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For foreign companies in Korea
Accounting for your Korean branch, reported in English
In short We keep the books, file Korean taxes and send your head office a monthly report in English for branches and liaison offices of foreign companies. A branch files corporate tax and VAT like a Korean company. A liaison office does not pay corporate tax if it only does preparatory or auxiliary work, but it still has payroll and social insurance duties.
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Branch or liaison office
| Branch (지점) | Liaison office (연락사무소) | |
|---|---|---|
| What it can do | Sell, provide services, earn income in Korea | Market research, information gathering, advertising and other auxiliary work only |
| Registration | Business registration number | Unique (non-business) number |
| Corporate tax | Yes, on Korean-source business income | No, if activities stay auxiliary |
| VAT | Yes, quarterly | No sales, so generally no VAT return |
| Branch profits tax | Possible, if the tax treaty allows | No |
| Payroll withholding and social insurance | Yes | Yes |
Basis: Corporate Tax Act Articles 94 (permanent establishment), 96 (branch profits tax) and 97 (filing). If a liaison office starts closing contracts or earning income, it can become a permanent establishment, so we review its activities each year.
What we do
| Service | Details | When |
|---|---|---|
| Bookkeeping | Monthly ledger in Korean GAAP, bank and card reconciliation, intercompany balances | Monthly |
| Payroll | Withholding tax returns, payslips, social insurance, severance calculations | Monthly (10th) |
| VAT | Quarterly VAT returns, e-invoices, zero-rated export services | Jan, Apr, Jul, Oct |
| Corporate tax | Annual return, tax adjustments, branch profits tax review | Within 3 months after year-end |
| Year-end settlement | Employee tax settlement and statements | February–March |
| English monthly report | P&L, balance sheet, cash and tax calendar in English | Monthly |
English monthly report (MR)
Every month your head office receives a short report in English, prepared from the Korean books.
Reports can follow your group's chart of accounts or reporting template if you share it. See a sample report (hypothetical figures).
Korean tax calendar
| Deadline | Filing |
|---|---|
| 10th of every month | Withholding tax on salaries and other payments |
| Jan 25 / Apr 25 / Jul 25 / Oct 25 | VAT returns (branches) |
| March 10 | Year-end tax settlement and payment statements for employees |
| March 31 | Corporate tax return (December year-end branch) |
| August 31 | Interim corporate tax prepayment (December year-end) |
If a deadline falls on a weekend or public holiday, it moves to the next business day.
Turning a branch into a Korean subsidiary
Some head offices start with a branch and later want a Korean company, for local contracts, hiring or limiting liability. We handled this for a foreign company's Korean office: the branch business was transferred to a new Korean company as a going concern.
| What we check | Why it matters |
|---|---|
| Transfer of the whole business | If the entire business moves, it is not a supply of goods for VAT (VAT Act Article 10(9)2), so no VAT on the transfer |
| Goodwill valuation | The customer base and trading history have a value under Korean tax rules. We prepare the valuation report the tax office expects |
| Cut-off date | Receivables, payables, inventory and staff are listed as of one date and attached to the transfer agreement |
| Final branch return | The branch files its last corporate tax return, including any gain on the transfer |
Fees
Monthly bookkeeping for a company starts at KRW 120,000 per month for annual revenue under KRW 100 million, VAT excluded. This is the same price as our published Korean fee table. Payroll, the English monthly report and the annual corporate tax return depend on headcount and transaction volume, so we send a written quote in English after a short call. We reply to every inquiry within 24 hours.
How we start
- Short call or email Tell us whether you are a branch or liaison office, your head office country, headcount and fiscal year.
- Scope and fee We send a written scope and monthly fee in English.
- Handover We collect last year's filings and this year's ledger and reconcile opening balances.
- First report You receive the first English monthly report after the first month closes.
Common questions, answered in detail
FAQ
Does a liaison office in Korea pay corporate tax?
Generally no. If the office only carries out preparatory or auxiliary activities such as market research, information gathering or advertising, it is not a permanent establishment under Article 94(4) of the Corporate Tax Act. It still has to withhold income tax on salaries, run the annual year-end tax settlement for its staff and pay social insurance.
When does a branch file its corporate tax return?
A branch files like a Korean company: within three months after the end of its fiscal year (by March 31 for a December year-end). Extension can be approved for specific reasons under Article 97(2).
What is the branch profits tax?
An additional tax on a branch's after-tax profits, levied only when the tax treaty between Korea and the head office country allows it (Article 96). The rate is 20% under Korean law (Article 98(1)2) or the treaty rate, and amounts reinvested in Korea can be deducted. We check your treaty before the first filing.
Can you report to our head office in English?
Yes. We send a monthly report in English and answer emails in English. Statutory filings are made in Korean, and we explain each one in English.
Can a branch be converted into a Korean subsidiary?
Yes. The usual route is to set up a Korean company and transfer the whole branch business to it. A transfer of an entire business is not treated as a supply of goods for VAT (VAT Act Article 10(9)2), so the assets can move without VAT if the conditions are met. The branch's goodwill (customer base and trading history) is valued under the Korean tax rules, and the branch files its final corporate tax return on the gain.
How much does it cost?
Monthly bookkeeping for a company starts at KRW 120,000 for annual revenue under KRW 100 million, VAT excluded, the same as our published Korean fee table. Payroll, the English monthly report and the annual return depend on headcount and transaction volume, so we quote them in writing after a short call.
Can you take over from our current accountant mid-year?
Yes. We need the general ledger and tax filings for the year to date. We reconcile the opening balances first so the year-end figures are consistent.
Seojin Tax Corporation, Yeouido, Seoul (2 minutes from National Assembly Station, Line 9). Registered with the Korean Association of Certified Public Tax Accountants, No. 9105103. Previously in the international tax team at Hana Tax Corporation (2022 to 2024), then Beyul Accounting Corporation and Baekhwa Law Office. I handle each client from the first call to the filing.
Contact
Email works best for us. Please include your entity type (branch or liaison office), head office country and number of employees in Korea.