Korea's ISA Account Types: Brokerage vs Trust vs Discretionary

Of Korea's three ISA (Individual Savings Account) types, only the brokerage type lets you buy and sell Korean listed stocks yourself. The trust type has the institution hold instruments you designate; the discretionary type hands portfolio construction to the provider entirely. The tax treatment is identical across all three — per Toss Feed's summary, a KRW 20 million annual contribution cap, a three-year minimum holding period, a tax-free allowance of KRW 2 million (KRW 4 million for the low-income tier), and 9.9% separate taxation on gains above that. Choosing a type is not a tax decision. It is a decision about who runs the account, and what that costs.

밤 거실 소파에 앉아 스마트폰을 보는 30대 남성

One thing separates the three: who picks the holdings

With the brokerage type you place orders yourself. Korean listed stocks, ETFs, funds and REITs are all available, and there is no account-level fee — only the brokerage commission on each trade.

The trust type is legally a trust contract. You designate what goes in, but purchases run through the trust, and an annual trust fee is deducted in proportion to the balance. Direct purchases of Korean listed stocks are not permitted; deposits, funds and ELS products dominate. The discretionary type outsources selection too: you pick a risk profile from a set of model portfolios and the provider rebalances within it. Its fee is the highest of the three.

Item	Brokerage	Trust	Discretionary
Who picks holdings	Account holder	Account holder (designates)	Provider
Direct Korean stock trading	Yes	No	No
Main channel	Securities firms	Banks and securities firms	Securities firms
Account fee (annual, assumed)	None (commissions only)	Around 0.10%	0.3–0.8%
Tax-free allowance	KRW 2m general / KRW 4m low-income tier — same for all three

Fee rates vary by provider and product. The 0.10% and 0.50% used below are representative mid-points of the ranges commonly quoted; the number in your own contract is the one that matters.

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Over five years, how much do the fees actually cost?

The tax break has a ceiling. Even if the full KRW 2 million allowance is used, the tax saved versus a regular account is KRW 2,000,000 × 15.4% = KRW 308,000. Gains above the allowance are taxed at 9.9% instead of 15.4%, a further 5.5 percentage points. In other words, what an ISA gives back is capped — and account fees eat into that cap.

Apply those fee rates to the average balance per account holder and the scale becomes visible. Using the 30 April 2026 figures reported by Seoul Economic Daily: KRW 47.93 trillion held by 7,952,752 brokerage holders, KRW 16.07 trillion by 919,202 trust holders, KRW 1.59 trillion by 147,677 discretionary holders. The division gives this.

Type	Average balance per holder (KRW 10k)	Assumed fee (annual, %)	Five-year fees (KRW 10k)	Share of the KRW 308k cap (%)
Brokerage	603	0	0.0	0
Trust	1,748	0.10	8.7	28
Discretionary	1,077	0.50	26.9	87

The brokerage type dominates on account count, yet the average trust balance is 2.9 times larger. That points to lump sums parked in deposit-like products. And the larger the balance, the larger the absolute cost of a percentage-based fee.

Run it backwards and a threshold appears. The balance at which five years of fees equals the KRW 308,000 cap is KRW 61.6 million at 0.10%, and KRW 12.32 million at 0.50%. The average discretionary balance of KRW 10.77 million already sits at 88% of that line. Anything beyond it has to be earned by performance, not by the tax break.

The tax benefit of an ISA has a ceiling. A percentage-based fee does not.

The money has already moved to the brokerage type

According to Seoul Economic Daily, total ISA balances stood at KRW 65.59 trillion across 9,019,631 holders at the end of April 2026. The brokerage type accounted for 73% of assets, trust 24%, and discretionary just 2.4%. Brokerage holders grew by more than 1.36 million in four months, from 6,592,376 at the end of 2025.

The asset mix inside those brokerage accounts tells the same story. ETFs make up 47.8% and individual stocks 35.9% — over 80% in risk assets — against 8.4% in deposits. The tax shelter is being used as a stock account, not a savings refuge.

Supply has followed. Securities firms are closing the trust type to new customers: of the ten largest brokerages, only Samsung Securities, NH Investment & Securities and Korea Investment & Securities still accept new trust ISA applications, and Mirae Asset Securities stopped on 1 April 2026. Before comparing types, check whether the one you want is still open where you bank.

해질 무렵 서울 여의도 금융가 빌딩 외경

What changes in 2027: a five-year cap and a new account

The 2026 tax revision bill targets the time axis. Per Herald Business, a general ISA contract would be limited to a minimum of three and a maximum of five years, and the carry-forward of unused annual contribution room would be abolished. Rolling a maturity forward indefinitely would no longer be possible — which is why the calculation above uses a five-year horizon.

Alongside it comes the Productive Finance ISA. It restricts investments to domestic assets — Korean listed stocks, domestic equity funds, the National Growth Fund, and business development companies (BDCs) — and in exchange exempts interest and dividend income from tax entirely. The contribution cap is KRW 20 million a year and KRW 200 million in total, with a three-year minimum and up to ten years of operation. People subject to comprehensive taxation on financial income cannot open one. It applies to new accounts from 1 January 2027.

Against the existing general ISA's KRW 100 million lifetime cap, the new account's KRW 200 million is double. But the investment universe is domestic only, so a portfolio weighted toward overseas assets will not fit inside it. The tax arithmetic of that fork is covered separately in the piece calculating dividend taxation under the Productive Finance ISA versus the general ISA.

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What to watch

The fee rate in your contract — trust and discretionary fees differ by product. Redo the division with your own number, not the 0.10% and 0.50% used here.
Where your balance sits relative to the threshold — KRW 12.32 million at a 0.50% fee, KRW 61.6 million at 0.10%, is where five years of fees matches the tax-free cap.
Whether you actually fill the KRW 2 million allowance — if gains fall well short of it, the ceiling shrinks and the relative weight of fees grows.
Passage of the 2026 tax revision bill — the five-year contract limit and the end of carry-forward are still proposals. Confirm the final text and effective date.
Whether the channel is still open — trust ISAs are being closed to new applicants at securities firms, so availability comes before comparison.
Eligibility for the low-income tier — it doubles the tax-free allowance from KRW 2 million to KRW 4 million, which moves the starting point of every calculation above.