Korea to Reduce Corporate Tax for Mid-sized Companies

(Sunnyvale, CA) - The Korean government announced plans to reduce the top marginal corporate tax rate to 20% for companies with tax bases between 200 million won and 50 billion won in 2012.

However, the current corporate tax rate of 22% (effective rate of 24.2% including resident surtax) will be maintained for companies with a tax base of over 50 billion won.

According to the announcement, the new middle tax bracket was proposed to achieve financial stability and improve business benefits for the small and medium sized businesses.

The Korean government also proposed a slew of other changes and developments for the year 2012, some of which are listed below:

* Maintaining a top marginal corporate tax rate of 22% (effective rate 24.2%) and creation of a new middle tax bracket
*Unification of the VAT return due date of local companies and foreign companies.
*Maintaining the top marginal individual income tax rate of 35%.
*Tax Information Exchange Agreements to be signed between Korea, British Virgin Island and Costa Rica.
*NTS (National Tax Service ) targets offshore tax evasions

VAT Submission Due Date

The proposal also includes plans for foreign establishments to have the same due date (e.g., a branch or a permanent establishment in Korea) for VAT submissions as the local companies, which is within 25 days from each quarter end. Currently, foreign companies are allowed to file the VAT return within 50 days from each quarter end.

Tax Evasion

The Korean taxation board, the National Tax Service is also said to be actively investigating tax evasion cases against such individuals who have allegedly concealed personal holdings and earnings in offshore accounts.

The proposed revisions above will be applied for the fiscal year starting on or after January 1, 2012 if the proposed tax law changes are passed by the National Assembly.

Please call or email if you need more details on how the Korea’s corporate tax and other changes can affect your business.

About Nair & Co.

Nair & Co. provides you with your one touch outsourced finance, internal audit compliance, HR and legal department for your international operations. If you are expanding abroad for the first time, our turnkey solution will help you do so with minimal risk, stress and cost. We currently support more than 1000+ client operations in over 50 countries and have core offices in U.K., India, China, U.S., Japan and Singapore. Nair & Co. was named among the top 100 outsourcing services providers in the world by the International Association of Outsourcing Professionals (IAOP). Learn more at www.nair-co.com

Nandita Verma
Nair & Co.
nandita.verma@nair-co.com
408-515-9048
Nair & Co., 1250 Oakmead Parkway, Suite 210
Sunnyvale, CA 94085 United States

This release was published on openPR.