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More guided
information on some tax issues
News Source : Ministry of
Finance & Economy
Seoul, May 03 2006 (Korea Newswire)--
The alleged media reports that the Korean National Tax
Service (NTS) has launched tax audits into foreign companies
operating in Korea are groundless and hapless.
NTS's activities and measures, collectively put as "tax
audit" in the reports, are just conventional and normal
operational activities of the NTS as tax authorities of any
country would undertake as part of their business as usual.
The main misleading points are the following.
Keeping taxpayers' information up-to-date
In case where a duly registered company has suspended or
discontinued its business operation, and/or in case where
there has been any change in investor(s) details such as
shareholder structure and nationality of the investor(s)
concerned from the time of the submission of application for
investment in Korea, such changes need to be duly maintained
with NTS.
It facilitates the NTS to keep up with the latest basic
information on the company concerned as well as to provide
it with tailored services.
The same procedure applies indiscriminately to all
registered businesses in Korea regardless of the nationality
of the investors concerned.
Conducting fact-finding on liaison offices of foreign
companies
Although liaison offices of foreign companies are not
subject to corporation tax in Korea, they are required to
withhold taxes from compensations paid to their employees.
Therefore, NTS conducts simple fact-finding on such liaison
offices with a view to confirming whether or not they are in
full compliance with such withholding obligation.
Verifying information on commercial performances by foreign
entertainers in Korea
With regards to the captioned performances, NTS verifies
whether or not the taxes have been withheld appropriately,
with reference to the information submitted under the
Taxation-Related Information Submission and Control Act
The above explanations will serve as the sufficient source
of clarification of the misleading reports on taxpayers'
information, fact-finding, and information verification.
