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Biz News Korea(Eng)
ISA account to hit market in South Korea on Monday
- Collected
- 2016.03.14
- Distributed
- 2016.03.15
- Source
- Go Direct
An individual who puts money in an ISA won’t need to pay tax on up to 2.5 million won ($2,102) investment profit earned over five years and will pay a 9.9 percent tax on additional profits. Market watchers believe ISAs are expected to attract around 12 trillion won this year and 50 trillion won in five years.
According to the Financial Services Commission Sunday, 13 banks, 19 brokerages and one insurer have registered to provide ISA products.
The ISA account allows a holder to manage cash savings, deposits, stocks, bonds and equity-linked-securities investment in a single account, offering tax benefits for the investment returns. Investors can choose the ISA with their own portfolio they create or the one that is already prepared by the financiers.
So far, 13 brokerages unveiled their ISA portfolios that mostly promise a mid-risk and mid-range returns of 4 percent to 7 percent. Those who earn 18 million won investment profit from an annual 20 million won investment every year (with an annual 6 percent return) for five years were levied 2.8 million won taxes so far. But with the new account, their tax burden reduces to 1.6 million won.
By Choi Jae-won, Chung Ji-sung
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]