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  • Overseas Office Establishment
    • 담당부서 : 외투기업고충처리실(고상원)
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  • Organization : Self disposal
  • Regulation : Information searching from EIU(EconomicIntelligence Unit)
Grievance
Grievance
Company I exports software. As a result, they have to send engineers to the export destination to offer aftercare services. This required engineers to remain in that location for at least 6 months at a time.

According to tax agreements, in cases of an extended stay in a particular country, if there is an established place of employment, then tax problems arise.

In order to resolve these problems, they intend to establish a local branch in Korea. In order to do this, they would first have to analyze corporate tax rates and business plan. They also asked if the office of the ombudsman could provide them with help in gathering information.

Resoultion and Results
Resolution and Results
* Investigative Results
IK contacted the National Tax Service to find out if it would be possible to get the necessary information, however we had to gather the information from their website and that of the Economic Intelligence Unit.

* Notice to Company
Corporate Tax System and Tax RatesThe tax systems of the countries in question are much like Korea’s. Companies must pay corporate, national and local taxes.

In other words, they must pay a national corporate tax on corporate income, local enterprise tax, inhabitant tax, income taxes and asset tax. The standard tax imposed for valid tax rates is 40.87% (http://www.nta.go.jp/) There is also a mid-year pre-payment system under which they can pay 50%, just as in Korea.

The average corporate tax is 30%, local enterprise tax is 7.2%. For SMEs only 22% of corporate tax applies. Local enterprise taxes for imposition of income tax for earning below 4 million equals 5%, between 4-8 million is 7.3% and over that standards for large conglomerates apply.Resident tax is assessed at 5-20.7% and collected automatically by the local autonomous government body.