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2015.07.21
Kim, Jun Hyo. CTA
Ⅰ. Outline
Thereare many methods in that foreign corporation send domestic corporationsample(related IT product) etc.
Firstis passing through customs with paying or free of charge.
Secondis hand-carry with paying or free of charge.
Ⅱ. Delivery methods and accounting management.
1. Delivery methods
(1) Aformal importing(ordinary transaction)
Importingwith statement of accounts from customs by licensed customs agent(certificateof import declaration) by licensed customs agent. There are free of charge orpaying.
(2)Hand-Carry importing (urgent transaction)
1) Taking customs procedure after bring ingoods by hand-carry (free of charge or paying).
2) Bring in goods with undeclared certification(free of charge or paying).
2.Accounting Mangement
1)Bring in goods with paying and sales at a cost.
Purchasing :
debit side) Product xxx credit side) accounts payable xxx
Sales :
debit side) cost of goods sold xxx credit side) product xxx
debitside) credit account xxx credit side )revenue of products xxx
2) Bring in goods with free ofcharge and sales free
Purchasing : no accountingmanagement
Sales : no accountingmanagement
Ⅲ. Main Issue
Q. Samples provided from foreign company were imported without foreignexchange and the samples were provided to domestic company. Is the input tax intax invoice deductible?
A. If the sample imported from foreign company for value added taxbusiness and it was no draft import paying customs value added tax issued taxinvoice by customs director the input tax is deductible.
Q. If it is hand-carry delivery case, is there any problem for unimplementof customs procedure?
A. Hand-Carry case : If it is under KRW 2,000,000 there are few problem inunimplemented procedure but if the amount is over KRW 2,000,000 there isproblem. There is possibility to bring up a problem during investigation fromKorea Customs Service. Therefore reporting such as simplified clearance shouldbe implemented.
Ⅳ. Related Law
Article17(PayableTaxAmount)
(1)The amount of value-added taxes payable by an entrepreneur(hereinafter referred to as a“payable tax amount”) shall be the amount com-puted by deducting the tax amount under thefollowing subparagraphs(hereinafter referred to as an“inputtaxamount”) from the tax amount on the goods or service ssupplied by the entrepreneur
(hereinafter referred to as “output tax amount”): Provided, that where an input tax amount exceeds the output tax amount,it shall be a refundable tax amount(hereinafter referred to as a“refundable tax amount”):
<AmendedbyActNo.9915,Jan.1,2010>
1.The tax amount on the supply of goods or services either used or to be usedfor his/her own business;
2.The tax amount on the import of goods either used or to be used for his/herown business.
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