Tax deduction of only one kind can received; thus, a decision has to be made about which deduction to receive. 

Since the confirmation has no legal effect, it is necessary to submit a written application and get the approval for tax deduction. 

Yes. The application needs to be submitted separately at the Ministry of Finance and Economy. 

In order to receive duty exemption for the capital goods introduced by a foreign invested company, they should be introduced as a means of foreign or domestic payment. Therefore, it is not considerable that when to be made Purchase order, but it is important that when the imported capital goods’ payment is made and by which fund.
If the payment is made by the increase capital that is increased after P/O issue, they are not introduced as a means of foreign or domestic payment under the Special Tax Treatment Control Act, so customs duties are not exempted.
Therefore, a foreign bank that issues confirmation of the declaration of capital goods import for application of customs duty exemption has to confirm the day when the payment for capital good is made and the day when the increase capital is paid, and an application for the confirmation of the declaration of capital goods import should be maid after increase capital is paid. 

Generally, responsible person for tax payment is the person who imports the items completed import notification and in case of a firm, a firm registered in the certificate of business registration is the obligator to pay the duty. Thus, the foreign invested company established with investment in kind, can be the obligator to pay the duty.
In principle, the certificate of business registration is issued after business establishment (for a corporation). However, if the foreign-invested company makes only investment in kind, the certificate of business registration may be issued before business establishment, and can be used at import clearance. The certificate of business registration has to be obtained before import clearance and then import notification has to be made, in order to receive exemption later on from the value-added tax paid during import clearance. 

• FDI through a long-term loan refers to a company issuing a loan with a maturity of at least 5 years to a foreign-invested company from its overseas parent company or a company, which has capital affiliation with the said parent company.
• The foreign investor or the proxy goes to any domestic bank or branch, branch of any foreign bank, Invest KOREA or any KOTRA office in Korea or overseas for notification.
• Documents to be submitted are as follows:

– Application form for FDI through long-term loan;
– Proof that the company is the overseas parent company or a company affiliated with the parent company;
– Copy of loan contract;
– Certificate of nationality of the foreign investor. 

♦ Tax reduction or exemption on corporate tax, income tax, acquisition tax, registration tax,
property tax and aggregate land tax may be granted to foreign investments, which are vital
for strengthening the international competitiveness of domestic industries and in accordance
with the Restriction of Special Taxation Act (Art. 9 of FIPA)

♦ High-technology Business
– Technology, that is of a low level or not developed at all in Korea, having substantial
economic and technological benefits for the national economy such as:

• Manufacturing and designing computers (above 64Bits);
• Manufacturing of computer memories, input-output devices, other appliances and parts;
• Manufacturing of broadcast and wireless communication devices and their core parts;
• Manufacturing of semiconductor devices, material and equipment and their parts.

♦ Industry-supporting Service Business
– Service businesses of high value-added, supporting the development of other industries
such as manufacturing and which are essential for the strengthening of the international
competitiveness of the nation’s industries such as:

• Information processing and computer management technology
• Software development and production technology
• Automated management system technology-using computers
• E-commerce-related technology

If a domestic company becomes a foreign-invested company through foreign investment it is not regarded as capital increase but new foreign investment.

Accordingly, the company has to apply for tax deduction by Dec. 31, 2004.

According to relevant laws, if a company is operating both, two business sectors eligible as well as not eligible for tax deduction, then the accounting has to be done separately.

According to Art. 121 of the Special Tax Treatment Control Law, the day of reckoning would be the day when the change about the capital increase was registered.