Starting a business in Korea as a foreigner

First: do you need a visa for this?

Not necessarily. What you need depends on your current status.

This is worth establishing before anything else. If you already hold an F-visa, most of the visa complexity below does not apply to you and you can simply register a business like any Korean resident.

The D-8 route

D-8 is granted to a foreign national who invests in and manages a Korean company with foreign investment. The threshold is ₩100 million for a single investor in the standard category — but three characteristics of that money matter more than the amount.

It must come from abroad

Funds already sitting in a Korean bank account do not qualify. The capital has to be remitted into Korea from overseas and documented as foreign investment. Money you earned in Korea and saved here is, for this purpose, the wrong money.

It must be notified before it arrives

The foreign investment notification is filed at a designated foreign exchange bank or through KOTRA before the funds are remitted. Doing it the other way round is the single most common and most expensive mistake in this whole process.

It must be genuinely invested

The capital goes into the company and is expected to be spent operating the business. Parking it and withdrawing it after the visa is granted is exactly what renewals look for.

The sequence

1. File the foreign investment notification. At a designated foreign exchange bank or KOTRA. Before the money moves.
2. Remit the capital to a Korean account, obtaining the certificate of foreign currency purchase.
3. Incorporate. Corporate registration at the court registry, then business registration (사업자등록) at the tax office.
4. Obtain the foreign-invested company registration certificate.
5. Apply for D-8 — a change of status at your regional immigration office if you are in Korea, or a visa issuance confirmation if applying from abroad.

Steps 1 to 4 are usually handled by an administrative scrivener (행정사) or a law firm. The fee is modest relative to the cost of getting the order wrong, and this is not an area to economise.

Choosing a company form

The office requirement

You need a real, independently leased office with a lease in the company's name. Virtual offices, co-working hot desks and residential addresses are almost always rejected, and immigration officers do visit.

A dedicated private office within a serviced-office building is generally acceptable. A shared desk in an open-plan space is not. Budget for this from the start — it is a fixed cost that many first-time founders fail to plan for.

What happens after incorporation

Running a Korean company involves ongoing obligations that carry real cost and real deadlines.

• VAT returns — quarterly for most businesses. Missing them attracts penalties.
• Corporate tax return — annually, generally in March for a December year-end.
• Withholding tax on salaries, filed monthly.
• Four social insurances for every employee, including yourself as a director drawing a salary.
• Bookkeeping. Almost every small Korean company uses an accounting firm (세무사) on a modest monthly retainer. Doing this yourself in Korean is not realistic for most foreign founders and the fee is low enough that it is not worth trying.

What renewals actually check

First D-8 grants are typically one year. This is where a lot of founders come unstuck, because renewal is assessed on whether the business is real:

• Revenue — or, if there is none yet, a credible explanation and evidence of runway and activity.
• Employees on the payroll, with social insurance records to prove it.
• Rent actually being paid on the office lease.
• Corporate tax returns filed and taxes paid.
• The invested capital still in the business rather than withdrawn.

A company that has filed nil returns for two years and employs nobody will struggle regardless of how clean the original investment was. Plan for the renewal from month one, not month ten.

Hiring

Your own company can sponsor E-7 visas for other foreign staff — but it must satisfy the same employer conditions as any other sponsor, including the national-to-foreign staffing ratio and a filed corporate tax return.

In practice this means a young company must hire Korean employees before it can hire foreign ones. Founders who plan to build an international team from day one should understand this constraint early.

Support that exists and is under-used

• KOTRA's Invest Korea. Free advisory service for foreign investors, including help with the investment notification and incorporation. English-speaking.
• Seoul Global Startup Center and equivalent metropolitan programmes — office space, mentoring, and sometimes funding, specifically for foreign founders.
• K-Startup grants and the OASIS programme, aimed at technology-based foreign founders, with a linked visa route (D-8-4).
• Global business centres run by city governments, offering free consultations on incorporation, tax and employment.

Korea actively wants foreign founders and funds a fair amount of infrastructure to attract them. Most of it is free, and most foreign founders discover it only after paying for the same advice privately.

Where D-8 leads

D-8 is a qualifying status for F-2-7, and business assets and income contribute to the points score. It also counts towards F-5, and there is an investment-led F-5 route for larger investments that sustain Korean employment.

The mistakes that cost the most

1. Remitting capital before filing the investment notification.
2. Using funds already held in Korea.
3. Registering at a virtual office.
4. Treating the company as a visa vehicle rather than a business. Renewals catch this.
5. Underestimating running costs — accounting fees, office rent, social insurance and tax filings are ongoing and unavoidable.
6. Doing it without professional help. This is one of the few areas where the DIY approach reliably costs more than it saves.