rocket
Introducing the Orbitax International Tax Platform, a revolutionary suite of integrated tax solutions including research, compliance, calculations, entity management and charting. Find out more.
News Share

The Tax Hub

Daily Tax Newsletter

Korea, Rep of

Responsive image

Overview of South Korea's 2019 Tax Revision Bill Published

South Korea's Ministry of Economy and Finance has issued an English-language release providing an overview of the 2019 Tax Revision Bill. The measures of the Bill are focused on boosting the economy and supporting industrial innovation, pursuing inclusiveness and fairness, and broadening the tax base and improving the tax system. Most of the key measures for companies relate to boosting the economy and supporting industrial innovation, and include the following as provided in the release:

Promote investment

  • Expand the facility investment tax reduction temporarily for one year if the investment is made to improve productivity:  From 1% to 2% (large conglomerates), from 3% to 5% (medium-sized companies), and from 7% to 10% (SMEs);
  • Extend the tax reduction for manufacturing facility investment and safety facility investment by two years, as well as expand industries eligible for the tax reduction:  Include pharmaceutical and logistics industries if they invest in high-tech equipment and facilities, and for safety investment tax reduction, expand it to energy pipelines, LPG facilities, and all equipment and facilities if the investment is aimed at improving safety;
  • Extend the 50% accelerated depreciation by six months to 30 June 2020, and expand it to investments made to improve productivity and save energy in addition to the investments made to foster innovation, such as R&D facilities investment and new growth engine facilities investment;
  • Extend the corporate tax reduction for startups doing business in restructuring-affected areas to provide a further 50% reduction for two years in addition to the 100% reduction that currently provided for five years;
  • Expand the corporate investment tax reduction to 5% for SMEs and 3% for medium-sized leading enterprises if they are doing business in regulation-free zones;
  • Ease requirements for corporate inheritance tax incentives: Obligations accompanying the tax incentive, such as staying in the same business and retaining employment for 10 years, to be changed to 7 years, and changes in business to be allowed within a broader category;
  • Expand the installment tax payment and grace period given to capital gains made due to moving manufacturing facilities from a two-year installment with a two-year grace period to a five-year installment with a five-year grace period;
  • Expand the tax deduction for losses incurred in the previous year from 60% of the earnings for the year to 100%; and
  • Increase the allowed deduction of maintenance costs from KRW 3 million to KRW 6 million.

Support industrial innovation

  • Expand the R&D tax reduction for new growth engines and source technologies to biobetters, systems-on-the-chip, and other technologies that will lead innovation-driven growth;
  • Extend the tax reduction carry-over to the next 10 years, which is given to R&D investment in new growth engines and source technologies;
  • Provide R&D tax reduction to foreign research institutes for projects commissioned by Korean companies;
  • Expand the capital gains tax exemption given to venture capital from the sales of old stocks to the sales of new stocks; and
  • Provide a 50% income tax cut for five years to Korean talents returning from overseas.

The 2019 Tax Revision Bill is to be finalized and submitted to the National Assembly on 3 September 2019.

Powerful Tax Tools

NEW

FX Rates

Global FX Rates including Tax Year Average FX Rates and Spot Rates for all Reporting Currencies.

NEW

Corporate Tax Rates

Corporate tax rates, surtaxes, and effective tax rates for the current year, as well as historical rates and approved future rates.

NEW

Country Analysis

Detailed tax guidance for companies doing business in over 100 countries, including summaries and snapshots of key tax facts and issues.

NEW

Cross Border Tax Calculator

Calculate total tax costs and benefits of a cross border transaction including withholding tax, participation exemption and foreign tax credit rules.

NEW

Cross Border Tax Rates

Provides Domestic, treaty and EU cross border tax rates for over 5,000 country combinations for 9 different payment streams.

NEW

OECD BEPS Project

Complete overview of the OECD BEPS Project, including daily BEPS news, country adoption of BEPS measures, and an overview of the 15 BEPS Actions.

NEW

Tax Calendar

Customizable calendar tool that tracks corporate income tax, value added tax and transfer pricing obligations by country or entity.

NEW

Tax Forms

English translations of key tax forms for over 80 countries, including tax return forms, treaty benefit forms, withholding tax forms, and more.

NEW

Worldwide Tax Treaties

Repository including thousands of tax treaties (in English), OECD, UN and US Models, relevant EU Directives, Technical Explanations, and more.

NEW

Worldwide Tax Planner

Calculates the worldwide tax cost of what-if scenarios based on legal entity structure, taxable income, and cross border transactions.

NEW

Certified Rates Report

Customizable Certified Rates Report providing updated corporate and withholding tax rates at the end of each month for over 100 countries.

NEW

Withholding Tax Minimizer

Enables quick calculation of tax costs and benefits of cross border transactions considering all possible transaction combinations and optimal routes.

NEW

VAT Rates

Provides value added tax (VAT) rates, goods and services tax (GST) rates and other indirect tax rates for over 100 countries.

NEW

NOL Calculator

Country specific calculator to determine how net operating losses can be utilized in carryback and carryforward years.

NEW

Transfer Pricing Calculator

Calculates TP ratios under various TP methods and calculates the difference between target ratios and actual ratios.

NEW

Individual Income Tax Rates

Individual tax rates for over 100 countries.

Play of the Day

Crosss Border Rates

Provides Domestic, treaty and EU cross border tax rates for over 5,000 country combinations for 9 different payment Streams.

We’re here to help

We’re here to answer any questions you have about the Orbitax products and services.

Send us a message

Who’s behind Orbitax?

We’re committed to providing high value, low cost tax research and management solutions.

Learn More