Strengthened exit tax
9/27/2018
Currently the exit tax is applied by 20% of deemed capital gain to a major shareholder of a domestic corporation who moves from Korea to a foreign country for a reason of immigration, etc.
To prevent overseas tax evasion and secure the right to taxation on domestic property, the exit tax will be newly applied to a major shareholder of a corporation holding excessive real estate assets where 50% or more of its assets is composed of real estate (80% for golf course or ski resort company). In addition, the progressive tax rate scheme will be introduced at 20% on the tax base of KRW 300 million or less and 25% on the tax base exceeding KRW 300 million.
To improve the effectiveness of the exit tax, a penalty will be newly imposed by 2% on face value of the shares which are non-reported or under-reported. Any major shareholder subject to exit tax shall report the details of shareholding as of one day before the filing due date which is one day before departure.
Above revisions will be applied to the immigrants from Korea to foreign country on or after January 1, 2019.
To prevent overseas tax evasion and secure the right to taxation on domestic property, the exit tax will be newly applied to a major shareholder of a corporation holding excessive real estate assets where 50% or more of its assets is composed of real estate (80% for golf course or ski resort company). In addition, the progressive tax rate scheme will be introduced at 20% on the tax base of KRW 300 million or less and 25% on the tax base exceeding KRW 300 million.
To improve the effectiveness of the exit tax, a penalty will be newly imposed by 2% on face value of the shares which are non-reported or under-reported. Any major shareholder subject to exit tax shall report the details of shareholding as of one day before the filing due date which is one day before departure.
Above revisions will be applied to the immigrants from Korea to foreign country on or after January 1, 2019.