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Why Grant Thornton
Whether you’re growing in one market or many, looking to operate more effectively, managing risk and regulation, or realising stakeholder value, our firms can help.
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Culture and experience
Grant Thornton’s culture is one of our most valuable assets and has steered us in the right direction for more than 100 years.
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Global scale and capability
Beyond global scale, we embrace what makes each market unique, local understanding on a global scale.
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Join our network
In a world that wants more options for high quality services, we differentiate in the market to grow sustainably in today’s rapidly changing environment.
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Leadership governance and quality
Grant Thornton International Ltd acts as the coordinating entity for member firms in the network with a focus on areas such as strategy, risk, quality monitoring and brand.
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Africa
24 member firms supporting your business.
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Americas
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19 member firms with nearly 25,000 people to support you.
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The relationship between a company and its auditor has changed. Organisations must understand and manage risk and seek an appropriate balance between risk and opportunities.
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As organisations become increasingly dependent on digital technology, the opportunities for cyber criminals continue to grow.
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At Grant Thornton, we have a wealth of knowledge in forensic services and can support you with issues such as dispute resolution, fraud and insurance claims.
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We work with entrepreneurial businesses in the mid-market to help them assess the true commercial potential of their planned acquisition and understand how the purchase might serve their longer-term strategic goals.
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Recovery and reorganisation
Workable solutions to maximise your value and deliver sustainable recovery.
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Transactional advisory services
We can support you throughout the transaction process – helping achieve the best possible outcome at the point of the transaction and in the longer term.
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Valuations
We provide a wide range of services to recovery and reorganisation professionals, companies and their stakeholders.
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IFRS
At Grant Thornton, our IFRS advisers can help you navigate the complexity of financial reporting from IFRS 1 to IFRS 17 and IAS 1 to IAS 41.
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Audit quality monitoring
Having a robust process of quality control is one of the most effective ways to guarantee we deliver high-quality services to our clients.
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Global audit technology
Our global assurance technology platform provides the ability to conduct client acceptance, consultations and all assurance and other attestation engagements.
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Corporate and business tax
Our trusted teams can prepare corporate tax files and ruling requests, support you with deferrals, accounting procedures and legitimate tax benefits.
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Direct international tax
Our teams have in-depth knowledge of the relationship between domestic and international tax laws.
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Global mobility services
Through our global organisation of member firms, we support both companies and individuals, providing insightful solutions to minimise the tax burden for both parties.
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Indirect international tax
Using our finely tuned local knowledge, teams from our global organisation of member firms help you understand and comply with often complex and time-consuming regulations.
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Transfer pricing
The laws surrounding transfer pricing are becoming ever more complex, as tax affairs of multinational companies are facing scrutiny from media, regulators and the public
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Africa tax desk
A differentiating solution adapted to the context of your investments in Africa.
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Banking Holding banking to account: the real diversity and inclusion pictureWe explore how the banking sector can continue to attract, retain and nurture women to build a more diverse and inclusive future.
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Sustainability From voluntary to mandatory ESG: How banks can future-proof their operationsAs we move from voluntary ESG initiatives to mandatory legislation, we explore what the banking sector needs to prioritise.
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IFRS IFRS 9 - Audit of Expected Credit LossesGPPC releases The Auditor’s response to the risks of material misstatement posed by estimates of expected credit losses under IFRS 9
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growthiQ Steering your company to long-term successHistory has something important to tell us about the difficulties of steering a business to long-term success – through seismic shifts in technology, consumer demands and product development. With that in mind it’s unsurprising that over half the world’s largest companies in the early 1900s had shut their doors by the late 1990s. Some, however, have endured.
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International Financial Reporting Standards Implementation of IFRS 17 ‘Insurance Contracts’The auditor’s response to the risks of material misstatement arising from estimates made in applying IFRS 17 ‘Insurance Contracts’
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IFRS Get ready for IFRS 17After twenty years of development the IASB has published IFRS 17 ‘Insurance Contracts’, find out more.
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis A very uneven recovery across industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - Sector analysis Clear patterns of damage from COVID-19 across the industriesThe index results for 12 key sectors of the mid-market reveal just how much or little the various parts of the economy were impacted by COVID-19.
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Not for profit Mission: possible – putting impact at the heart of charityGlobal charitable continues to decline and charity leaders are increasingly looking at their own unique impact journey.
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Access to finance Raise finance to invest in changePrepare your business to raise finance to invest in change.
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Private equity firms Private equity in the mid-market: reshaping strategies for 2021When the global COVID-19 pandemic stormed across the globe in early 2020, the private equity sector was hit hard but deals are coming back to the market.
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Mid-market businesses Getting ready for private equity investmentOur specialists explore how private equity firms are now working with their portfolios and how the mid-market can benefit from investment.
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Mid-market businesses Myth-busting private equityNervous about partnering with Private Equity? We explore some of the common myths we come across when speaking to mid-market businesses about PE investment.
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Public sector Helping build the government of tomorrow, todayLearn about the Grant Thornton US public sector team.
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis A very uneven recovery across industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - Sector analysis Clear patterns of damage from COVID-19 across the industriesThe index results for 12 key sectors of the mid-market reveal just how much or little the various parts of the economy were impacted by COVID-19.
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Industries European Real Estate PodcastJessica Patel, Tax Partner at Grant Thornton UK speaks with tax partners and directors across the network to share their insights on the real estate market and some of the challenges.
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Industries European Real Estate PodcastJessica Patel, Tax Partner at Grant Thornton UK speaks with tax partners and directors across the network to share their insights on the real estate market and some of the challenges.
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis A very uneven recovery across industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis A very uneven recovery across industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Retail How retail is positioning for successCOVID-19 provided some hard lessons for the retail industry. It is time to turn those into sustainable and well executed growth strategies in 2021.
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Telecoms Can tech and telecom leverage economic headwindsAs most businesses brace for an economic downturn, tech and telecom could see new prospects. But, to turn the headwinds to your advantage, you need to find your unique opportunities and risks.
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Technology Mid-market tech companies lead the way on diversity and inclusionWe explore how the mid-market tech sector can continue to build and nurture a culture that’s increasingly more diverse and inclusive for women.
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Tax Resetting global tax rules after the pandemicBusinesses are seeing rising challenges, and finance heads are dealing with a range of new measures. To say the next 12 months are critical for businesses is an understatement.
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TECHNOLOGY International tax reform: the potential impact on the technology industryIn this article, we’ve summarised key elements of the global tax reform proposals, their potential impact on technology industry and advice from our digital tax specialists on what technology companies can do to prepare.
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Telecoms Can tech and telecom leverage economic headwindsAs most businesses brace for an economic downturn, tech and telecom could see new prospects. But, to turn the headwinds to your advantage, you need to find your unique opportunities and risks.
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TMT TMT industry: Fully charged or on standby?Our research revealed five key trends that resonated with Technology, Media and Telecoms (TMT) industry leaders around the world. We asked a panel of our experts from UK, US, India Ireland and Germany, to give us their reaction to the findings.
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Cybersecurity One size fits nothingTechnology companies must adopt a new approach to digital risk: those that successfully develop a reputation for digital trust by demonstrating an unwavering commitment to cyber security and data privacy will be able to carve out a competitive advantage.
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Technology, media & telecommunications Why it’s time for a 5G reality checkFigures suggest the mobile sector is maturing. While data usage continues to soar, mobile revenues are expected to flatten out over the next few years.
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International business Mid-market businesses lifted by rising tide of optimismOptimism among global mid-market business leaders rose to 67% in the first half of this year and they are markedly more optimistic about their prospects with global optimism having increased by 8%.
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Hotels COVID-19: Checking in with the hotel industry one year onCOVID-19 provided some hard lessons for the hotel sector. It is time to turn those into sustainable and well executed growth strategies.
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Women in Business 2024
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COP28: Mid-market firms should seize the opportunity from adaption and innovation
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Women in tech: A pathway to gender balance in top tech roles
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Women in leadership: a pathway to better performance
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Women in Business 2024
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Women in business: Regional picture
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Pathways to Parity: Leading the way
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IFRS Alerts
IFRS Alerts covering the latest changes published by the International Accounting Standards Board (IASB).
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Example Financial Statements
General guidance for preparers of financial statements that supports the commitment to high quality, consistent application of IFRS.
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Insights into IFRS 2
Insights into IFRS 2 summarises the key areas of the Standard, highlighting aspects that are more difficult to interpret and revisiting the most relevant features that could impact your business.
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IFRS 3
Mergers and acquisitions are becoming more common as entities aim to achieve their growth objectives. IFRS 3 ‘Business Combinations’ contains the requirements for these transactions.
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IFRS 8
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IFRS 16
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IAS 36
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IFRS 17
Explaining the key features of the Standard and providing insights into its application and impact.
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Pillar 2
Key updates and support for the global implementation of Pillar 2.
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Global expatriate tax guide
Growing businesses that send their greatest assets – their people – overseas to work can face certain tax burdens, our global guide highlights the common tax rates and issues.
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International indirect tax guide
Navigating the global VAT, GST and sales tax landscape.
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Global transfer pricing guide
Helping you easily find everything you need to know about the rules and regulations regarding transfer pricing and Country by Country reporting for every country you do business with.
Indirect tax snapshot
Please click on each section to expand further:
Value Added Tax (VAT) is the main type of indirect taxation in South Korea.
Overview
In general, a business entity (individual as well as company) should collect 10% VAT from customers when it supplies goods or services, along with issuance of VAT invoices, and then remit the VAT (net of input VAT paid to vendors upon purchase of goods or services) to the tax authorities on quarterly basis with filing VAT return. VAT return is due within 25 days after each calendar quarter ends.
Zero rate VAT
Followings are subject to zero rate VAT (that is, no VAT shall be charged).
- Goods exported to abroad
- Goods or services supplied to foreign embassies/consulates/diplomats stationed in Korea, subject to certain conditions
- Goods shipped to a domestic business entity carrying out VAT-taxable businesses under a contract entered into with non-residents, for consideration collected in foreign currency from the non-residents
- Certain services (like professional & technology services, business support services and marketing services, etc.) supplied to non-residents for consideration in foreign currency, when the same tax treatment (i.e., exemption from VAT, GST or any other indirect taxes or zero rate applied) is granted to services supplied to Korean residents in the jurisdiction where the non-residents reside.
VAT exempted goods or services
While most transactions are VAT-taxable, VAT Act enumerates dozens of goods and services as VAT-exempted ones, among which listed below are important ones.
- Unprocessed agricultural / livestock / fishery / forestry products
- Medical services
- Education services meeting certain qualification
- Public transportation
- Books, newspaper and magazine
- Tabaco meeting some conditions
- Financial & insurance services
- Rent of residential house
- Land
- Certain professional services rendered by an individual
While the supplier of VAT-exempted goods or services are not required to collect VAT from customers, they cannot reclaim input VAT paid to vendors.
Non-reclaimable input VAT
In general, a business can reclaim input VAT paid upon purchase of goods or services as far as it uses those goods or services for its VAT-taxable businesses (subjected to 10% or zero percent) and receive legitimate VAT invoices describing the transactions exactly. As exceptions, input VAT paid upon with following purchases cannot be reclaimed.
- Input VAT associated with purchase or lease / rental of non-business purpose passenger cars or operation thereof (like gas, maintenance & repair, parking fee and toll fee, etc.)
- Input VAT associated with entertainment expenditures (such as meal & drink, gift or golf, etc. for customers or vendors, etc.)
- Input VAT associated with expenditures made out of business purpose
- Input VAT associated with acquisition of land (including capital expenditures for land)
VAT on imported goods and services
While VAT on domestically traded goods or services are collected by suppliers, VAT on imported goods is collected by the customs authorities along with customs duty from importers.
For services purchased from non-resident suppliers, in general, the purchaser should pay reverse charge VAT (@10%) to the tax authorities when the service fee is paid. If the service is used for VAT-taxable business, such reverse charge VAT is exempted.
No.
N/A. Any non-resident individuals or foreign corporations who have a business place in Korea should register with the tax authorities. Non-resident suppliers of electronic services to Korean consumers (in B2C transactions) should also register with the tax authorities even though they do not have a business place in Korea.
With effect from July 1, 2015, non-resident suppliers are required to register with the tax authorities and collect VAT (at 10%) for electronic services from Korean consumers and remit the VAT to the tax authorities for every quarter.
It may be necessary to appoint a fiscal representative in order to register with the tax authorities if non-resident individuals or corporations do not have their own employees in Korea.
A business should, in general, file VAT return for every calendar quarter along with payment of VAT within 25 days after each calendar quarter ends.
A penalty amounting to 20% of underpaid tax will be levied if a business does not file VAT return by due date. The penalty may be relieved by 20~50% if an overdue return is filed within 6 months.
In addition, interest charge shall be levied until the underpaid VAT is paid at certain interest rate (currently 8.03% per annum).
A business should declare not only supplies of goods or services but purchases from vendors to the tax authorities in VAT return by submitting the schedule of output VAT invoices issued to customers as well as input VAT invoices received from vendors.
For service fee paid abroad, a business carrying out VAT-exempted business should pay reverse charge VAT (at 10%) for every quarter.
Penalties can be imposed for a range of errors or omissions such as underreporting of taxable supplies or purchase from vendors, no or incorrect issuance of VAT invoices, etc.
Non-resident individuals or foreign companies can reclaim input VAT charged by local vendors if they have received VAT invoices from local vendors, subject to certain conditions. To receive VAT invoices from vendors, they would need to register with the tax authorities as representative office.
A VAT invoice must show as mandatory:
- The supplier’s name and tax registration number
- The customer’s tax registration number
- The transaction amount and corresponding VAT
- Date of preparation of the VAT invoice
In addition, the following may be written in the VAT invoice as elective:
- The supplier’s address
- The customer’s name and address
- The business type and industry category of the supplier and customer
- Goods or services supplied
- Unit price and quantity
- Date of supply
- The business place where the supply takes place in case of business which elected consolidated VAT filing.
A business (corporations as well as individual businessmen over certain threshold) should issue electronic VAT invoices through the tax authorities’ system, ERP system meeting certain qualification or licensed IT service providers and such VAT invoices should be forwarded to the tax authorities.
Contact us
For further information on indirect tax in South Korea please contact:
Jeong Guen Lee |
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