Additional 2601-1551 (Law Firm 1986.07.30)

Addition

Where a foreign corporation which has no place of business in the Republic of Korea enters into a technology introduction contract with a foreign corporation which has no place of business in the Republic of Korea and provides technical services stipulated in a contract from a technician belonging to such foreign corporation and pays the technical standby fees and the daily allowances

1. In case of re-quality, the payment of the price-added tax shall be made by collecting and paying by proxy the price for the technical service in accordance with Article 34 of the Value-Added Tax Act when considering that the technical service cost is included in the price for the technology service in question and paying a daily allowance to the technician who belongs to the foreign corporation concerned, after concluding a technology introduction contract with the foreign corporation having no place of business in Korea. (2) The daily allowance and the system cost to be paid by the technician dispatched under a contract with the foreign corporation falls under the earned income of the non-resident provided for in subparagraph 7 of Article 134 of the Income Tax Act at the same time constituting a part of the income, or the income of the foreigner dispatched under the technology introduction contract provided for in the Foreign Capital Inducement Act;

Article 34 of the Value-Added Tax Act