The ‘Yellow Umbrella Deduction’ is a deduction system for employers’ severance pay that is operated so that small businesses and small business owners can secure their livelihood from threats to their livelihood, such as closure of business or old age, and receive opportunities for business recovery.
You can view the Yellow Umbrella Deduction Loan here. Regardless of your credit rating, you can get a loan within the amount you have paid.
There are three types of loan products: general loan, medical loan, and disaster loan.
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Yellow Mutual Umbrella Subscription Conditions and Interest Rates
general loan
Loan Qualifications: If you are a regular installment payer, you can join.
Loan limit: (voluntary cancellation refund amount – estimated withholding amount)* 90% or less is applicable. The loan may not exceed the installment paid by the contractor. Loans are available in units of Rs.
Repayment method: within the loan limit, up to 30 million won per person, and one-time repayment within one year
Interest rate: Base rate + within 3% per annum and quarterly variable rate
Required Documents: Application
Application method: Internet, mobile, counter, call center
medical loan
Loan Qualifications: Those who have been hospitalized for more than 3 days due to illness or injury as a regular payer of installments
Loan limit: (voluntary cancellation refund amount – estimated withholding amount)* 90% or less is applicable. The loan may not exceed the installment paid by the contractor. Loans are available in units of Rs.
Loan amount: within 10 million won
Repayment method: Temporary repayment within 1 year (regular and mid-term repayment possible)
Interest rate: no interest
Required documents: application form, medical certificate, confirmation of admission and discharge
How to apply: In person or by mail
Application period: within 3 months from the date of admission and discharge
disaster loan
Loan Qualification: A person who has suffered damage due to a disaster as a regular payer of installments
Loan limit: (voluntary cancellation refund amount – estimated withholding amount)* 90% or less is applicable. The loan may not exceed the installment paid by the contractor. Loans are available in units of Rs.
Loan amount: less than 20 million won or the amount of damage on the disaster confirmation document
Repayment method: Temporary repayment within 1 year (regular and mid-term repayment possible)
Interest rate: no interest
Required documents: application form, confirmation of disaster SMEs
How to apply: visit or mail
Application period: within 3 months from the date of issuance of the confirmation
Small business owners can get a loan without interest or at a low interest rate in case of an emergency.
But basically, this is only possible when you join the Yellow Umbrella Deduction and pay the installment. Please check the yellow umbrella deduction, which has many advantages rather than disadvantages.
Advantages of yellow umbrella deduction
Income deduction
The Yellow Umbrella Deduction is a beneficial system for small business owners in terms of not only loans but also income deductions. It can be a tax-saving strategy for businesses with a high tax burden as income deduction benefits of up to KRW 5 million per year are granted for paid installments.
Individuals and corporate representatives whose business income is less than 40 million won have a maximum income deduction of 3 million won and can enjoy tax savings from 330,000 won to 800,000 won.
Category Business Income Amount of Income Income Deduction Estimated Tax Rate Tax Saving Effect
Individual/corporate representative Less than 40 million won 5 million won 6.6%~16.5% 330,000~825,000
Individual More than 40 million won and less than 100 million won 3 million won 16.5%~38.5% 495,000~1,155,000
Corporate representative More than 40 million won and less than 56.75 million won 3 million won 16.5%~38.5% 495,000~1,155,000
Individuals exceeding KRW 100 million KRW 2 million 38.5%~49.5% 770,000~990,000
Prohibition of seizure of deductibles
The law prohibits seizure, transfer, and provision of collateral for mutual aid funds, so even if the business is closed, it is possible to secure a minimum amount of money for stability in life and business recovery.
As the seizure of the account itself is legally prohibited, you can safely receive the payment to the Happy Keeper, a seizure prevention account.
You can open a bank account at any time during the yellow umbrella contract period at the window of a commercial bank.
compound interest
This is a small business system introduced for business recovery and livelihood stabilization of small businesses and small businesses such as business closure, death, and old age.
Interest is accrued on an annual compounding basis, making it even more advantageous for long-term subscribers.
Hope subsidy
Local governments that have signed an agreement with the Korea Federation of Small and Medium Enterprises are providing support for hope incentives to yellow umbrella subscribers.
The subsidy support project may be changed according to the policies and budgets of local governments. Depending on the sales, you can receive a minimum of 20,000 won and a maximum of 360,000 won.
Various welfare plus services
Management advisory, accounting program support, yellow umbrella affiliate card benefits
Capacity building/recovery, retirement planning, online marketing education provided
Discounts on affiliated services such as health checkups, funerals, ophthalmology, oriental clinics
Recreation facilities, travel agencies, rental cars, sports, cultural performance benefits
Welfare mall, discount support for planned products
Prepare for sudden risk through accident insurance, PL insurance, and damage deduction