SOUTH KOREA Law and Practice Contributed by: Hyeon Kang, Tae Kyoon Kim, Seungil Hong and Sung-Ho Moon, Bae, Kim & Lee LLC
8.5 Tax Benefits A domestic corporate entity owning real estate (as opposed to leasing real estate) may rec - ognise depreciation of the building as an eco - nomic loss of such corporate entity, within the limits prescribed in the Corporate Tax Act. There appear to be no other tax benefits that can be gained from owning real estate.
The foreign corporate entity receiving income from the transfer of real estate must also com - plete an income tax filing, but the amount with - held as income tax by the transferee is credit - able. The applicable tax rate is the same as it is for real estate rental income (9.9% to 26.4%). There are no special exemptions for real estate transfer taxes, and tax treaties joined by Korea generally prescribe that real estate rental income and real estate transfer income are taxable in Korea, the location of the income source.
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