South Korea Plans to Promote Basic Pension System Reform, Including Overseas Assets and Virtual Assets in Income Recognition

According to "Edaily" on April 15, the South Korean government is advancing significant reforms to the Basic Pension (기초연금) system, aiming to include overseas financial assets and virtual assets (cryptocurrencies) in the calculation of income recognition. The reform aims to prevent high-asset individuals from exploiting system loopholes to obtain pensions while also enhancing fairness.

It is reported that the current basic pension review in South Korea only examines domestic assets and cannot accurately grasp applicants' holdings of overseas financial assets and virtual assets. The core of this reform is to address this long-standing institutional shortcoming.

To this end, the South Korean government plans to amend the Basic Pension Act by strengthening the obligation to declare overseas income and assets and enhancing tax information linkage to achieve comprehensive verification of personal assets. The bill was proposed in 2025 and is currently under discussion in the National Assembly.

In addition to expanding the scope of asset verification, the government will also optimize the property deduction system. Considering the rising cost of living, the government will adjust the property valuation standards to make deductions more aligned with reality, ensuring that the basic pension truly benefits the elderly in need.

At the same time, the government also plans to introduce a residence duration requirement domestically, referencing practices from OECD countries such as Australia, Canada, Norway, and Sweden, to restrict pension eligibility for those who have lived overseas for a long time and then return.

Specifically, the current system allows seniors over 65 with income in the bottom 70% to apply for the pension, with no domestic residence time requirement. The new system proposes to add a condition that applicants must have resided in Korea for a certain number of years after turning 19.

It is worth noting that since its introduction in 2014, South Korea's basic pension has played an important role in alleviating elderly poverty, with the payout amount increasing from 200k won per month to about 350k won this year.

However, with the rapid aging population leading to increased fiscal burdens, ensuring the sustainability of the system has also become a key issue. Experts emphasize that while strengthening residence requirements, supplementary measures should also be devised to prevent vulnerable groups from falling through the cracks.

#韩国 #Old-age Security