01. Overview

In Korea, if the company report, set up and accept the corporate R & D centre by Korean Government
or the Research Division in charge, Korean Government will give various tax benefits and financial support to induce
the national-wide R&D investment. At the same time the company will increase to support it and it'll promote the
basic technology quite positively. Finally company will increase the employment of the science of technology in the future.

02. Legal Basis

(1) Corporate R& D Center
- Act for the basic Research improvement & technology development support
   (Hereinafter “Act”) Article 14-①-2
(2) The Research Division in charge :
- Decrees of Act Article 16-①

03. Set-up procedures of the Corporate R & D center

(1) Newly Set-up report is possible to register the on-line website via the Public Key Certificate
(2) If necessary to submit the supplementary documents, must be submitted it within 7(seven) days.
      If failed it, the application will be rejected automatically.
(3) In case Newly Set-up report is properly filed and accepted by government,
      it'll be issued the certificate/confirmation letter within 7 days after the filing.
(4) The requests of the revision can be identified in the e-mail or R&D management website

04. Major Tax benefits and Incentive

(1) Inclusion of expenses for the reserve of the R & D cost (Restriction of Special Taxation Act Article 9.)
     -The future investment amount which will spend for the research and human development
     (R&D Cost, Technology Information and training cost, Research facility investment, etc)
     can be reserved the deductible cost before the investment and then it'll be spent the R&D cost within next 3(three) years
(2) Tax Credit for Research and HR development(Restriction of Special Taxation Act Article 10.)
     - In the Research and HR development spending each year, if the R&D cost for acquiring of a new growth engine industry or
       source technology is proved, 20 % (Small-medium company 30 % ) of R & D cost in this year will be deducted the tax credit.
     - However if the cost is not applicable of the above or not choose, it's possible to get the tax credit for the Research and HR
       development in a certain range of corporate income tax and personal income tax.
        1) Small-medium company(choice 1)
             a) this year's actual cost x 25 %
             b) this year's actual cost – the average of last 4 year's cost x 50 %
        2) Large Company (choice 1)
             a) this year's actual cost x 3 ~ 6 %
             b) this year's actual cost – the average of last 4 year's cost x 40 %
(3) Research & HR development facility investment tax credit (Restriction of Special Taxation Act Article 11.)
     - If local company invest the facility for HR development or the commercial operation of new technology until Dec. 31st 2015, company
     will get the tax credit 3 % (medium-size company : 5 %, Small-size company : 10 % ) of their investment amount in their corporate income tax return.
(4) Researcher's R&D activity cost for Small & Medium-size or Venture company (Presidential Decrees of personal Income Tax Act 12)
     - Researcher's R&D activity allowance will be non-taxable income within KRW 300,000 if they engage the Researcher's R&D activities in the Small & Medium-size or Venture company
(5) The acquisition of real estate which will directly used for the R&D center can be exempted the Local Income Tax.(Restriction of Local Special Taxation Act Article 46.)
     - If the real estate purchases to directly use for the R&D center, the acquisition tax will be exempted by 50 %(Small company : 75%), property tax50 % (Small company : 75%) each.

For more information, please contact us in Gangnam Center. Thank you.