Accounting firms under fire for encouraging corporate tax refund claims

Accounting firms under fire for encouraging corporate tax refund claims

최초입력 2025.04.24 10:58:30

(Yonhap)

South Korea’s National Tax Service (NTS) is on high alert as a growing number of Korean companies operating in Vietnam are filing refund claims, encouraged by domestic accounting firms which are essentially engaging in “refund marketing” under the guise of advisory services.
According to sources from the business circle on Wednesday, the Tax Tribunal will hold its first deliberation meeting on Hansae Co.’s claim for a partial corporate tax refund on April 29th, 2025.
Hansae is a leading original equipment manufacturer (OEM) of apparel with three production plants and one fabric processing facility in Vietnam. The company filed a claim requesting a refund of 50 billion won ($35.03 million) in corporate tax, arguing that it had increased the transfer price of products imported from its Vietnam factories to its Korean headquarters. This adjustment, according to the company, reduced the profits of the headquarters and thus warranted a refund.
A transfer price is the accounting price applied to transactions of raw materials, goods, or services between related entities. When the transfer price is raised, it increases expenses for a company’s headquarters, reducing its taxable income and leading to a potential tax refund.
The NTS has been closely monitoring similar claims among companies operating in Southeast Asia, including Vietnam and Indonesia. More than ten companies with manufacturing facilities in Vietnam have submitted corporate tax refund claims, including Shinsung Tongsang Co. (known for brands such as TOPTEN10, OLZEN, and ZIOZIA), Sungwoo Hitech Co., Dae Won Kang Up Co., Yakjin Trading Corp., JS Corp., and Namyang.
Shinsung Tongsang filed for a refund of around 18 billion won, Sungwoo Hitech for 40 billion won, and Dae Won Kang Up for 11 billion won, according to sources. These refund filings are being handled by major Korean accounting firms such as Samil PWC, Shinhan Accounting Corp., and Samhwa Accounting Corp.
“Accounting firms are encouraging mid-sized companies in Vietnam to file for corporate tax refunds,” a tax attorney said. “If a refund is granted, the firms typically take 20 percent of the refunded amount as commission.”
The number of corporate tax refund claims surged from 24,945 in 2022 to 43,932 in 2023.
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Accounting firms under fire for encouraging corporate tax refund claims

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