Foreign companies are not required to have a local presence in South Korea in order to register for VAT; however, they must appoint a Korean fiscal representative. With respect to domestic business, these can also use the services of such an agent optionally.
Below, our company formation agents in Korea offer guidance concerning the services provided by a tax agent.
The following are among the fiscal representation services foreign companies can obtain in Korea:
A Korean fiscal representative is viewed by the tax authorities as the foreign trader’s local agent, which meets the national compliance requirements.
Reporting and payment of VAT to the Korean authorities are the joint responsibility of the representative and the non-resident company. Furthermore, the agent is in charge of all correspondence between the respective business and the tax authorities.
You can also rely on our local agents if you want to start a business in Korea and need such a service. This solution is more often covered by our accountant in Korea.
In terms of fiscal representation, foreign companies making taxable supplies in South Korea must comply with the statutory obligation to register for VAT for certain operations. Once registered, non-resident traders must comply with local filing rules,
Usual situations requiring Korean VAT registration include:
These are also operations that require complying with VAT paperwork drafting and which can be handled by a Korean tax agent.
Accountants, tax advisors and lawyers can act as fiscal representatives on behalf of non-resident businesses in South Korea. In some countries these provide general or limited fiscal representation, which would often affect the extent of obligation and responsibilities involved. In Korea, clients can choose the services they want to benefit from apart from the mandatory ones.
If you are a foreign citizen and want to immigrate to South Korea with the purpose of setting up your own business, you can also opt for such a service.
As stated in the introduction, local businesses can also ease the burden of having to deal with the tax authorities in relation to tax payments. For this reason, they can hire the services of a fiscal representative. This way, they can avoid penalties and late fees associated with the non-payment of VAT and other taxes.
We are also at the service of Korean businesses with fiscal representation solutions.
Here are the main VAT requirements to comply with, according to the National Tax Service: