Published · 2026-10-25 · Last reviewed · 2026-10-25 · 8 min read

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Tax on raffle and event prizes in Korea

When you win a raffle or an online promotion, the notice often says: "taxes and public charges are borne by the winner." It is often left unclear how much that is, who pays whom, and how tax is worked out if the prize is goods. This page answers those questions from the Income Tax Act and National Tax Service guidance. As in the earlier lottery prize tax guide, it separates what was verified from what was not.

Not tax advice. This is general education. Individual circumstances (total income, how the prize is paid, the promotion's terms) can change the outcome, so check the National Tax Service guidance, the statute text or a tax professional before filing or deciding. Laws change. The verification basis is the Income Tax Act in force from 1 January 2026 (Act no. 21221).

1. What kind of income: 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. A raffle prize falls here. By contrast, item 1 of the same paragraph, "prize money, rewards, bounties or the equivalent", covers payments for contests, competitions or performance, with different rules on expenses (see Tax on TV, quiz and contest prizes). Whether a promotion is item 2 or item 1 depends on whether winners are chosen by draw or by judging or ranking; that turns on the real mechanism of the promotion, so this page does not rule on it in general.

Lottery prizes under article 2 of the Lottery and Lottery Fund Act are also item 2 other income but are subject to separate rules. The heart of this page is how a raffle prize differs from them.

2. Where the 22% comes from

• Income tax 20%: the withholding rate on general other income is 20%, as the National Tax Service also explains. Only lottery prizes, horse-race refunds and similar items have 30% on income above KRW 300 million. A raffle prize has no 30% band.
• Local income tax 2%: when income tax is withheld, 10% of that tax is collected as individual local income tax (Local Tax Act art. 103-13, confirmed against the statute in the step-2 evidence table). 10% of 20% is 2%.
• Total 22%: 20% + 2% = 22%, the "taxes and public charges 22%" people mention. "Public charges" in promotion notices is not a legal term but a habit of bundling these two taxes.

The 22% applies to the whole value of the prize. A raffle prize has no deemed expense. Article 87 of the Enforcement Decree deems expenses at fixed shares only for some prize money and awards (80%) and for items such as writing fees (60%); a raffle prize (art. 21(1)(2)) is not in that list. Income therefore equals the amount received.

3. The tax minimum: KRW 50,000

Article 84 of the Income Tax Act says no income tax is levied on other income at or below set amounts. Item 3 covers "other income of KRW 50,000 or less per item", and National Tax Service guidance gives the same threshold. Lottery prizes are KRW 2 million or less per item under item 2 of the same article, but a raffle prize is neither a lottery under the Lottery Act nor a slot-machine prize, so item 3's KRW 50,000 appears to apply. That is a reading of the wording of the statute and not a confirmed official interpretation (partly verified).

At the KRW 50,000 line the same cliff occurs as at the KRW 2 million line for lotteries. A prize of KRW 50,000 carries no tax, but at KRW 50,001 the whole income bears 20%: KRW 10,000 income tax and KRW 1,000 local income tax come off, leaving KRW 39,001. Just above the line, KRW 1 more of prize means KRW 10,999 less in hand.

4. Who pays

The people involved divide into two.

• The one who deducts and remits (the withholding agent): a person who pays other income in Korea must withhold income tax (Income Tax Act art. 127, confirmed in the step-2 evidence). The business or organiser giving the prize is such a person. The withheld tax is paid by the 10th of the month after the month of collection (art. 128; local income tax under Local Tax Act art. 103-13).
• The one who bears the tax (the recipient): the winner is the taxpayer who receives the income. Withholding means deducting the winner's tax when paying and remitting it to the state.

The line "taxes and charges are borne by the winner" describes this structure. Legally the 22% is the winner's tax, and the organiser remits it on the winner's behalf. How payment actually works depends on the kind of prize.

• Cash or cash-like prizes: 22% is deducted at payment and the rest is paid. For a KRW 1 million prize, KRW 220,000 is deducted and KRW 780,000 received.
• Prizes in kind: goods cannot be cut up, so organisers often ask the winner for the tax in cash or handle it under the promotion's terms. How the law prescribes this, and whether tax the organiser pays on the winner's behalf counts as the winner's income too, we could not confirm. The promotion's terms and a tax professional should be consulted.

5. How a prize in kind is valued

For income received other than in money, article 24(2) of the Income Tax Act sets the amount by value "at the time of the transaction", as we saw in a search summary. The statute page did not display its text, and the precise valuation method (what counts as market value) is delegated to the Enforcement Decree and was not checked, so this is partly verified. In practice organisers usually quote the normal selling price or market price as the prize value, but whether that matches the legal valuation method was not confirmed.

Take an assumption. If a home appliance valued at KRW 1 million is the prize, income tax is KRW 200,000 and local income tax KRW 20,000, KRW 220,000 in all. It is not "free": instead of cash you owe KRW 220,000 in tax. A small prize valued at KRW 50,000 or less is not taxed. Whether gift vouchers, points or mileage are valued the same as cash was not confirmed here.

6. Separate and comprehensive taxation: unlike lotteries

Under article 14(3)(8)(d) of the Income Tax Act, lottery prizes are unconditionally separately taxed and withholding ends the tax obligation. A raffle prize falls under item (a), not (d). Item (a) treats other income of items 1 to 8 and others, of KRW 3 million or less and withheld, as separately taxed other income, but excludes it if the recipient wants to add it to comprehensive income.

• If the income amount is KRW 3 million or less and was withheld, withholding at 22% ends it unless you choose to add it.
• If the income amount is over KRW 3 million, it is not eligible for separate taxation and must be added to comprehensive income and reported in the comprehensive income tax filing period (the deadline was not checked here). The 22% is then tax paid in advance, and the final settlement uses progressive rates together with your other income. The rate table (Income Tax Act art. 55) has several bands, so we do not print figures here.

The National Tax Service likewise says other income that was not withheld is added to comprehensive income, and separately states that lottery prizes under article 2 of the Lottery Act end with withholding. So for the same "win", a lottery ends at 22% or 33%, whereas a raffle prize above KRW 3 million may produce more tax depending on your other income. The exact filing procedure and deadlines for adding it are not covered; please check National Tax Service guidance.

7. Calculator

Choose the type of income and enter the amount to see the net amount after withholding. Deemed-expense options are used in the prize-money article that follows, so raffle prizes (no expense) are the default here.

We could not confirm a rule for amounts below one won, so each step is truncated to the won. The actual payout may differ by small amounts depending on the payer's rounding (the same assumption as in the lottery calculator).

8. Lottery prize versus raffle prize at a glance

Verification summary

• Verified: the wording of art. 21(1)(2), the KRW 50,000 of art. 84, item 3, the National Tax Service's 20% rate, the wording of art. 14(3)(8)(a) and (d), and the structure of the 80% and 60% items in Enforcement Decree art. 87.
• Partly verified: that art. 84, item 3 (KRW 50,000) applies to raffle prizes (a reading of the wording), the valuation of goods under art. 24(2) (search summary), and the 2% local tax and withholding timing (step-2 evidence table).
• Not verified: how tax is paid on prizes in kind, how tax paid by the organiser on the winner's behalf is treated, the valuation of vouchers and points, whether "per item" means one win or an aggregate, treatment of amounts below one won, and the detailed procedure for adding the income to comprehensive income.

Limits

• The business side of giving prizes to consumers (expense treatment, value-added tax) is not covered.
• Prizes received abroad and overseas lotteries are covered in Domestic tax on overseas lottery and prize wins.
• Laws can change, and this page's reference date is 25 October 2026.
• For rules in other countries, start from Prize tax by country.

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) items 1, 2 and 14 (in force 2026-01-01, Act no. 21221) — verified
• Income Tax Act art. 84 (tax minimum): item 2 lottery prizes under KRW 2 million; item 3 other income of KRW 50,000 or less per item (in force 2026-07-01, Act no. 21221) — verified
• Income Tax Act art. 14(3)(8): separate-taxation other income (item a: income of KRW 3 million or less that was withheld; item d: lottery prizes under the Lottery Act) (in force 2026-01-01) — verified
• National Tax Service, other income: 20% general withholding rate, 30% on lottery prizes over KRW 300 million, KRW 50,000 per-item minimum — verified
• National Tax Service, comprehensive versus separate taxation of other income (lottery prizes: withholding ends the tax obligation; the KRW 3 million test) — verified
• Income Tax Act Enforcement Decree art. 87 (deemed expenses: 80% and 60% items; raffle prizes are not on the list) (in force 2026-10-01) — verified · read as a summary because quotation of the full text was limited
• Income Tax Act art. 24(2) (income received other than in money is valued at its value at the time of the transaction), seen in a search summary only — partly verified · the statute page did not display text; the content was seen in a search summary only, and the enforcement decree rules on valuation were not checked

Related reading

• Tax on TV, Quiz and Contest Prizes in Korea: Other Income, Deemed Expenses and the Tax Minimum Tax
• Overseas Lottery or Prize Wins and Korean Tax: What a Korean Resident Must Report Tax
• South Korea lottery prize tax guide and calculator
• Korean edition of the lottery tax guide
• Prize tax by country