South Korea

Company Formation in South Korea

South Korea

Formation Time

2–3 weeks

Min. Capital

KRW 100 million (for D-8 visa) / KRW 100 (statutory)

Corporate Tax

9% (first KRW 200M) – 24%

Foreign Ownership

100%

Overview

South Korea is the world's 13th-largest economy and a global titan in semiconductors, automotive, rechargeable batteries, consumer electronics, and cultural entertainment (K-Culture). Foreign direct investment is regulated under the Foreign Investment Promotion Act (FIPA), which provides extensive investor safeguards and tax exemptions. The standard corporate entity for international investors is the Yuhan Hoesa (Limited Liability Company) or Chushik Hoesa (Stock Corporation). Corporate income tax follows a progressive scale starting at just 9% on the first KRW 200 million (~USD 150,000) of taxable profit, stepping up to 19% up to KRW 20 billion. With 93 bilateral tax treaties, world-leading digital infrastructure, strong intellectual property enforcement, and generous Free Economic Zone (FEZ) tax exemptions, South Korea is a premier technology and advanced industrial hub.

13th largest economy

Low 9% initial tax bracket

KRW 100M D-8 investor visa

93 tax treaties

Advanced tech leader

Why Choose South Korea

World's 13th largest economy — home to Samsung, Hyundai, LG, and SK

Low initial corporate tax rate: 9% on first KRW 200M of taxable profit

100% foreign ownership allowed across virtually all industries

Free Economic Zones (FEZs) with local tax exemptions and cash grants

World-leading digital and 5G telecommunication infrastructure

Strong protection of intellectual property, trademarks, and patents

D-8 Corporate Investment Visa pathway for founders and managers

93 comprehensive double taxation avoidance agreements

Business Entity Types

Entity	Ownership	Directors	Capital	Tax	Best For
Chushik Hoesa (Stock Corporation)	100%	1 (3 if capital ≥ KRW 1B)	KRW 100 (KRW 100M for foreign investment recognition)	9% on first KRW 200M; 19% up to KRW 20B; 21% up to KRW 300B; 24% max	Standard corporate vehicle, venture capital fundraising, IPO candidates
Yuhan Hoesa (Limited Liability Company)	100%	1 director	KRW 100	Same progressive rates as Chushik Hoesa	Foreign corporate subsidiaries, private holdings, technology studios
Branch Office (Eupso)	100%	1 branch representative in Korea	None	Taxed on Korean-sourced net profits + branch tax if applicable	Direct operating extensions of foreign commercial enterprises
Liaison Office (Samuso)	100%	1 representative	None	Non-taxable (no commercial sales permitted)	Market research, liaison, advertising, non-revenue operations

Step-by-Step Formation Process

FDI Notification

1–2 days

Report Foreign Direct Investment to KOTRA (Invest Korea) or an authorized foreign exchange bank.

Capital Remittance

2–5 days

Remit investment funds into a temporary escrow account at a Korean foreign exchange bank.

Court Registry Incorporation

3–5 business days

Tax Registration

3–5 days

Obtain Business Registration Certificate (Saupja Deungrokjeung) from the competent district tax office.

FDI Company Registration & D-8 Visa

2–4 weeks

Costs & Fees

Government / License Fee	KRW 500,000+
Our Service Fee	USD 3,500+
Annual Renewal	USD 2,200+

Fees are indicative and may vary based on business activity, entity type, and additional approvals required. Contact us for a precise custom quote.

Get Custom Quote

Banking

South Korea's commercial banking sector is modern and technologically sophisticated. Major commercial banks (Shinhan, Hana, Woori, KB Kookmin) have dedicated foreign investment desks with English-speaking specialists.

Account Opening Time

1–2 weeks

Multi-Currency

Yes — multiple currencies supported

Recommended Banks

Shinhan BankHana BankKB Kookmin BankWoori BankStandard Chartered KoreaCitibank Korea

Tax Overview

Corporate Tax

9% (first KRW 200M); 19% (KRW 200M–20B); 21% (KRW 20B–300B); 24% (>KRW 300B) + 10% local income surtax

Personal Income Tax

6% to 45% progressive; flat 19% tax rate option available for foreign employees

VAT / Sales Tax

10% standard VAT rate

Capital Gains Tax

Included in general corporate taxable income; 10% or 20% withholding for non-residents

Withholding Tax

Dividends: 20% (reduced by tax treaties); Interest: 20% (14% on bonds); Royalties: 20%

Double Tax Treaties

93 countries

Special Tax Treatment Control Law provides R&D tax credits up to 25–40% for national strategic technologies (semiconductors, secondary batteries, AI).

Visa & Residency

D-8 Corporate Investment Visa

1 to 5 years, renewable

For executives/investors who inject KRW 100M+ under Foreign Investment Promotion Act

D-9 Trade Management Visa

1 to 2 years, renewable

For international trade specialists establishing import/export businesses

F-5 Permanent Residence

Permanent

Pathway available for substantial foreign investors and high-tech founders

Family visa: AvailableProcessing: 3–6 weeks

Frequently Asked Questions

What is the minimum capital required to set up a Korean company?

Under Korean commercial law, the statutory minimum capital is just KRW 100. However, to qualify as Foreign Direct Investment (FDI) under the Foreign Investment Promotion Act and obtain a D-8 investor visa, the foreign investor must invest at least KRW 100 million (~USD 75,000) and hold at least 10% of the voting shares.

What is the difference between Chushik Hoesa and Yuhan Hoesa?

Chushik Hoesa is a stock corporation (similar to a US C-Corp or German AG) which can issue shares, bonds, and go public on the KRX. Yuhan Hoesa is a private limited liability company (similar to a LLC or GmbH) with fewer disclosure obligations, no requirement to publish annual balance sheets in official gazettes, and simpler board governance. Most foreign subsidiaries choose Yuhan Hoesa unless planning an IPO.

Do I need a Korean-resident director to incorporate?

No. Korean corporate law does not require any director or shareholder to be a South Korean citizen or resident. The entire board can consist of foreign nationals residing abroad.