Business · Markets · 22 hrs ago
IRP accounts can buy individual government bonds from September
South Korea’s individual retirement pension, or IRP, is designed for saving and investing for retirement.
From September, people can buy individual-investment government bonds through DC and IRP accounts.
IRP contributions may qualify for tax credits, and taxes on investment gains can be deferred while the money stays invested.
People who meet the rules and take the money as a pension may also benefit from lower pension-income tax.
These advantages can reduce the tax burden compared with an ordinary account, but taking money out early or withdrawing it all at once can lead to unexpected taxes.
An IRP is therefore intended for people who can leave the money invested until retirement and draw it over time.
From September, DC and IRP accounts can buy individual-investor government bonds.
IRP holders can receive a tax credit on eligible contributions.
Investment gains in an IRP can be taxed later rather than during the investment period.
Eligible pension withdrawals receive tax benefits, while early account closure or lump-sum withdrawals may lead to unexpected taxes.
The article says tax benefits can reduce the tax burden by more than half compared with a regular account.
- Who
- Holders of DC and IRP retirement accounts.
- What
- They can buy individual-investor government bonds through those accounts.
- When
- From September.
- Where
- In DC and IRP accounts.
- Why
- The accounts offer tax credits, tax deferral on investment gains and tax benefits for eligible pension withdrawals.
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- Availability
- From September
- Eligible accounts
- DC and IRP
- Tax treatment
- Investment gains can be taxed later
- Withdrawal conditions
- Pension withdrawals can receive tax benefits; early closure or lump-sum withdrawals may lead to unexpected taxes
Sources
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