ISA vs Pension Savings: Comparison Table of Eligibility, Limits, Taxation and Withdrawals
The box to check is the scheme comparison table: eligibility, contribution limits, contract and payout periods, taxation, withdrawal and termination, and lookup channels. The "which is better" and return boxes are not opened. The reference date is 2026-08-18. The Restriction of Special Taxation Act is Act No. 21223 (2025.12.23.) and the Income Tax Act is Act No. 21221 (2025.12.23.). The article pages for Article 91-18 and Article 59-3 show an effective date of 2026.1.1., and Enforcement Decree Article 40-2 shows 2026.7.1.
This post covers Korean tax rules, and the linked official sources are in Korean.
1. Two boxes for the official names
| Box | Individual Savings Account (ISA) | Pension savings account |
|---|---|---|
| Statute | Restriction of Special Taxation Act Article 91-18 | Income Tax Act Articles 20-3 and 59-3, Enforcement Decree Article 40-2 |
| Official name | Individual Savings Account | An account established under the name "pension savings" (pension savings account) |
| Account type | Contract with an investment broker / contract with a discretionary investment manager / specified money trust with a trust business entity | Trust contract, collective investment securities brokerage contract, insurance contract. Ministry of Government Legislation: pension savings trust, pension savings fund, pension savings insurance |
ISA paragraph 3, item 2: the account is named Individual Savings Account and is one of the contracts with an investment broker under Article 8(3) of the Financial Investment Services and Capital Markets Act, a discretionary investment manager under paragraph 6 of the same article, or a trust business entity under paragraph 7 of the same article. (S1)
The HTML of the Financial Services Commission's 2021 press reference page (S10) has no sentence on account types. A reprint of the same press reference's attachment writes "choose one of trust, discretionary or brokerage (securities) type (one account per person)." The types are the same as Article 91-18(3)2. This is not product selection.
A pension savings account is, under Income Tax Act Article 20-3(1)2, "an account prescribed by Presidential Decree that is established under the name 'pension savings'." Enforcement Decree Article 40-2(1)1 lists (a) trust contracts, (b) collective investment securities brokerage contracts and (c) insurance contracts. Ministry of Government Legislation note 1): sales of pension savings trusts stopped from 2018. (S5, S6, S12)
IRP is not a third column. Income Tax Act Article 20-3(1)2 calls an account established to receive retirement pension a "retirement pension account." National Tax Service: retirement pension accounts are DC, IRP, the SME retirement pension and the Korea Scientists and Engineers Mutual-aid Association (excluding employer contributions). The tax credit limit is 9 million won a year for pension savings contributions within 6 million won combined with retirement pension contributions. (S3, S5)
2. Eligibility
ISA Article 91-18(1). (S1)
| Box | Original text |
|---|---|
| Age 19 | A person aged 19 or older as of the date of enrollment or extension |
| Age 15 + employment | A person aged 15 or older as of the date of enrollment or extension who had earned income in the taxable period immediately before the taxable period containing the date of enrollment or extension (excluding a person who had only non-taxable income) |
| One account per person | Hold only one account per person (paragraph 3, item 1) |
The original text of the requirement excluding those subject to comprehensive taxation of financial income (Restriction of Special Taxation Act Article 129-2, Enforcement Decree Article 93-4) could not be confirmed on the pages this post opened. [source needed]
The requirements for the 4 million won tax-free limit for low-income earners and farmers and fishers are in paragraph 2, item 1. (S1)
| Category | Requirement |
|---|---|
| 4 million won (a) | A resident whose total salary in the previous taxable period was 50 million won or less (limited to a person who in the previous taxable period had only earned income, or earned income plus global income not included in the global income tax base) |
| 4 million won (b) | A resident whose global income amount included in the global income tax base in the previous taxable period was 38 million won or less (limited to a person whose total salary in the previous taxable period did not exceed 50 million won) |
| 4 million won (c) | Farmers and fishers prescribed by Presidential Decree (excluding a person whose global income amount included in the global income tax base in the previous taxable period exceeded 38 million won). Original text of the farmer and fisher definition [source needed] |
| 2 million won | A person who does not fall under item 1 |
The subject of the pension savings tax credit is "the amount paid into a pension account by a resident with global income." There is no minimum age for opening an account in this article. "Anyone can enroll" is not written here. (S2)
3. Contribution limits
Original text of ISA paragraph 3, item 5: "The total contribution limit shall be 100 million won or less (for a resident who has enrolled in property formation savings under Article 91-14 or long-term collective investment securities savings under Article 91-16, the amount after subtracting the total contract amount of the property formation savings and long-term collective investment securities savings), and the annual contribution limit shall be the amount under the following formula." (S1)
The original text of the formula box was not displayed on the law.go.kr page this post opened. The annual figure in the main table is left blank.
The Korea Financial Investment Association's practice guidelines state that "the annual contribution limit is 20 million won and the unpaid limit is … 20 million won × [1 + years elapsed since enrollment (4 years if 4 years or more)]." The Financial Services Commission's 2021 press reference says "20 million won a year (100 million won in total) * unpaid amounts can be carried forward within the 5-year limit (from '21)." These are not mixed in one box with the statutory formula. (S14, S10)
The pension account contribution limit is 18 million won a year. With two or more accounts, it is the total. Under Enforcement Decree Article 40-2(2)1(c) and (d), the total cumulative amount paid into pension accounts is limited to 100 million won. (S6, S12)
The tax credit limit is a different box from the contribution limit. Proviso to Income Tax Act Article 59-3(1): "Where the amount paid into pension savings accounts exceeds 6 million won a year, the excess shall be deemed not to exist, and where the sum of the amount within 6 million won paid into pension savings accounts and the amount paid into retirement pension accounts exceeds 9 million won a year, the excess shall be deemed not to exist." (S2, S3)
4. Mandatory period and contract period
ISA paragraph 3, item 4: "The contract period shall be 3 years or more." Paragraph 4: "The account holder may extend the contract period of the account before the contract period expires." The current statutory text has no cap on the number of extensions. Paragraph 11: if, on or after the day 3 years from the first contract date, all or part of the balance is paid into a pension account under Income Tax Act Article 59-3(3), "the contract period shall be deemed to have expired." (S1)
Pension receipt is a withdrawal that meets all three conditions in Enforcement Decree Article 40-2(3). It is not "5 years of contributions" but "withdrawal after 5 years have passed since enrollment." (S5, S6, S12)
| # | Condition |
|---|---|
| 1 | Withdraw after the subscriber, aged 55 or older, applies to the pension account provider to start pension receipt |
| 2 | Withdraw after 5 years have passed since the date of enrollment (except where there is deferred retirement income) |
| 3 | Withdraw within the pension receipt limit |
5. Taxation
The rate boxes show the national income tax itself. Local income tax for individuals is 10/100 of the withheld income tax under Local Tax Act Article 103-13. A combined "effective rate" with the national tax is not given. (S9)
ISA paragraph 1: no income tax is levied on the sum of interest income and dividend income up to the tax-free limit, and the amount above it is taxed at 9/100 notwithstanding Income Tax Act Article 129 and is not included in the global income tax base under Article 14(2) of that Act. (S1)
The article covers interest income and dividend income. The box for capital gains on domestic listed shares is left blank.
Pension account tax credit: "12/100 [… 15/100 for a resident whose global income amount is 45 million won or less (total salary of 55 million won or less if the resident has only earned income)]." (S2, S3)
Transferring to a pension account after ISA maturity falls under Article 59-3(3) and (4). The smaller of 10/100 of the transferred amount or 3 million won (where paid across the previous and current taxable periods, 3 million won minus the amount applied in the previous taxable period) is added to the limit. National Tax Service: "The tax credit limit is expanded by 10% of the transferred amount, up to 3 million won. The additional limit for the ISA transfer amount applies only in the year the ISA maturity balance is paid into the pension account." Restriction of Special Taxation Act Article 91-18(11): the payment must be made on or after the day 3 years from the first contract date for the contract period to be deemed expired. (S2, S3, S1)
Withholding on pension receipt (Income Tax Act Article 129(1)5-2, reflecting the 2025.12.23. amendment). (S8)
| Age / contract | National tax |
|---|---|
| Under 70 | 5/100 |
| 70 or older and under 80 | 4/100 |
| 80 or older | 3/100 |
| Lifetime contract (Presidential Decree) | 3/100 |
The 15 million won a year for private pensions is Income Tax Act Article 14(3)9(c). "Pension income, where the total of pension income other than items (a) and (b) is 15 million won or less a year," is not included in the global income tax base (except where a resident with item (c) income chooses to include it). (S7)
Article 64-4: a resident with pension income other than separately taxed pension income chooses either the determined global income tax, or the amount obtained by multiplying that pension income by 15/100 plus the determined tax on the other global income. Which is more advantageous is not stated. (S7)
6. Withdrawal and termination
ISA paragraph 8: "Where an amount exceeding the total paid in during the contract period is withdrawn before the day 3 years from the date the contract was first concluded, the contract shall be deemed terminated early on the date of withdrawal, and paragraphs 5 to 7 shall apply." (S1)
Paragraph 7: where the contract is terminated before the day 3 years from the date the contract was first concluded (except termination for unavoidable reasons prescribed by Presidential Decree, such as the account holder's death or emigration), the tax equivalent to the income tax that received the special taxation must be collected under Article 146-2. Full list of special termination reasons: [source needed]. (S1)
Non-pension receipt is other income. Income Tax Act Article 21(1)21, Article 129(1)6(b): 15/100. Article 14(3)8(b): other income from non-pension receipt is separately taxed other income. (S8, S12)
The order of partial withdrawals is in Enforcement Decree Article 40-3: amounts excluded from taxation → deferred retirement income → amounts eligible for the tax credit. Amounts excluded from taxation include contributions in the current taxable period, transferred amounts, amounts above the tax credit limit, and amounts confirmed as not having received the tax credit. (S6)
List of unavoidable reasons for pension receipt (Enforcement Decree Article 20-2): [source needed].
7. Eligible investment assets (ISA)
Only the items of Restriction of Special Taxation Act Article 91-18(3)3. (S1)
| Item | Original text |
|---|---|
| (a) | Deposits, installment savings, deposits held in custody and other similar financial products prescribed by Presidential Decree |
| (b) | Collective investment securities of collective investment vehicles under Income Tax Act Article 17(1)5 (excluding foreign collective investment securities under Article 279(1) of the Financial Investment Services and Capital Markets Act) |
| (c) | Derivative-linked securities or derivative-linked bonds under Income Tax Act Article 17(1)5-2 |
| (d) | Securities or certificates taxed under Income Tax Act Article 17(1)9 |
| (e) | Shares of stock-listed corporations under Income Tax Act Article 88, item 3 |
| (f) | Other property prescribed by Presidential Decree |
The investment scope of pension savings is the scope set by the contract type. Product groups without an original text are not listed.
8. Comparison table (current · 2026-08-18)
| Box | Individual Savings Account (ISA) | Pension savings account |
|---|---|---|
| Statute | Restriction of Special Taxation Act §91-18 | Income Tax Act §20-3, §59-3, Enforcement Decree §40-2 |
| Official name | Individual Savings Account | Account under the name "pension savings" (pension savings account) |
| Account type | Contract with an investment broker / contract with a discretionary investment manager / specified money trust with a trust business entity. One per person | Trust contract, collective investment securities brokerage contract, insurance contract. Ministry of Government Legislation: pension savings trust, fund, insurance. Trust sales stopped from 2018 (everyday law information note) |
| Eligibility | Aged 19 or older as of the enrollment or extension date, or aged 15 or older + earned income in the previous taxable period (excluding a person with only non-taxable income). Comprehensive taxation of financial income: [source needed] | Tax credit: a resident with global income. No minimum age for opening an account in this article |
| Per-person limit | One account per person | Multiple accounts allowed. Contribution and credit limits are combined (Enforcement Decree §40-2(2)) |
| Annual contributions | Formula in Act §91-18(3)5. Original text of the formula box not displayed | 18 million won a year (total of multiple accounts). Cumulative limit of 100 million won for specific items (original text of the Decree) |
| Total contributions | 100 million won (minus the contract amounts of property formation savings and long-term collective investment securities savings) | Separate from the tax credit limit. Only the annual contribution limit is locked in |
| Contract and mandatory period | Contract period of 3 years or more | Pension receipt: application to start at age 55 or later + 5 years since the enrollment date + within the receipt limit |
| Taxation (on contribution) | No tax credit on contributions (the article does not provide one) | Credit rate 12%; 15% for global income of 45 million won or less (total salary of 55 million won or less if only earned income). Pension savings 6 million won, 9 million won combined with retirement pension |
| Taxation (returns and withdrawals) | Sum of interest and dividends: tax-free 2 million won (4 million won if the low-income or farmer/fisher requirements are met), 9% above that, not included in global income | Pension receipt: under 70 5%, 70 to under 80 4%, 80 or older 3%, lifetime contract 3%. Non-pension receipt: other income 15% |
| Private pension 15 million won | No such box | §14(3)9(c) exclusion-from-aggregation sentence + §64-4 choice of 15%. No judgment on which is better |
| ISA→pension | Deemed to have matured when all or part of the balance is paid in 3 years or more after the first contract date. Credit limit expanded by the smaller of 10% of the transferred amount or 3 million won (in the year of payment) | The transferred amount is included in pension account contributions for that taxable period |
| Early withdrawal and termination | Withdrawal above total contributions before 3 years = deemed early termination → collection of the specially taxed amount (§146-2) | Withdrawal not meeting the pension receipt conditions = non-pension receipt. Tax-credited portion and investment gains are other income at 15% |
| Investment assets | Only the items of Act §91-18(3)3 | The scope set by the contract type |
| Lookup | ISA Damoa, Hometax income confirmation certificate (for Individual Savings Account enrollment) | Integrated Pension Portal, FINE pension savings comparison disclosure, Hometax year-end settlement |
Footnote: local income tax for individuals is 10/100 of the withheld income tax under Local Tax Act Article 103-13. A combined "effective rate" with the national tax is not given.
9. Lookup channels
| Channel | URL | What the original says it does |
|---|---|---|
| National Law Information Center | https://www.law.go.kr | Restriction of Special Taxation Act §91-18; Income Tax Act §20-3, §59-3, §14, §21, §64-4, §129; Enforcement Decree §40-2, §40-3; Local Tax Act §103-13 |
| National Tax Law Information System | https://taxlaw.nts.go.kr | Three-level view of the same articles |
| National Tax Service tax credit guide | https://www.nts.go.kr/nts/cm/cntnts/cntntsView.do?cntntsId=7875 | Pension account tax credit table, ISA transfer 10% / 3 million won |
| Hometax | https://hometax.go.kr | Income confirmation certificate (for Individual Savings Account enrollment). For the menu click path, search Hometax by the certificate name |
| Integrated Pension Portal | https://100lifeplan.fss.or.kr | Pension savings comparison disclosure, IRP account guide, my pension lookup |
| FINE pensions | https://fine.fss.or.kr/fine/main/contents.do?menuNo=900502 | Entry point for pension savings and retirement pension comparison disclosures |
| ISA Damoa | https://isa.kofia.or.kr , https://dis.kofia.or.kr | Comparison disclosure of trust-type fees and discretionary-type model portfolios. Return figures are not copied into this post |
| Ministry of Government Legislation everyday law information | https://easylaw.go.kr/CSP/CnpClsMain.laf?ccfNo=3&cciNo=2&cnpClsNo=1&csmSeq=2056&popMenu=ov | Pension savings names, receipt conditions and tax credit table. As of 2026.7.15. |
The Korea Federation of Banks comparison disclosure URL could not be confirmed in the first round, so it is not in the channel table.
10. History box (at the time)
This is not mixed with the main table.
| Time | What the original says | Source |
|---|---|---|
| At introduction, 2015-09-16 | 20 million won a year, 100 million won in total over 5 years, no carry-forward, 5-year maturity, 5-year mandatory period (3 years for youth and certain income levels), enrollment = earned or business income, those subject to comprehensive taxation of financial income excluded, tax-free 2 million won and 9% above that | S11 |
| 2021-07-26 / announced as effective 2023.1.1. | Minimum contract 3 years with extensions allowed, carry-forward of unpaid amounts, new brokerage type, separate taxation 14%→9%, tax-free 2 million / 4 million won kept, 20 million won a year and 100 million won in total kept. "Tax-free returns on listed shares and public equity funds" differs from current paragraph 1 (interest income and dividend income) and is not in the main table | S10 |
| Income Tax Act amendment of 2022.12.31. | Pension savings tax credit limit 6 million won, combined 9 million won (previously 4 million / 7 million) | S2 |
| Income from 2024.1.1. onward | Private pension separate taxation threshold 12 million won→15 million won. The main table shows only the current 15 million won | S7, S12 |
11. 2026 tax reform proposal (not yet enacted)
The Ministry of Finance and Economy finalized and announced the "2026 tax reform proposal" at the Tax Development Council on 2026-08-03. (S17)
The stated aim is to create a productive-finance ISA and overhaul the existing ISA. It has not been passed by the National Assembly. It is not mixed with the figures in the main table.
Sources
- [S1] Restriction of Special Taxation Act Article 91-18 (Act No. 21223, article page effective 2026.1.1.). https://www.law.go.kr/lsLawLinkInfo.do?chrClsCd=010202&lsJoLnkSeq=1000928713
- [S2] Income Tax Act Article 59-3 (Act No. 21221, article page effective 2026.1.1.). https://www.law.go.kr/lsLawLinkInfo.do?chrClsCd=010202&lsJoLnkSeq=1001059881
- [S3] National Tax Service "Tax credits" — pension account tax credit. https://www.nts.go.kr/nts/cm/cntnts/cntntsView.do?cntntsId=7875
- [S4] Enforcement Rule of the Income Tax Act, Form No. 37(1), notes. The article home URL is not used. Open the form from the National Tax Service or the Law Information Center annex forms.
- [S5] Income Tax Act Article 20-3. The definition of a pension savings account is in Article 20-3(1)2. Deep link: check in the same Income Tax Act view as Article 59-3.
- [S6] Enforcement Decree of the Income Tax Act Article 40-2 (effective 2026.7.1.). https://www.law.go.kr/LSW/lsLawLinkInfo.do?chrClsCd=010202&lsId=003956&lsJoLnkSeq=1000656323&print=print
- [S6b] Enforcement Decree of the Income Tax Act Article 40-3. https://www.law.go.kr/lsLawLinkInfo.do?chrClsCd=010202&lsJoLnkSeq=1001061005
- [S7] Income Tax Act Articles 14 and 64-4. https://www.law.go.kr/LSW/lsLawLinkInfo.do?chrClsCd=010202&lsId=001565&lsJoLnkSeq=1000821599&print=print
- [S8] Income Tax Act Article 129. https://www.law.go.kr/LSW/lsLawLinkInfo.do?chrClsCd=010202&lsId=001565&lsJoLnkSeq=1000821176&print=print
- [S9] Local Tax Act Article 103-13. https://www.law.go.kr
- [S10] Financial Services Commission, Individual Savings Account (ISA) tax reform and expected effects, 2021-07-26. https://www.fsc.go.kr/no010101/76304
- [S11] Financial Services Commission, Q&A on the plan to introduce the Individual Savings Account (ISA), 2015-09-16. https://www.fsc.go.kr/po020201/27339
- [S12] Ministry of Government Legislation, Easy-to-Find Everyday Law Information "Pension savings" (as of 2026.7.15.). https://easylaw.go.kr/CSP/CnpClsMain.laf?ccfNo=3&cciNo=2&cnpClsNo=1&csmSeq=2056&popMenu=ov
- [S13] Financial Supervisory Service Integrated Pension Portal — individual IRP account guide. https://www.fss.or.kr/fss/lifeplan/bnacJoin/list.do?menuNo=200954
- [S14] Korea Financial Investment Association, practice guidelines for trust-type and brokerage-type Individual Savings Accounts. https://law.kofia.or.kr
- [S15] Korea Financial Investment Association ISA Damoa. https://isa.kofia.or.kr , https://dis.kofia.or.kr
- [S16] Financial Supervisory Service FINE "Pensions". https://fine.fss.or.kr/fine/main/contents.do?menuNo=900502
- [S17] Ministry of Finance and Economy, announcement of the "2026 tax reform proposal" (reprinted by KDI), 2026-08-03. https://eiec.kdi.re.kr/policy/materialView.do?num=285041
- [S18] Financial Investment Services and Capital Markets Act Article 8. Cited by Article 91-18(3)2. The home URL is not used.