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The core of the amendment is that the income threshold for pension reduction has been significantly raised.
Previously, any income above the A-value (309,000 KRW per month in 2025) triggered a reduction.

Under the new rules, pension reduction begins only when income exceeds
A-value + 2,000,000 KRW — meaning that income up to approximately 5.09 million KRW results in no reduction at all.

The first and second income brackets that previously resulted in reductions are now abolished, removing pension reduction for about 65% of all affected pensioners.

The government clarified that pension reduction is determined not by gross salary but by tax-adjusted income (after deductions). However, to make the rule easier to understand, the press materials estimate the practical impact based on monthly salary.

This aligns with the new threshold requiring income to exceed A-value + 2 million KRW before reduction begins. As a result, fewer than 1% of pensioners are expected to experience any reduction.

1) Eligibility for Reduction

• The individual must be an old-age pension recipient.
• The rule applies during the first five years after the pension start date.
• The recipient must be engaged in income-generating work (employment or business).
• Applicable ages:
  - General recipients: ages 60–64
  - Special occupations: ages 55–59
• Not applicable to disability pension or survivors’ pension recipients.

2) Types of Income Counted

• Employment income (after employment income deduction)
• Business income (after deductible expenses)
• Tax-exempt income is excluded.
• Interest and dividend income are NOT included in the reduction calculation.

The amendment was passed by the National Assembly on 27 November 2025 and, according to the official press release, will take effect six months after the law is promulgated.

From this point onward, working seniors will benefit from the new rule whereby pension reduction is not applied unless income exceeds A-value + 2 million KRW.

• The income threshold for pension reduction has been raised from “above the A-value” to “A-value + 2 million KRW.”
• Workers earning up to approximately 6.2 million KRW per month are generally unaffected.
• The first two reduction brackets have been abolished, removing reduction for about 65% of previous cases.
• Only employment and business income are counted; financial income is excluded.
• The revised rules are expected to apply from July 2026.

This reform is more than a technical adjustment— it is a meaningful step toward ensuring that seniors who wish to keep working can do so without facing unnecessary pension penalties.

All information in this article is strictly based on the official press release by the Ministry of Health and Welfare (Nov. 27, 2025). With the new rules expected to take effect in July 2026, this is a good time to review your income and pension status.

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