Corporate R&D Center Tax Credit in Korea — 2026 Guide

1. R&D Tax Credit Overview

Companies with an IITP-recognized corporate research lab can claim income tax credits on qualifying R&D expenses under the Tax Special Cases Control Act.

2. Credit Rates

• SMEs: 25% of qualifying R&D expense amount
• Mid-sized companies: 8–15% depending on method
• Large companies: 0–2% (incremental method primarily)

3. Eligible R&D Expenses

• Researcher salaries and benefits
• Materials and consumables used directly in research
• Depreciation of R&D-dedicated equipment
• Contract research fees paid to universities or certified institutes

4. Non-Eligible Expenses

• General administrative costs
• Marketing and sales expenses
• Equipment not exclusively used for R&D

5. How to Claim

1. Maintain quarterly R&D expense records segregated from general accounts
2. Prepare R&D expense statement for the tax year
3. Include the credit in the annual corporate income tax return
4. Attach IITP recognition certificate as supporting document

6. Audit Preparation

• Keep all research documentation: lab notebooks, test reports, researcher time records
• Ensure facility and personnel match what was declared to IITP
• Separate R&D bank account is recommended for clarity