Published · 2026-10-25 · Last reviewed · 2026-10-25 · 7 min read

English · 한국어

Overseas lottery or prize wins and Korean tax

When news arrives of a big overseas lottery win, a resident of Korea may wonder: "If I won, how would Korean tax treat it?" and then ask: if foreign tax was already deducted, must I pay again in Korea, and who reports it and how? This page explains, only as far as it could be confirmed from statutes and National Tax Service guidance, the Korean tax structure when a Korean resident wins an overseas lottery or an overseas prize. The legality of buying, foreign tax rules and foreign-exchange reporting are either not covered or stated as unverified.

Not tax advice. This is general education; foreign income can change greatly with tax treaties and a person's residence status. Check with the National Tax Service or a tax professional before filing or deciding. This page does not encourage buying overseas lottery tickets or say that doing so is lawful. The verification basis is the Income Tax Act in force from 1 January 2026 (Act no. 21221).

1. Residents are taxed on income from everywhere

National Tax Service material summarises the scope of a resident's tax liability as all income arising inside and outside Korea (worldwide income), and a non-resident's as income arising in Korea (Korean-source income). We confirmed this through a summary of the Service's year-end settlement manual and did not open the text of article 3 of the Income Tax Act, so it is partly verified. How to decide who is a resident (days in Korea, occupation and so on) is not covered here. Everything on this page assumes a Korean resident.

The meaning of the principle is simple: a lottery prize received abroad can be subject to Korean tax law if it is the income of a Korean resident.

2. Classification: other income

Article 21(1)(2) of the Income Tax Act treats "money or goods received by winning a lottery, prize coupon or other draw ticket" as other income. The wording has no restriction to lotteries issued in Korea. Read literally, overseas lotteries and overseas prizes can fall under the same item. That is a reading of the wording and not a confirmed official interpretation on overseas lotteries. How such income is classified needs checking.

3. Three differences from a domestic lottery

The last two rows are derived by connecting the provisions above. Specifically, the National Tax Service states that "other income that was not withheld is added to the comprehensive income base", and separately records that Lottery Act lottery prizes end with withholding. Read together, an overseas lottery prize on which no Korean withholding has been taken appears to be added to a Korean resident's comprehensive income. This conclusion is a reading of the wording and we could not confirm an official interpretation.

4. When it is added to comprehensive income

If added, it is combined with the year's other income (employment, business and so on) and taxed at the comprehensive income rates (progressive rates under article 55 of the Income Tax Act). We confirmed that the rate table begins at 6% and has several bands up to 45% (45% above KRW 1 billion from the amendment record of article 55; 6% up to KRW 14 million from a National Tax Service table), but the middle bands differ between two National Tax Service tables, so this page does not print them. We therefore do not calculate the amount of tax. The structure is:

1. Convert the foreign prize into won (the conversion basis was not confirmed here).
2. Other income amount = receipts − necessary expenses. Whether the cost of buying a lottery ticket is a recognised expense is an item we could not confirm even for domestic lotteries, and still less for overseas ones.
3. Add the other comprehensive income to get the tax base and apply progressive rates.
4. If tax was paid abroad, apply the foreign tax credit (next section).

This aggregation means a large prize can raise tax substantially. Unlike a domestic lottery, which ends at 33% on the part above KRW 300 million, an overseas lottery is combined with other income at progressive rates. Which produces more tax depends on the amount and the other income, so one cannot say in general.

5. Tax already paid abroad: the foreign tax credit

Many countries withhold tax from lottery prizes first. Since two countries can then tax the same income, article 57 of the Income Tax Act provides a foreign tax credit. What we confirmed:

• A resident with foreign-source income can credit, up to a limit, the tax paid abroad on that income against Korean tax.
• According to a summary of a National Tax Service Q&A, the limit is comprehensive income tax multiplied by the foreign-source share of income. From a summary of article 57, credit exceeding the limit can be carried forward and credited within ten years of the following tax period.
• The claim is said to be made with the final comprehensive income tax return, with an application form and proof of the foreign payment.

All three are partly verified items seen in search summaries. The result can differ depending on whether an overseas lottery prize counts as "foreign-source income", whether the foreign tax is the kind of income tax eligible for credit, and whether there is a tax treaty. We did not confirm how many countries have a treaty with Korea or what any treaty says about lottery prizes.

Following the structure without numbers

An invented situation: a Korean resident wins an overseas lottery in some year and receives the amount after foreign tax has been deducted.

1. Convert the gross prize into won, and convert the foreign tax paid into won too.
2. No one in Korea paid it, so there is no Korean withholding.
3. In the final comprehensive income tax return for that year's income, add it as other income and compute tax at progressive rates together with other income.
4. Subtract the foreign tax paid as a foreign tax credit within the limit.
5. Pay the remainder.

Whether this order matches the real filing procedure, and what the deadline and forms are, we could not confirm. Check National Tax Service guidance on how a resident reports foreign income.

Beyond tax: things to check (not verified here)

• Foreign-exchange and financial reporting: bringing money received abroad into Korea or holding it in an overseas account may involve foreign-exchange transaction reporting and overseas financial account reporting duties. We did not check the relevant laws.
• Whether buying is lawful: whether it is permitted to buy an overseas lottery from Korea is outside this page and was not checked.
• Gifts: sharing winnings with others may raise gift-tax questions.
• Foreign rules: whether and at what rate each country withholds, and special rules for foreign winners, differ by country. You can find a starting point in this site's Prize tax by country, though that guide has not verified every detail of every country either.

Compared with domestic lotteries and prizes

A domestic lottery prize follows the rules in the lottery prize tax guide (tax minimum KRW 2 million, income tax 20% and 30%, local tax 10%, separate taxation); a domestic raffle prize follows Tax on raffle and event prizes (tax minimum KRW 50,000, 20% + 2%, optional separate taxation). For contest prize money see Tax on TV, quiz and contest prizes. All three presuppose a domestic payer who withholds. For overseas lotteries and prizes, the absence of that premise is the biggest difference.

Verification summary

• Verified: the wording of art. 21(1)(2) (no domestic-only limit); art. 14(3)(8)(a) (withheld income) and (d) (Lottery Act art. 2 lottery prizes only); the wording of art. 84, items 2 and 3; and the National Tax Service guidance that "other income not withheld is added to comprehensive income" and "Lottery Act lottery prizes end with withholding".
• Partly verified: taxation of residents on worldwide income (summary of the Service's manual), the foreign tax credit's limit, carry-forward and claim method (search summaries), and the 6% to 45% range of rates (full bands unverified).
• Not verified: any official interpretation on overseas lotteries, the foreign-currency conversion basis, recognition of ticket cost as expense, filing deadline and forms, penalties, treaty provisions on lotteries, foreign-exchange and overseas-account reporting, and individual foreign countries' withholding rules.

Limits

• This page covers residents only. Korean taxation of non-residents and foreigners is not covered.
• We did not compute the tax on an overseas prize in numbers, because the confirmed rate table is incomplete.
• Tax treaties, determination of residence and the details of double-tax relief are beyond its scope.
• Laws can change, and this page's reference date is 25 October 2026.

This page is general education, not tax or legal advice. Tax rules change; check the cited statute or a licensed tax professional before acting.

Sources and verification

• Income Tax Act art. 21(1)(2): "money or goods received by winning a lottery, prize coupon or other draw ticket" (no domestic-only wording) (in force 2026-01-01) — verified
• Income Tax Act art. 14(3)(8): separate taxation limited to withheld income (item a) and to lottery prizes under art. 2 of the Lottery and Lottery Fund Act (item d) (in force 2026-01-01) — verified
• Income Tax Act art. 84: item 2 refers to lottery prizes under art. 14(3)(8)(d) and art. 21(1)(14) prizes; item 3 to other income of KRW 50,000 or less (in force 2026-07-01) — verified
• National Tax Service: other income not withheld is added to the comprehensive income base; lottery prizes under the Lottery Act end with withholding — verified
• National Tax Service Q&A on the foreign tax credit: limit = comprehensive income tax × foreign-source share; claimed with the year-end or final return with proof of payment — partly verified · seen in a search summary; the page was not opened
• Income Tax Act art. 57 (foreign tax credit): carry-forward of unused credit for ten years, treaty reductions — partly verified · seen in a search summary
• National Tax Service year-end manual: residents are taxed on income from inside and outside Korea, non-residents only on Korean-source income — partly verified · seen in a search summary; art. 3 itself was not opened

Related reading

• Tax on Raffle and Event Prizes in Korea: The 22% Structure and Prizes in Kind Tax
• Tax on TV, Quiz and Contest Prizes in Korea: Other Income, Deemed Expenses and the Tax Minimum Tax
• South Korea lottery prize tax guide and calculator
• Korean edition of the lottery tax guide
• Prize tax by country