"Going to Work as a Hobby"... Over 600,000 Employees Earning More Than 20 Million KRW Annually in Side Income Beyond Their Salary

3% of All Workplace Subscribers
4,100 People Within Insurance Premium Cap

It has been revealed that more than 600,000 health insurance workplace subscribers earn over 20 million KRW annually from additional income such as interest, aside from their monthly salary.

600,000 Workers Paying Health Insurance Premiums on Income Beyond Salary... 4,124 Paying Highest Level Premiums

According to data titled 'Status of Health Insurance Subscribers and Income Monthly Premium Payers (2019~2023)' received on the 8th from the National Health Insurance Service by Choi Hye-young, a member of the National Assembly’s Health and Welfare Committee from the Democratic Party of Korea, as of October 2023, there were 607,226 high-income workers who earned over 20 million KRW annually from interest, dividends, rental income, etc., excluding their salary, based on the health insurance premiums paid monthly.

These individuals pay an 'income monthly premium' separately from the 'wage monthly premium' (calculated by dividing the total annual wage by the number of months worked) applied to their salary. These workers bear an additional health insurance premium of about 200,000 KRW per month on average.

The number of workplace subscribers paying premiums on income beyond salary has increased every year from 194,738 in 2019 to 229,731 in 2020, 264,670 in 2021, 587,592 in 2022, and 607,226 as of October 2023. This accounts for about 3% of all workplace subscribers.

There is also a cap on the income monthly premium. In 2023, the upper limit for the income monthly premium is the same as the subscriber’s maximum wage monthly premium, which is 3,911,280 KRW per month. Applying last year’s health insurance premium rate (7.09% of income), this corresponds to an annual income of 681.99 million KRW and a monthly income of 56.83 million KRW. This means that these individuals earned more than 56.83 million KRW monthly from financial income, rental income, business income, or other 'additional income' excluding their salary.

As of October 2023, 4,124 workplace subscribers were paying this highest level of income monthly premium, accounting for 0.02% of all health insurance workplace subscribers.

Income Monthly Premium Applies Only to 'Excess Over 20 Million KRW Annually'... This Year’s Cap is 4,240,710 KRW

Meanwhile, the income monthly premium has been imposed since 2011 based on the National Health Insurance Act (Articles 69 and 71, etc.) only when comprehensive taxable income beyond salary exceeded 72 million KRW annually. However, in July 2018, the premium system was restructured, lowering the income threshold to 'over 34 million KRW annually.' This threshold was further reduced to 'over 20 million KRW annually' from September 2022 with the implementation of a two-step health insurance premium system reform.

However, to prevent excessive premium payments due to exceeding the threshold by just a few thousand KRW, additional premiums are only levied on the amount exceeding 20 million KRW. The cap on the income monthly premium will rise to 4,240,710 KRW per month this year. Converted to monthly income, this corresponds to about 61.48 million KRW, meaning annual additional income beyond salary exceeds 737.75 million KRW.