Do I have to close my ISA after three years?

No, you can extend it, but many people roll it into a pension account for the extra credit.

Can I buy US stocks directly in a Korean ISA?

No—you invest overseas through Korea-listed foreign ETFs.

Individual Savings Account (ISA, South Korea)

📈 Economics By CampusDown Wiki Editorial Team Last updated October 26, 2026

Korea's ISA is a tax-advantaged account that holds deposits, funds, ETFs, and domestic stocks in one place. After three years, part of the net gain is tax-free and the rest is taxed at a low flat rate.

Contents

1. Origins
2. Tax benefits and account types
3. Using the maturity and caveats
4. FAQ
5. References

Origins

The name and concept come from the UK's Individual Savings Account, created by Tony Blair's government in 1999 to encourage saving. South Korea introduced its own ISA in 2016, worried that household wealth was stuck in bank deposits and real estate amid low rates and an aging population. Strict eligibility and thin benefits left many accounts empty at first. In 2021 the government added a brokerage ISA for trading domestic stocks directly and loosened eligibility, and sign-ups soared.

Tax benefits and account types

Hold the account for the three-year minimum and up to ₩2 million of net gains (₩4 million for lower earners) is tax-free. The rest is taxed at 9.9% instead of the usual 15.4%. Because gains and losses are netted, a loss on an overseas ETF can offset dividend income. ISA income also stays out of Korea's comprehensive financial-income tax. Brokerage ISAs that hold index ETFs are the most popular. Trust ISAs are deposit-focused, and discretionary ISAs are professionally managed.

Using the maturity and caveats

Move maturing funds into a pension savings account or IRP within 60 days and you get an extra tax credit on 10% of the amount, up to ₩3 million. That's why a popular strategy is to roll the ISA into a pension every three years. You can't open an ISA if you were subject to the comprehensive financial-income tax in any of the previous three years. Closing early claws back the tax breaks, though you can withdraw up to the amount you contributed.

FAQ

Do I have to close my ISA after three years?: No, you can extend it, but many people roll it into a pension account for the extra credit.
Can I buy US stocks directly in a Korean ISA?: No—you invest overseas through Korea-listed foreign ETFs.

Sources reviewed: 2026-10-26

References

조세특례제한법 제91조의18(개인종합자산관리계좌에 대한 과세특례).
금융위원회. (2021). 「중개형 ISA 도입」 보도자료.
HM Revenue & Customs. (2024). Individual Savings Accounts (ISA) statistics.

Reports and materials that use this theory (Korean)

There are no materials dedicated to this theory yet, but you can search related reports in the CampusDown library (Korean).

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This article was last updated on October 26, 2026. It is based on widely recognized original works and textbooks; when citing it in a paper, please check the original sources listed in the references.