Tax Deductions for Koreans and Foreigners

Tax Credit for Integrated Investment

Enhancing tax credit for facilities and R&D investment in new growth and source technologies, national strategic technologies (semiconductor, secondary battery, vaccine, display, hydrogen and future mobility, biopharma)

Tax Credit for National Strategic Technology Facilities·R&D

Tax Credit for National Strategic Technology Facilities·R&D
Category	Facility Investment (%)				R&D Investment (%)
	Current			Increase	Conglomerate	Middle Standing	SME
	Conglomerate	Middle Standing	SME	Increase	Conglomerate	Middle Standing	SME
General	1	5	10	3	2	8	25
New Growth·Source Technology	3	6	12	3	20~30		30~40
National Strategic Technology	15	15	25	4	30~40		40~50

Increasing Basic Tax Credit Rate Applied to Tax Credit for Investment in National Strategic Technology Facilities

Increasing the basic tax credit rate applied for investment in national strategic technology facilities, 8→15% for large·middle standing corporations and 16→25% for SMEs, while increasing additional tax credit rate for an increase in investment and introducing temporary investment tax credit exclusively for the tax year ending December 31, 2023

* Partial revision and enforcement of Act on Restriction on Special Cases Concerning Taxation (April 11, 2023)

(Revised Act on Restriction on Special Cases Concerning Taxation) Investment Tax Credit Rate (%)

(Revised Act on Restriction on Special Cases Concerning Taxation) Investment Tax Credit Rate
Category		Current			Increase (Additional tax credit for 2023)
Category		Conglomerate	Middle Standing	SME	Increase (Additional tax credit for 2023)
Introduction of temporary investment tax credit	General	1 → 3	3 → 5 → 7	10 → 12	3 → 10
Introduction of temporary investment tax credit	New Growth·Source Technology	3 → 6	5 → 6 → 10	12 → 18	3 → 10
Increasing tax credit for national strategic technology	National strategic technology	6 → 8 → 15	8 → 15	16 → 25	4 → 10

* Total investment tax credit amount = (investment amount × deduction rate for current period) + (increase compared to 3-year average × deduction rate for increase)

Enlarge the Scope of National Strategic Technology and New Growth ·Source Technology

Expand the scope of new growth · source technology and national strategic technology to support R&D in energy, carbon neutrality, and display
* Partial revision·enforcement of Attached Table 7, 7.2 of Act on Restriction on Special Cases Concerning Taxation on Feb. 28, 2023
Expand and specifiy the scope of national strategic technologies with stipulating semiconductor, secondary battery, vaccine, display, hydrogen and future mobility in legislation
* Partial revision·enforcement of Article 10 of Act on Restriction on Special Cases Concerning Taxation (April 11, 2023) Partial revision·enforcement of Attached Table 7.2 of Act on Restriction on Special Cases Concerning Taxation (June 7, 2023)
Core technologies of biopharma sector changed from new growth·source technology or added to national strategic technology
* Partial revision·enforcement of Article 7.2 of Act on Restriction on Special Cases Concerning Taxation (August 29, 2023)

Tax Reductions or Exemptions for Companies in Enterprise Cities, Special Research and Development Zones, etc.

기업도시, 연구개발특구 등 지역특구 입주 세액 감면 표로 지원구분,감면요건 관련규정,법인세 감면 정보 제공
Business Location	Related Law	Corporate Tax Reduction or Exemption Rate
Special research and development zone	Article 12.2 of the Restriction of Special Taxation Act	100% exemption for 3 years + 50% reduction for 2 years thereafter
Enterprise city, Regional development zone	Article 121.17 of the Restriction of Special Taxation Act
Jeju-do	Article 121.8~9 of the Restriction of Special Taxation Act
Yeosu Expo Special Zone	Article 121.17 of the Restriction of Special Taxation Act
Saemangeum Investment Promotion Zone	Article 121.17 of the Restriction of Special Taxation Act
Asian Cultural Hub City Investment Promotion Zone	Article 121.20 of the Restriction of Special Taxation Act
Financial hub	Article 121.21 of the Restriction of Special Taxation Act
High-tech medical complex	Article 121.22 of the Restriction of Special Taxation Act

Tax Credit for Companies that Increased Employment

Where the number of full-time employees of a company has increased from that of the previous taxable year, a certain amount (KRW 4 mil.-13 mil.) per increased employee is deducted from corporate tax.

(Unit: KRW 10,000)

고용증대세제 지원 (고용증가 1인당 공제 금액) 표로 중소기업(수도권,지방),중견기업,그 외 기업 정보 제공
Employees	SME		Middle Standing		Conglomerate
Employees	Inside Seoul Metropolitan Area	Outside Seoul Metropolitan Area	Inside Seoul Metropolitan Area	Outside Seoul Metropolitan Area	Inside Seoul Metropolitan Area	Outside Seoul Metropolitan Area
Full-time young adults, the disabled	1,100	1,300	800	900	400	500
Other full-time workers	700	770	450	450	-	-

* Deduction period: Three years for SMEs and middle standing enterprises, two years for others / Applicable period: December 31, 2024
* Related laws: Article 29.7 of the Restriction of Special Taxation Act, Article 26.7 of the Enforcement Decree of the Act

Tax Reductions or Exemptions for Startups in Employment or Industrial Crisis Areas

For a company that started one of the designated businesses or established a new place of business (excluding relocation of existing business) in an industrial crisis zone no later than Dec. 31, 2023, 100% of corporate tax is exempted for five years starting from the year in which income occurred for the first time, and 50% of corporate tax shall be reduced for two years thereafter (for companies other than SMEs, a ceiling for reduction/exemption shall apply)

* Related law: Article 6.3 of the Restriction of Special Taxation Act
* Related law : Article 99.9 of the Restriction of Special Taxation Act

Tax Credit for SMEs

Category	Requirements for Tax Reductions or Exemptions	Corporate Tax Reduction or Exemption Rate
Startups	18 types of small- and medium-sized startups as prescribed by the Restriction of Special Taxation Act, such as manufacturing, construction, restaurants, telecommunications, etc.	Youth-led, small businesses: - Metropolitan overpopulation control regions: 50% for 5 years - Others: 100% for 5 years Venture · new energy technology startups: - 50% for 5 years New growth service industry: - 75% for 3 years + 50% for 2 years Other startups - Outside Metropolitan overpopulation control regions: 50% for 5 years * Up to 100% depending on job creation compared to the previous year
General SMEs	48 types of small- and medium-sized enterprises prescribed by the Restriction of Special Taxation Act, such as manufacturing, mining, and construction	Special tax reductions or exemptions (5~30% of corporate tax) * The reduction rate varies depending on the location, industry, and size of the company

※ Related law: Article 6, 7 of the Restriction of Special Taxation Act

Invest KOREA

KOTRA site