- VAT in Korea is a 10% tax on added value, generally filed quarterly, and was introduced in 1977 to simplify indirect taxes and stabilize revenue.
- It follows the destination principle: tax is levied where goods or services are consumed, not produced, to avoid double taxation across countries.
- Exports and overseas services are taxed at 0% (zero-rated), which is why exporters can get VAT refunds for input tax paid during production.
- Some export-related transactions also qualify for the zero rate, including certain foreign-currency-earning services and content supplied to overseas platforms like YouTube or TikTok.
- Zero-rate eligibility depends on transaction type; for some services, payment must be received in foreign currency through a foreign exchange bank, so creators using payment services should secure proper foreign-currency documentation.
Source: en.sedaily.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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