Educational guide
How to Invoice in South Korea
Tax invoices (세금계산서) for VAT are often issued electronically through Hometax.
This page is for general education only. Tax law, e-invoicing rules, and invoice mandates vary by sector, threshold, and updates from authorities. Confirm requirements with a qualified accountant, lawyer, or government guidance for your situation.
Invoicing in South Korea is built around a highly digitized tax compliance system managed by the National Tax Service (NTS). The standard VAT rate (부가가치세) is 10%, applied to most goods and services. All businesses must register with the NTS and issue tax invoices (세금계산서) that include both the supplier's and buyer's business registration numbers (사업자등록번호), a detailed description of the transaction, and the VAT amount.
Since 2011, electronic tax invoices (전자세금계산서) have been mandatory for all corporations. Individual business owners above an annual revenue threshold set by the NTS must also use the electronic system. E-tax invoices are issued through the NTS Hometax platform (e-Sero) or through integrated ERP systems, and the NTS cross-references them with VAT returns automatically. This high level of automation means data accuracy is critical — the NTS detects discrepancies quickly.
E-tax invoices must be transmitted to the NTS by the 10th of the month following the supply date. Late issuance incurs a 1% penalty of the supply value, and failure to issue at all results in a 2% penalty. Payment is typically via bank transfer (계좌이체) in KRW, and month-end closing (마감) cycles are strictly observed by Korean companies. Business culture in South Korea emphasizes hierarchy, formality, and punctuality — company seals (직인) are expected on important documents, and Kakao Talk is widely used for business communications including invoice confirmations. Records must be retained for five years from the filing deadline of the relevant tax return.
Invoice checklist: common fields in South Korea
What buyers, auditors, and tax authorities often expect to see on a commercial invoice. “Required” reflects typical compliance expectations for registered businesses—not every sole trader scenario.
Seller Name & Address
Usually required상호 (business name), 사업장 소재지 (business address), and 대표자 (representative name). All must match the business registration exactly as filed with the NTS.
Buyer Name & Address
Usually requiredBusiness registration number (사업자등록번호) and legal name of the buyer. For B2C transactions, a cash receipt (현금영수증) may be issued instead of a tax invoice.
Invoice Number
Usually requiredAssigned by the NTS system upon successful transmission of the electronic tax invoice. The number serves as the official reference for both the supplier and buyer in their VAT return filings.
Invoice Date
Usually requiredTransaction date (공급일자) when the goods were delivered or services completed. E-tax invoices must be transmitted to the NTS by the 10th of the month following the supply date.
Business Registration Number
Usually required10-digit 사업자등록번호 for both supplier and buyer. The NTS validates these numbers against its registry during e-tax invoice transmission and cross-references them with VAT returns.
Tax Breakdown
Usually requiredSupply value (공급가액) and VAT amount (세액) at 10%. The total is the sum of supply value and VAT. Each line item should clearly separate the pre-tax amount from the tax component.
Currency
Usually requiredKRW for domestic transactions. Foreign currency transactions must be converted to KRW using the exchange rate on the supply date for VAT calculation and NTS reporting purposes.
Payment Terms
Often optionalVaries by industry, but month-end closing with payment 30-60 days later is the standard practice. Korean companies strictly follow their internal closing cycles for invoice processing.
업태 and 종목 (Business Type and Item)
Usually requiredThe supplier's registered business type (업태) and item category (종목) are required fields on Korean tax invoices. They must match the business registration to avoid NTS validation errors.
Tax and regulatory themes in South Korea
VAT at 10%
Single rate of 10% on most taxable goods and services. Zero rate applies to exports and certain international transportation services.
Mandatory E-Tax Invoices
All corporations must issue electronic tax invoices (전자세금계산서) through the NTS system. Individual business owners above the annual revenue threshold must also use the e-tax system.
Withholding Tax
Payments for certain professional and personal services require withholding at rates of 3% to 22%. Withholding details appear on separate payment records, not typically on the tax invoice itself.
Popular payment methods in South Korea
Methods commonly used for B2B and freelance payments. Availability depends on banks, platforms, and contract terms.
- Bank transfer (계좌이체)
- Credit/debit cards (카드결제)
- Kakao Pay / Naver Pay
- Cash receipts (현금영수증) for B2C
- Cheque (수표, declining)
Business and cultural tips for South Korea
- E-tax invoices must be transmitted to NTS by the 10th of the following month — late issuance incurs a 1% penalty of the supply value.
- Korean business culture emphasizes hierarchy. Address contacts formally and include the company seal (직인) on important documents.
- Kakao Talk is widely used for business communications. Sending invoice confirmations via Kakao can speed up AP processing.
- Month-end closing (마감) is strict in Korean companies — submit invoices before the client's closing date.
- Verify the buyer's business registration number (사업자등록번호) on the NTS Hometax portal before issuing invoices — invoices to closed or suspended businesses create compliance issues.
- Korean companies often request revised tax invoices (수정세금계산서) for corrections rather than credit notes. Familiarize yourself with the revision process on Hometax.
- Include a clear payment reference and your bank account details on every invoice. Korean AP teams process payments in batch cycles aligned with closing dates.
- For transactions with government entities or public organizations, additional procurement documentation may be required alongside the e-tax invoice.
Invoicing in South Korea: common questions
Invoicing guides for other countries
Prefer a product overview for this market? See Billed for South Korea.
Start Invoicing in South Korea
When your process is clear, tools help you stay consistent. Billed supports professional invoices, payment links, and records—use alongside advice from your local professional.
No credit card required. Cancel anytime.