A domestic company with one billion won capital and a capital increase of one billion won has issued new stocks of one billion won with 100% extra stocks to a foreign investor. Thus, the amount of foreign investment became 2 billion won.

When issuing new stocks, the amount of foreign investment is the total amount of initial capital and capital increase. However, the rate of foreign investment is calculated based on the rate of capital.
– In this case, the rate of foreign investment would be as follows: KRW1 billion /
(KRW1 billion + KRW1 billion) = 50%
<capital increase> <initial capital> <capital increase> <rate of FDI>

Furthermore, when speaking of tax deductions of 100% or 50%, this figure refers to the rate of foreign investment and not the amount of foreign investment. That is, the tax deductions are given 100% or 50% to the rate of foreign investment.

– In this case, if the foreign investment were eligible for 100% tax deduction, the amount
of deduction would be 100% of the 50% rate of FDI, which is a deduction of 50%.