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Duty Refund

★Swift and Accurate Customs Refunds—Partner with K&K.

★With K&K's deep expertise and extensive experience, we ensure you recover your valuable customs duties efficiently and effectively.

What is customs duty refund?

If imported raw materials are used for export or as raw materials for earning foreign currency, the customs duties paid at the time of importation are refunded to the exporter or producer upon request.

Execution Period and Application Period

Customs refunds must be applied for within 5 years from the date the goods were provided for export, and customs duties and other fees on imported raw materials for export will be refunded if the application is made within 2 years (the export execution period) from the last day of the date the goods were provided for export.

Method of Refund

Refund Methods are divided into individual refunds that require proof of the tax amount paid and simplified fixed refunds that do not require proof of the tax amount but allow customs duties to be refunded through a simple procedure.

Individual Refund	Simplified Fixed Refund
- Refund of paid customs duties, etc., on the quantity of raw materials used in the production of export goods. - Submission documents: Export Fact Confirmation Document, Proof of Tax Payment Document, Usage Calculation Sheet, Terms, and Additional Material Statements.	- Refund according to the simplified fixed refund rate table, which specifies a fixed amount per 10,000 KRW of export value. - Submission documents: Export Fact Confirmation Document, Small and Medium Enterprise Confirmation Document, Factory Registration Certificate.

Simplified Fixed Refunds: To qualify, the company must be a small or medium-sized enterprise as defined by Article 2 of the Basic Act on Small and Medium Enterprises and meet the following condition:
- The total refund amount, including the issuance of preliminary certificates, should not exceed 800 million KRW in the year of the refund application or in each of the two preceding years.

Simplified fixed refunds allow companies to apply for a refund without proving the tax paid during the raw material importation stage or calculating the usage amount.

Individual Refunds: This method involves calculating the tax amount paid on the imported raw materials used in the manufacturing of export goods and refunding that amount. The advantage of individual refunds is that the refund amount is accurate since it is calculated based on the type and quantity ("usage amount") of raw materials used in the manufacturing of export goods. However, the downside is that calculating the usage amount is more complex compared to simplified fixed refunds.

Procedure

Import of raw materials
Existence of paid taxes on raw materials imported from abroad
Manufacturing of export goods
Imported raw materials are physically and chemically combined with export goods
Calculation of required quantity
Arbitrary selection of one of the 6 methods
Refund Application
Refund application must be made within 5 years from the date of provision for export, etc.
Payment of refund
Transfer to the refund applicant's account
Post verification audit
Audit of accuracy after refund payment

Key Services of K&K

• Application for Individual Refund • Application for Simplified Fixed Amount Refund • Application for Tax Payment Certificate of Basic Raw Materials • Application for Split Certificate • Representation for Pre-Review of Usage Quantity • Management and Review of Usage Quantity by Item • Response to Customs Refund Audit • Educational Services Related to Customs Refunds