Severance Pay Calculator
Estimate severance pay from your start/end dates and last 3 months of wages, based on average wage.
Eligible with 1+ year of service. Results vary by whether bonuses/allowances are included.
How statutory severance is calculated
Korean statutory severance (toejikgeum) is built on your daily average wage, not on your headline monthly salary. The formula is: daily average wage x 30 days x (total days worked / 365). The daily average wage is the total wages you received during the three calendar months before your last working day, divided by the number of calendar days in that window (usually about 91). Multiplying by 30 gives roughly one month of average pay for each full year of service, and the (days worked / 365) factor prorates the amount down to the day. This tool derives days worked from your start and end dates, and the average wage from the three-month total you enter, then applies the same formula.
A worked example
Suppose your three-month total wages were 9,100,000 won over a 91-day window. Your daily average wage is 9,100,000 / 91 = 100,000 won, so one full year of service is worth 100,000 x 30 = 3,000,000 won. If your total days worked come to 500 days, severance = 3,000,000 x (500 / 365) = about 4,109,589 won. Now imagine you delay leaving by 60 days, reaching 560 days: severance = 3,000,000 x (560 / 365) = about 4,602,740 won. Those two extra months add roughly 493,151 won. The example shows why timing matters: because the amount is prorated to the day, even a short extension near a year boundary can move the figure noticeably. The wage figures here are illustrative inputs, not official amounts; replace them with your own.
Why average wage is the part that shifts the result
- The base is average wage over the last 3 months, so anything paid in that specific window pushes the number up or down.
- Regular fixed allowances and the prorated share of a regular bonus are typically counted, which raises the average above plain base salary.
- Unused annual-leave allowance paid on departure can also enter the calculation, another reason results differ from a rough monthly-salary guess.
- If your final three months included unpaid leave or an unusually low-pay month, the plain average can be dragged down, so the law provides safeguards you should confirm with HR.
- Because your entered 3-month total decides everything, the biggest source of disagreement with an employer is what was included in that total.
When and how to use it
- Before resigning: get an order-of-magnitude estimate of your payout so you can plan the transition and any gap in income.
- Timing your exit: compare tenure scenarios (for example, leaving now versus staying a few more weeks) to see how day-level proration changes the amount.
- Cross-checking a payment: after your employer pays, re-run the numbers as a sanity check and ask about any large gap between the estimate and what you received.
- Negotiation prep: understand which wage components move the figure before you discuss your final settlement, so you know what to ask about.
Common mistakes and misconceptions
- Thinking severance equals one month of salary per year exactly. It is one month of average wage, which usually differs from base salary once allowances and bonuses are counted.
- Assuming partial years round up or down. They do not; the days worked / 365 factor prorates to the day, so 500 days is worth more than one year but less than two.
- Forgetting the eligibility floor. Under one year of continuous service, statutory severance generally does not accrue at all.
- Treating this gross estimate as take-home. Severance is taxed as retirement income and is paid after withholding, so the amount that lands in your account is lower.
- Ignoring the retirement pension scheme. If your employer funds severance through a DB or DC plan, the actual payout mechanism and amount can differ from a plain statutory estimate.
Cautions and how to confirm the exact amount
This calculator is a reference estimate, not an official determination. The result depends entirely on the dates and three-month wage total you enter, and it cannot know how your employer classifies each allowance, how bonuses are prorated, or whether any period is excluded from the average-wage calculation. It also shows a gross figure before retirement-income tax withholding, so your net payment will be lower. Treat this as a planning number, and confirm the exact amount with your HR or payroll team and the Ministry of Employment and Labor severance calculator; for the tax portion, check with your employer or the National Tax Service. The year basis and statutory constants here follow the standard 2026 severance formula, but individual cases can vary.
The dates and wages you enter are calculated only in your browser and are never sent to or stored on a server.
Read the Privacy Policy →Frequently asked questions
When am I eligible for severance?
Workers with one year (365 days) or more of continuous service who work at least 15 hours per week on a 4-week average are generally eligible for statutory severance. Under one year of service, statutory severance does not accrue. A handful of exceptions exist (for example, very short weekly hours), so confirm your specific situation with HR or the labor ministry.
What goes into average wage?
Average wage is the total wages actually paid during the three months before your last working day, divided by the calendar days in that period. It typically includes base pay, fixed allowances, the prorated share of a regular bonus, and any unused annual-leave allowance paid on departure. Because this tool uses the three-month total you enter, your result will shift depending on exactly which of these you include.
What if my last three months were unusually low?
Since the base is your final three months, a low-pay stretch such as unpaid leave can pull the plain average down. Korean labor rules include safeguards to prevent the average wage from being unfairly reduced in some situations, and average wage is also compared against a floor so the lower measure does not automatically win. The rules are technical, so confirm how your specific period is handled with HR or the labor ministry.
Is severance the same as a retirement pension (DB/DC)?
Not exactly. Many employers now fund severance through a retirement pension scheme rather than paying a lump sum directly. Under a defined-benefit (DB) plan the payout is designed to track the statutory amount, while under a defined-contribution (DC) plan your employer makes periodic contributions to your account and the final balance also depends on investment returns. In a DC case especially, the actual payout can differ from this statutory estimate, so check your plan documents.
How is severance taxed?
Severance is taxed as retirement income, which is assessed separately from your regular salary and generally benefits from deductions tied to your years of service that lower the effective rate. Your employer usually withholds this tax before paying you, so your net amount is below the gross figure this tool shows. For the exact withholding, check with your payroll team or the National Tax Service; this calculator does not compute tax.
Is my information stored?
No. All calculation happens only in your browser, and the dates and wages you enter are never sent to or stored on a server. You can safely close the page and the inputs are gone.