Article 63-2 (Tax Reduction and Exemption for Corporations Moving Headquarters Outside the Seoul Metropolitan Area)

A corporation that meets all the requirements of subparagraphs of Item 1 and commences business by December 31, 2028 (or December 31, 2031, if the headquarters is newly constructed and the land for the headquarters is held by December 31, 2028, and a relocation plan is submitted when filing the tax return for the taxable year that includes December 31, 2028) (hereinafter referred to as "headquarters-relocated corporation" in this Article) shall be granted corporate tax reduction and exemption for the income subject to reduction and exemption under Item 2, in accordance with the classification in Item 3. However, this shall not apply to corporations engaged in real estate business, construction business, consumption service business, mail-order sales business, and shipping brokerage business as prescribed by a Presidential Decree. <Amended by Act No. 17837, Dec. 28, 2021; Act No. 18581, Dec. 31, 2022; Act No. 19791, Dec. 31, 2024; Act No. 20066, Dec. 23, 2025> 1. Requirements for Tax Reduction and Exemption a. The corporation shall have had its headquarters located in the Seoul Metropolitan Overcrowding Control Zone for at least three consecutive years. However, corporations that have received reduction and exemption under this Article within 10 years prior to the start of the taxable year that includes the date of registration of headquarters relocation shall be excluded. b. The headquarters shall be relocated outside the Seoul Metropolitan Area as prescribed by a Presidential Decree. c. The investment amount in the relocated headquarters outside the Seoul Metropolitan Area (hereinafter referred to as "relocated headquarters" in this Article) and the number of employees at the relocated headquarters shall meet the standards prescribed by a Presidential Decree, taking into account their impact on the regional economy. 2. Income Subject to Reduction and Exemption: An amount equivalent to the amount calculated by multiplying the amount in sub-item a by the ratio in sub-item b and the ratio in sub-item c. a. The amount remaining after deducting capital gains from the transfer of land, buildings, and rights to acquire real estate, and income prescribed by a Presidential Decree, from the tax base for the relevant taxable year. b. The ratio of employees at the relocated headquarters to the total employees of the corporation for the relevant taxable year. c. The ratio of total sales, excluding sales from consignment processing trade prescribed by a Presidential Decree, to the total sales for the relevant taxable year. 3. Reduction and Exemption Period and Amount of Tax Reduction and Exemption a. For taxable years ending within the period specified below, from the beginning of the first taxable year in which income is generated after the headquarters relocation date (or the taxable year that includes the date five years after the headquarters relocation date if no income is generated within five years from the headquarters relocation date): An amount equivalent to 100 percent of the corporate tax on the income subject to reduction and exemption. 1) Cases where relocation is to an area outside the Seoul Metropolitan Area as specified in Article 63 (1) 2 a) 1): 5 years 2) Cases where relocation is to an area specified in Article 63 (1) 2 a) 2) a) When relocating to a growth promotion area, etc.: 7 years b) When relocating to an area other than those specified in a): 5 years 3) Cases where relocation is to an area specified in Article 63 (1) 2 a) 3) a) When relocating to a growth promotion area, etc.: 10 years b) When relocating to an area other than those specified in a): 5 years 4) Cases where relocation is to an area outside the Seoul Metropolitan Area other than those specified in 1) through 3) a) When relocating to a growth promotion area, etc.: 10 years b) When relocating to an area other than those specified in a): 7 years b. For taxable years ending within the three years following the taxable years specified in sub-item a [four years in cases falling under sub-item a 2) a) or 4) b), five years in cases falling under sub-item a 3) a) or 4) a)]: An amount equivalent to 50 percent of the corporate tax on the income subject to reduction and exemption.

When paying the corporate tax reduced and exempted under paragraph (1) pursuant to paragraph (2), the provisions regarding interest equivalent surcharges in Article 63 (3) shall be applied mutatis mutandis.

Headquarters-relocated corporations intending to apply paragraphs (1) and (4) shall have the same business activities at the relocated headquarters as those conducted at the headquarters prior to relocation for at least two years prior to the date of registration of headquarters relocation, based on the classification prescribed by a Presidential Decree. <Amended by Act No. 20066, Dec. 23, 2025>

The total amount of corporate tax reduced and exempted during the reduction and exemption period applicable under paragraph (1) shall be limited to the sum of the amounts in Items 1 and 2 (hereinafter referred to as "reduction and exemption limit" in this Article). <Newly Added by Act No. 20066, Dec. 23, 2025> 1. 70 percent of the cumulative investment amount prescribed by a Presidential Decree. 2. Number of regular employees at the relocated headquarters (including the relocated factory when the factory and headquarters are relocated together. Hereinafter the same applies in this Article) for the relevant taxable year × 15 million won [20 million won for headquarters-relocated corporations engaged in a service business prescribed by a Presidential Decree (hereinafter referred to as "service business subject to reduction and exemption" in this Article) and for regular employees who are young people].

If the number of regular employees at the relocated headquarters in each taxable year during the period ending on the last day of the taxable year two years after the end of the taxable year in which tax was reduced and exempted under Item 7 (2) has decreased compared to the number of regular employees in the taxable year in which tax was reduced and exempted, the amount equivalent to the tax reduced and exempted shall be paid as corporate tax, according to a Presidential Decree. <Newly Added by Act No. 20066, Dec. 23, 2025>

When applying paragraphs (1) through (10), the calculation method for investment amounts, number of employees, and periods, application for tax reduction and exemption, scope of regular employees and young regular employees, calculation method for the number of regular employees, and other necessary matters shall be prescribed by a Presidential Decree. <Amended by Act No. 17837, Dec. 28, 2021; Act No. 20066, Dec. 23, 2025>