Starting a business in
🇰🇷South Korea
Checked November 4, 2026 · How we score
Corporate tax
25%
Top income tax
45%
Setup from
$3,000
all-in, first year
Time to form
4 weeks
visit usually needed
Taxes in South Korea
| Corporate income tax | 25% Progressive national rates from 1 January 2026 (fiscal years starting on or after that date): 10% up to KRW 200m, 20% to KRW 20bn, 22% from KRW 20bn to 300bn and 25% above KRW 300bn, each one percentage point higher than the 2025 rates (9/19/21/24%). A 10% local income surtax is added, so most SMEs pay 11% to 22%. A 15% top-up tax regime applies to large multinational groups. A pending bill may lower the bottom bracket for small companies, so confirm with the National Tax Service. |
|---|---|
| Personal income tax (top) | 45% Progressive national rates from 6% to 45% (45% above KRW 1bn), plus a 10% local income surtax for a top combined rate of 49.5%. Residents are taxed on worldwide income; foreign nationals resident under 5 years in the last 10 are taxed on Korean-source income and on foreign income paid in or remitted to Korea. |
| Tax system | Worldwide income |
| Capital gains tax | 22%Listed share gains are exempt for most small investors, and the planned financial investment income tax was abolished. Major shareholders and unlisted share transfers pay 20% (22% with local tax), 25% on gains above KRW 300m. Real estate gains are taxed at 6-45% (more for multiple properties). |
| Dividend withholding (non-residents) | 22% |
| VAT / GST | 10% |
| Social security | Four major social insurances apply; the employer cost is roughly 10-11% of salary and the employee share is about 9%. Foreigners are covered by the national pension unless a social security agreement or reciprocity exempts them. |
Forming a company in South Korea
| Usual entity | Chusik Hoesa (stock company) or Yuhan Hoesa (LLC) |
|---|---|
| Minimum capital | None |
| Setup cost (all-in) | $3,000–$8,000 |
| Annual running cost | $4,000–$9,000 |
| Time to incorporate | 4 weeks |
| Form remotely as a foreigner | No |
| Local director required | No |
| Local address required | Yes |
| Owners on public register | No |
| Statutory audit for small companies | No |
| Business banking for non-residents | Hard |
Residency and visas
The Workation (F-1-D) visa launched in January 2024 for remote workers with at least about KRW 85 million (twice Korean GNI per capita) of annual income, valid for up to 2 years with a 1-year initial period. Entrepreneurs use the D-8 corporate investment visa (about KRW 100 million investment) or the D-10-T technology start-up route. The F-2 residency can be earned through investment of at least KRW 500m in designated real estate, which is the closest thing to a golden visa.
| Digital nomad visa | Workation Visa (F-1-D), $5,100/month income |
|---|---|
| Golden visa | Yes, from $360k |
| Ease of residency for founders | 3/5 (1 = easiest) |
Special tax regimes
Workation Visa (F-1-D)
Two-year visa for foreign remote workers earning at least about KRW 85 million, for people employed by a foreign company, with spouse and children allowed.
D-8 Corporate Investment visa
For foreign investors who establish a Korean company with at least KRW 100 million in capital and a management role.
Real-estate investment residency (F-2)
Residency for investments of KRW 500 million or more in designated resort or complex properties.
Tax relief for foreign investment and tech start-ups
Foreign-invested companies in advanced technology fields can receive a corporate tax holiday for up to 7 years (100% for 5 years, then 50% for 2 years), subject to approval.
Pros and cons
Why founders pick South Korea
- Advanced digital infrastructure and a large domestic market
- Tax holidays for qualifying foreign-invested tech companies
- Workation visa for remote workers
- Strong IP protection and credibility
Watch out for
- High personal tax rates, up to 49.5% with local tax
- Complicated visa and corporate investment procedures
- Foreign exchange reporting and strict bank KYC
- Language barrier and heavy paperwork for non-residents
Best for: Tech, gaming and consumer-hardware companies serving Korea · Foreign-invested advanced-technology firms using tax holidays · Founders who want proximity to Korean supply chains and customers
South Korea: common questions
What is the corporate tax rate in South Korea?
For fiscal years beginning in 2026 the national rates are 10% up to KRW 200 million, 20% to KRW 20 billion, 22% to KRW 300 billion and 25% above, plus a 10% local surtax. A bill to reduce the lowest band is pending, so check the National Tax Service for the final rates.
Does South Korea have a digital nomad visa?
Yes. The Workation visa (F-1-D) launched in January 2024 for remote workers with annual income of about KRW 85 million and at least one year of work experience in the field. It lasts up to two years and allows the family to join.
How much investment is needed for a D-8 visa in South Korea?
The D-8 corporate investment visa generally requires at least KRW 100 million (about $72,000) of foreign investment in a Korean company, with the investor holding a management role. Requirements can be adjusted by the Ministry of Justice.
Does Korea tax foreign income?
Korean residents are taxed on worldwide income. Foreigners resident for five years or less in the last ten years are taxed only on Korean-source income plus foreign income paid in or remitted to Korea.
Can a foreigner own 100% of a Korean company?
Yes, in most sectors a foreigner can own 100% of a Korean company after a foreign investment report, though some industries such as broadcasting and telecoms have limits. Establishing the company, opening the bank account and registering the investment typically needs in-person visits or a local lawyer.
Sources
- National Tax Service (Korea)
- Korea Immigration Service - HiKorea
- PwC Tax Summaries - Korea, Republic of
Similar countries
Not tax or legal advice. Rates and rules change; we check official sources and update every page, but verify with a licensed adviser in the country before acting. Spotted something out of date? Use the correction form below.