However, the refundable VAT items are those related to the purchase of the following goods and services:
(i) foods and lodging
(ii) advertisement
(iii) electricity and telecommunication
(iv) office lease
(v) purchase of building and structures for a liaison office
(vi) repair of building and structures
(vii) purchase or lease of office furniture and supplies
Any VAT payment relating to legal and accounting services, purchase of office car and entertainment expenses are not claimable for refunds by the liaison offices.
The Regional Tax Office reviews the tax return and decides the tax refund by December every year. The VAT refund rule shall be applied on a reciprocal basis between Korea and other foreign country. When the tax law of its head office in a foreign country does not provide VAT refunds to Korean liaison offices located in the foreign country, the tax authority in Korea would not refund to the Korea liaison office under this reciprocity principle.