There are new forms for country-by-country (CbC) reporting and for the advance notification as to which company of a multinational group is to be the “reporting entity.” These forms were introduced by the Korean tax authority (known, in English, as the Tax & Customs Office of the Ministry of Strategy and Finance).
Both a Master file and a Local file must be submitted for fiscal years beginning on or after 1 January 2016, by all domestic corporations and foreign corporations with Korea-source income when:
The Master file and Local file are to be filed with the head of the tax office having jurisdiction over the place where the tax payment is remitted, within 12 months from the fiscal year-end.
The CbC report is also required to be submitted by domestic corporations (ultimate parent company) when the prior year’s consolidated sales revenue exceeds KRW 1 trillion.
These reporting requirements were proposed in late 2016. Read TaxNewsFlash-Transfer Pricing
The tax authority also updated the rules on the arm’s length interest rate applicable for loan transactions between a resident and a foreign related-party. The new rules set forth, among other items, the arm’s length interest rate for lending and borrowing involving a Korean resident taxpayer to a foreign related party.
For more information, contact a tax professional with KPMG’s Global Transfer Pricing Services practice in South Korea:
Gil Won Kang | +82-2-2112-0907 | firstname.lastname@example.org
© 2019 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.