DOING BUSINESS IN SOUTH KOREA IN 2021
Since 2003, Healy Consultants Group PLC has been efficiently and effectively assisting our Clients with i) South Korea business registration ii) business licensing iii) South Korea business banking solutions iv) visa options and staff recruitment strategies and v) workspace rental solutions.
Compare different South Korea entities | LLC | Free zone Company | Branch Office | Rep Office | LLP |
---|---|---|---|---|---|
Entity locally known as | Yuhan Hoesa | Free Economic Zone Company | Branch office | RO | Hapja Hoesa |
Best use of company? | SMEs | International Trading | Bank branches | Marketing | Professional Services |
Legally tax exempt if properly structured? | No | Yes (for 3 years) | No | Yes | No |
Corporate bank account location? | Woori Bank | Citibank | KEB Hana Bank | SCB Korea | Woori Bank |
Client must travel to Korea? | No | No | No | No | No |
Can secure trade finance? | Yes | Yes | Yes | No | No |
Limited liability entity? | Yes | Yes | No | No | Yes |
GST payable on sales to local customers | 10% | 10% | 10% | No | 10% |
Withholding tax on payments to overseas shareholders? | 22% | No | No | No | 22% |
Average total engagement costs? | US$11,953 | US$12,953 | US$12,703 | US$11,343 | US$9,953 |
Average total engagement period? | 4 weeks | 4 weeks | 5 weeks | 5 weeks | 4 weeks |
Accounting and tax considerations | LLC | Free zone Company | Branch Office | Rep Office | LLP |
---|---|---|---|---|---|
Statutory corporation tax payable? | 20% | 0% (for 3 years) | 20% | 0% | 0% |
Must file an annual Korea tax return? | Yes | Yes | Yes | No | No |
Effective corporation tax rate on net profits of US$250,000 | 13% | 0% (for 3 years) | 13% | 0% | 0% |
Must file annual financial statements? | Yes | Yes | Yes | No | No |
Investment income is legally tax exempt in Korea? | No | Yes (for 3 years) | No | No | No |
Access to double taxation treaties? | Yes | Yes | Yes | No | No |
This entity enjoys Government incentives? | Yes | Yes | Yes | No | No |
Monthly GST reporting to the Government? | No | No | No | No | No |
Legally tax exempt entity? | No | Yes (for 3 years) | No | Yes | Yes (if no services are provided in Korea) |
Dividends received are legally tax exempt? | No | No | No | No | No |
Company registration | LLC | Free zone Company | Branch Office | Rep Office | LLP |
Korea resident director\partner\manager required? | No | No | Yes | Yes | No |
Minimum number of shareholders\partners? | 1 | 1 | Parent Company | Parent Company | 2 |
Minimum number of directors/managers? | 1 | 1 | 1 | 1 | 1 |
Minimum paid up share capital? | US$1 | US$90,000 | US$1 | US$1 | US$1 |
Shelf companies available? | Yes | No | No | No | No |
Time to incorporate a new entity? | 2 weeks | 2 weeks | 3 weeks | 3 weeks | 2 weeks |
Can easily convert to a local PLC? | Yes | No | No | No | No |
Can have preference shareholders? | No | No | No | No | No |
Business considerations | LLC | Free zone Company | Branch Office | Rep Office | LLP |
Can invoice local customers? | Yes | Yes | Yes | No | Yes |
Can hire local staff? | Yes | Yes | Yes | Yes | Yes |
Can rent local office space? | Yes | Yes | Yes | Yes | Yes |
This entity can secure a residence visa for business owner? | Yes | Yes | Yes | No | No |
Good entity for trademark registration? | Yes | Yes | Yes | No | No |
Korea has signed free trade agreements? | Yes |
This country is a member of WIPO and TRIPS? | Yes |
The country is a member of the ICSID? | Yes |
Average customs duties suffered? | 8% |
LLC | Free zone Company | Branch Office | Rep Office | LLP | |
---|---|---|---|---|---|
Government foreign investment approval is required? | No | Yes | No | No | No |
Average monthly office rental? (US$ per sq m) | US$24 |
Minimum statutory annual salary? | US$11,294 |
Average monthly US$ salary for local employees? | US$3,180 |
Korea Won deposit interest rate? (1 year average) | 2% |
US$ deposit interest rate? (1 year average) | 0.34% |
Overseas remittance currency controls? | No |
Public register of shareholders and directors? | Yes |
Banking considerations | |
Multi-currency bank accounts available? | Yes |
Corporate visa debit cards available? | Yes |
Quality of e-banking platform? | Good |
Crowd funding available in this country? | Yes |