KB Securities, Increasing Smart Tax-saving Investments through Brokerage-type ISA

KB Securities announced on the 5th that an increasing number of investors are actively utilizing the tax-saving benefits of their brokerage-type Individual Savings Accounts (brokerage-type ISA) after analyzing the investment status of customers managing brokerage-type ISA accounts.

Recently, the balance of brokerage-type ISAs has been rising sharply. According to disclosure data from the Korea Financial Investment Association, as of the end of June this year, more than 4.48 million customers and over 14.4 trillion KRW in funds have been accumulated in brokerage-type ISAs. Compared to the end of the previous year, the number of customers increased by 15%, and the balance grew by 54%, establishing brokerage-type ISAs as a leading tax-saving account in South Korea.

The popularity of brokerage-type ISAs is largely due to their strong tax benefits. Brokerage-type ISAs are tax-advantaged accounts that allow investment in various financial products within a single account. Interest and dividend income from investments within the brokerage-type ISA are tax-exempt up to 2 million KRW (or 4 million KRW for the basic-type ISA). Additionally, losses from stock investments within the account can be offset against income from bond interest or overseas investment funds, enabling investors to strategically maximize tax savings.

Looking at the investment status of KB Securities brokerage-type ISA investors as of the end of June, stocks accounted for the highest proportion at 41%, followed by overseas investment Exchange-Traded Funds (ETFs) at 19%, and bonds and repurchase agreements (RP) at 15%. Among stocks, those with high dividend yields such as Samsung Electronics (preferred shares) and Macquarie Infrastructure ranked at the top. For overseas investment ETFs, those tracking U.S. indices like TIGER U.S. S&P 500, TIGER U.S. Dividend Dow Jones, and TIGER U.S. Nasdaq 100 were among the top holdings.

A KB Securities representative stated, "With growing interest in brokerage-type ISAs, smart investors are increasingly investing in dividend stocks, overseas investment ETFs, and funds through brokerage-type ISAs to maximize tax-saving effects. If you opened an ISA for tax benefits, experiencing tax advantages through interest-bearing products like bonds or RPs first, then expanding your investment scope to more diverse assets is also an effective investment strategy."

Currently, KB Securities offers a special pre-tax annual 5% RP (180-day term) exclusively for brokerage-type ISA investors starting for the first time. Participation is limited to a maximum of 10 million KRW per person, and anyone who opens a new brokerage-type ISA account with KB Securities or transfers a brokerage-type ISA account from another company by August 30 can purchase it. Even customers who already have a brokerage-type ISA account with KB Securities can purchase it if their total deposit amount is 1 million KRW or less as of May 31.