What is the difference in tax rates based on age when receiving pension payments?

When receiving pension payments, the tax rates applied to your pension income vary based on your age at the time of receipt. This applies to the portion of your pension that is taxable, which generally includes amounts from contributions that received tax deductions and any investment gains within the pension account.

Here are the tax rates based on age:

• Ages 55 to 69: A tax rate of 5.5% (including local income tax) is applied.
• Ages 70 to 79: A tax rate of 4.4% (including local income tax) is applied.
• Ages 80 and older: A tax rate of 3.3% (including local income tax) is applied.

It's important to note that if your total annual pension income exceeds 15 million KRW, it may be subject to comprehensive income tax, where it's aggregated with your other income. However, pension income derived from deferred retirement income is taxed separately regardless of the amount.