimate Calculator result Average daily wage: 114,130 Severance: 12,129,094 Retirement and local income tax: 144,190 After tax: about 11,984,904 Next step: Pension plan type and IRP transfer change the payout timing and tax, so confirm with your employer.
How to use Severance Pay Estimate Calculator
Estimates Korean statutory severance pay and retirement income tax from the start date, leaving date and wages for the final three months.
Severance equals average daily wage × 30 days × (days employed ÷ 365); tax uses the service-year and converted-pay deductions for retirements from 2023.
- Select the start date and the leaving date (the day after the last working day).
- Enter the total gross wages paid during the three months before leaving.
- Optionally add last year's bonuses, unused-leave pay and the daily ordinary wage in advanced settings.
- Review severance before and after tax together with the calculation steps.
Useful for
- Estimating severance and tax before choosing a resignation date
- Checking that an employer's severance figure is not below the statutory minimum
Limits and checks
- The averaging period is the calendar days of the final three months (89 to 92), so timing slightly changes the result.
- Receiving severance into an IRP account defers retirement income tax until pension withdrawal.
Worked example
Employee with three and a half years of service
Start date: 2023-03-02 Leaving date: 2026-09-15 Wages for final three months: 10,500,000 Bonus and leave pay: 0
The averaging period runs from 2026-06-15 to 2026-09-14, which is 92 days.
Severance and tax estimate
Average daily wage: 114,130 Severance: 12,129,094 Retirement and local income tax: 144,190 After tax: about 11,984,904
Partial years are rounded up, so four service years are used for tax.
Common issues
It says I am not eligible after more than a year
Use the day after your last working day as the leaving date. At least 365 days of continuous service are required.
The amount differs from my employer's figure
Compare which allowances were included, whether bonuses and leave pay were added, and whether a DB or DC pension plan applies.
How to interpret the result
First confirm that the daily average wage and service days match your employer's records.
Related workflow
Pension plan type and IRP transfer change the payout timing and tax, so confirm with your employer.
Privacy and review notes
Dates and wage amounts are processed only in your browser and kept in the page address for sharing. ToolBada does not receive or store them.
Basis and limitations
Basis
- The tool applies user-entered amounts, periods, rates, and selected conditions to the calculation described on the page.
- The displayed result is a reference estimate based on that tool's formula and stated input assumptions.
Limitations
- Actual tax rules, deductions, exchange rates, fees, institution policies, and market prices can change by date and personal case.
- Do not use the output as the final basis for filing, investing, borrowing, contracting, salary negotiation, or legal commitments.
Official check
- Before filing or making financial decisions, verify with official agencies, financial institutions, exchanges, or qualified experts.
References and methodology
- Official external source: Korea Ministry of Employment and Labor — The official source for current Korean wage, severance, employment-insurance, and leave rules.
- Official external source: FSS Financial Consumer Information Portal — The Financial Supervisory Service portal for final checks on financial products and transactions.
Review scope: We automatically check that the calculation basis and official source links are shown. No licensed medical, legal, or tax professional has reviewed this result individually, so confirm with the responsible agency or a professional before an important decision.
FAQ
How is severance calculated?
Total wages for the final three months are divided by the days in that period, then multiplied by 30 days and by days employed ÷ 365. If ordinary wages are higher, they are used instead.
How much retirement income tax applies?
A service-year deduction is removed, the rest is annualised, a converted-pay deduction applies, basic rates are charged and the result is scaled by service years ÷ 12, plus 10% local tax.
Are bonuses included?
Regular bonuses paid during the last year add three twelfths to the averaging wages. Enter the annual total in the bonus field.