36 |
FAQ ON FDI IN KOREA 2023 (Q106~Q113)
■ FAQ on FDI in Korea 2023 (Q106~Q113)
Taxation and Accounting
Q106
I understand that a foreign-invested company that applied for tax reduction or exemption on or after January 1, 2020 and was granted the tax relief can receive reduction or exemption of local taxes and customs duties (e.g., VAT, individual consumption tax), but not reduction or exemption of corporation tax. However, according to the Restriction of Special Taxation Act, the reduction or exemption of local t . . .
작성일 2023-12-26
2023
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35 |
FAQ ON FDI IN KOREA 2023 (Q101~Q105)
■ FAQ on FDI in Korea 2023 (Q101~Q105)
Taxation and Accounting
Q101
hould a foreign-invested company that moves into an individual-type Foreign Investment Zone (FIZ) designated and publicly announced by the provincial governor make a separate application for tax reduction and exemption?
A101
Even if an FIZ is designated and publicly announced as an individual-type FIZ, companies . . .
작성일 2023-12-18
2023
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34 |
FAQ on FDI in Korea 2023 (Q96~Q100)
■ FAQ on FDI in Korea 2023 (Q96~Q100)
Taxation and Accounting
Q96
What is the thin capitalization rule?
A96
Under the thin capitalization rule, the interest expense on loans from foreign controlling stockholders exceeding a certain amount is not recognized as deductible expense.
To save tax, companies tend to increase loans and pay . . .
작성일 2023-12-12
2023
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33 |
FAQ on FDI in Korea 2023 (Q91~Q95)
■ FAQ on FDI in Korea 2023 (Q91~Q95)
Taxation and Accounting
Q91
How is a foreign company or non-resident taxed for capital gains on securities sourced domestically?
A91
In principle, the lesser of the following shall be reported and paid: ① Sale price of shares × 10%② Profit from sale of shares (Income – Acquisition price andsales expense) × 20%However, if there is a tax treaty bet . . .
작성일 2023-12-05
2023
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32 |
FAQ on FDI in Korea 2023 (Q86~Q90)
■ FAQ on FDI in Korea 2023 (Q86~Q90)
Taxation and Accounting
Q86
What methods of calculating the arm's length price (ALP) do the Korean tax authority recognize?
A86
The Korean tax law (the Adjustment of International Taxes Act)requires companies to select and apply the most reasonablemethod among the following
Comparable uncontroll . . .
작성일 2023-11-28
2023
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31 |
FAQ ON FDI IN KOREA 2023 (Q82~Q85)
■ FAQ on FDI in Korea 2023 (Q82~Q85)
Taxation and Accounting
Q82
What are the types and rates of taxes levied on foreign-invested companies (corporations)?
A82
Foreign-invested companies bear the same tax burden asdomestic companies. In general, corporations are subject tocorporate tax, corporate local income tax, value-added tax(VAT), and additional taxes that may be imposed on spe . . .
작성일 2023-11-21
2023
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30 |
FAQ ON FDI IN KOREA 2023 (Q76~Q81)
■ FAQ on FDI in Korea 2023 (Q76~Q81)
RealE state Acquisition
Q76
Is it necessary for a domestic branch of a foreign corporation to report real estate acquisition by foreigners?Also, how can the acquisition cost be introduced?
A76
A domestic branch of a foreign corporation should report real estate acquisition by foreigners.
Under t . . .
작성일 2023-11-07
2023
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29 |
FAQ ON FDI IN KOREA 2023 (Q73~Q75)
■ FAQ on FDI in Korea 2023 (Q73~Q75)
Real Estate Acquisition
Q73What is the procedure for a foreign investor’s acquisition of real estate in Korea?
A73 When a foreigner acquires real estate, applicable laws andprocedures vary depending on the purpose of acquisition, residency status, and whether the buyer is a corporate or an individual.
The Act on Report on Real Estate Transactions, etc. stipulates only theprocedures for a foreigner to acquire real estate in Korea. When the realestate acquisition is for . . .
작성일 2023-10-31
2023
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28 |
FAQ on FDI in Korea 2023 (Q66~Q72)
■ FAQ on FDI in Korea 2023 (Q66~Q72)
Establishment of Corporation
Q66 Should a foreign-invested company attach its office lease contract when applying for registration of incorporation?
A66 Although the submission of a lease contract is not mandatory,a fixed address is required.However, a lease contract shouldbe submitted when applying for business registration with thecompetent tax office after the registration of incorporation iscompleted with the registry office.
Q67 What are the precautions for a foreigne . . .
작성일 2023-10-24
2023
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27 |
FAQ on FDI in Korea 2023 (Q61~Q65)
■ FAQ on FDI in Korea 2023 (Q61~Q65)
Establishment of Corporation
Q61Is it true that a foreign-invested company cannot use the same trade name that is already used in Korea?
A61 Article 29 of the Commercial Registration Act (Unregistrable TradeNames) prescribes “No trade name same as a trade name registered by another merchant for the same type of business shall be registered in the same Special Metropolitan City, Metropolitan City, Special Self-governing City, Si (including an administrative Si) or Gun (excluding . . .
작성일 2023-10-18
2023
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26 |
FAQ on FDI in Korea 2023 (Q57~Q60)
■ FAQ on FDI in Korea 2023 (Q51~Q56)
Establishment of Corporation
Q57What is the process of establishing a corporation in Korea?
A57 There are four types of corporations - general partnership company,limited partnership company, stock company, limited companyand limited liability company – that can be established underthe Commercial Act of Korea. As a stock company represents anabsolute majority, the process of establishing a stock company isexplained below (the “Act” refers to the Commercial Act).
Q5 . . .
작성일 2023-10-11
2023
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25 |
FAQ on FDI in Korea 2023 (Q51~Q56)
■ FAQ on FDI in Korea 2023 (Q51~Q56)
FDI Notification&Registration
Q51 What are the administrative procedures under the Foreign Investment Promotion Act in case of splitting a foreign-invested company?
A51 When foreign-invested company A establishes new companyB through a corporate split (a spin-off)*, this results in acapital reduction for the surviving foreign-invested companyA. In this case, the foreign investor of company A should altera registration of a foreign-invested company pursuant toArticle 21 of t . . .
작성일 2023-10-05
2023
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24 |
FAQ on FDI in Korea 2023 (Q46~Q50)
■ FAQ on FDI in Korea 2023 (Q46~Q50)
FDI Notification&Registration
Q46 When a foreign investor remits investment funds in Korean won from a foreign country, can it still be recognized as foreign investment?
A46 In order to be recognized as foreign direct investment,investment funds should be remitted in foreign currency froma foreign country and exchanged into Korean won in Korea.It is because a certificate of purchase of foreign currency or acertificate of deposit of foreign currency should be submittedfor th . . .
작성일 2023-09-26
2023
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23 |
FAQ on FDI in Korea 2023 (Q41~Q45)
■ FAQ on FDI in Korea 2023 (Q41~Q45)
FDI Notification&Registration
Q41 Can the foreign currency funds remitted from a foreign country prior to notification of foreign investment be used in establishing a foreign- invested company?
A41 The Foreign Investment Promotion Act provides that a foreigninvestment made by a foreigner in the form of the acquisitionof new or existing stocks, etc. of a Korean corporation or acompany shall be notified prior to the investment. However,there is no specific regulation on the tim . . .
작성일 2023-09-19
2023
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22 |
FAQ on FDI in Korea 2023 (Q36~Q40)
■ FAQ on FDI in Korea 2023 (Q36~Q40)
FDI Notification&Registration
Q36 Can a long-term loan or a foreign loan be converted into capital through set-off? If yes, what is the procedure for notification of foreign investment?
A36 A long-term loan or a loan from a foreign country is notincluded in the definitions of object of investment* under theForeign Investment Promotion Act. However, an amendmentmade in April 2020 to the Commercial Act introduced aprovision that allows a set-off against payment for shares based . . .
작성일 2023-09-13
2023
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