3 in 4 self-employed make less than 1 million won a month

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Three-quarters of self-employed people and small business owners in South Korea report a monthly income of less than 1 million won ($750), well below the monthly minimum wage, government data showed Sunday.

Out of 11.46 million self-employed people who filed for income tax in 2022, 75.1 percent, or 8.6 million reported a monthly income below 1 million won, or an annual income of less than 12 million won, according to data obtained from the National Tax Service by Rep. Park Sung-hoon of the ruling People Power Party. Of these, 944,250 reported zero income, representing 8.2 percent of all filings.

The number of low-income, self-employed individuals is rapidly on the rise. The number of owners who filed an annual income below 12 million won increased from 6.1 million in 2019 to 6.6 million in 2020 and 7.9 million in 2021.

Similarly, the number of filers who reported zero income increased from 649,000 in 2019 to 780,363 in 2020 and 831,000 in 2021.

While this figure does not factor in the discrepancies between taxable income and actual earnings, it suggests that a considerable portion of the self-employed workers are experiencing severe financial hardship.

“The reality that 75 percent of self-employed workers earn less than 1 million won a month shows how difficult it is for small businesses and self-employed individuals,” said Rep. Park, stressing the need for comprehensive measures to improve the situation for the self-employed.

By Ahn Sung-mi(sahn@heraldcorp.com)