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The Special Tax Treatment Control Law of Korea extended the benefit of the Flat Tax to 20 years from the present five years. The flat tax rate with the local income tax is 20.9%. of the foreign employee’s earned income.
Additionally, the National Tax Services of Korea and the Ministry of Economy & Finance of Korea agreed to deem the starting date for employment to be January 1, 2014, even if the foreigner worked in Korea prior to 2014. Thus, foreigners shall be able to claim the flat tax until December 31, 2033, even if they were employed in Korea prior to 2014. This is great news for long-term residents of Korea.
Additionally, if the foreigner leaves Korea and commences working in Korea again, the limitation period shall commence on the day of reemployment in Korea and not when first employed in Korea.
This amendment to the Special Tax Treatment Control Law of Korea is welcomed by investors in Korea and shall do its part in encouraging more investment in Korea. We have great hope that the present administration shall be much more friendly to investors in Korea. This development and the further development of free trade zones is a great step in the right direction.
For a consultation with an attorney or our in-house CPA, schedule a call with IPG Legal. Please note, that we have an affiliated tax accountant and CPA that files taxes for foreign businesses, foreign employees, and entrepreneurs. Please note your specific need when scheduling a call and we shall get the right person on the line for your call with us.
