Year-End Tax-Saving Strategies Proposed by Samsung Securities: "ISA, Overseas Stocks, and Pension Savings"

As the year-end approaches, Samsung Securities has introduced a "tax-saving trio" to its clients. These are tax benefits available through the use of an Individual Savings Account (ISA), capital gains tax on overseas stocks, and retirement pension savings accounts.

According to Samsung Securities on December 17, an ISA offers tax exemption on income up to 2 million won (up to 4 million won for low-income accounts), with the excess subject to a separate 9.9% tax rate. Since tax benefits are available after just three years of mandatory holding, it is advantageous to open an account as soon as possible.

For investment products, it is beneficial to focus on dividend stocks or domestically listed overseas exchange-traded funds (ETFs), which are likely to generate significant taxable income. To receive additional benefits after closing the account, you can transfer the funds to a pension account after the mandatory holding period and receive a tax deduction. Furthermore, opening an ISA at the end of the year allows you to maximize the two-year annual contribution limit by making deposits in both December and January.

The next tip involves utilizing capital gains tax on overseas stocks. If you realize capital gains from overseas stocks within the year, you must report and pay the capital gains tax the following year. The taxable amount is calculated by multiplying the tax base by a 22% tax rate.

To save on taxes, you can offset gains and losses incurred within the same year to reduce the actual tax base. Alternatively, you can realize profits only up to the basic exemption amount (less than 2.5 million won), which is not subject to capital gains tax.

The final tip is to take advantage of retirement pension savings accounts. These accounts are a representative year-end tax benefit product for salaried employees. You can receive a tax deduction of 13.2% to a maximum of 16.5% on contributions of up to 6 million won per year.

If you invest in ETFs or funds through a retirement pension savings account, you do not have to pay taxes on the profits immediately, allowing for the benefits of long-term reinvestment.

A Samsung Securities representative stated, "The number of savvy investors seeking both investment and tax-saving effects by utilizing ISAs, capital gains tax on overseas stocks, and retirement pension savings accounts is increasing," adding, "We will continue to support long-term asset building through a variety of tax-saving products."