S Korean Companies Unprepared For BEPS: Survey
The Federation of Korean Industries (FKI) has disclosed that 81 percent of respondents to a survey of South Korean companies professed that, although they were aware of the OECD’s base erosion and profit shifting (BEPS) project, they were not, as yet, making any preparations.
The South Korean Government is preparing revised regulations so that companies with an annual revenue of more than KRW100bn (USD86m) and more than KRW50bn in international related party transactions will have to provide additional information, including transfer pricing files. A country-by-country report of income and taxes paid will be required from multinational companies with annual consolidated revenues of KRW1 trillion.
The additional information will be required to be provided to the National Tax Service at the same time as a company’s corporate tax return for its financial year commencing on or after January 1, 2016.
The survey also showed that about 50 percent of its respondents said that they would be making BEPS preparations in the future, and only 20 percent confirmed that they were already consulting external experts with regard to BEPS.
An FKI spokesperson commented that “the BEPS project will increase the compliance burden on South Korean companies. … [It] is an international cooperation project, and our multinational companies need to take a more aggressive response.”
