Netflix Korea became the subject of a tax audit.
On August 26, National Tax Service visited the Netflix Korea office in Jongno-gu, Seoul, and launched a tax investigation. Netflix Korea is reportedly accused of transferring domestic income abroad to evade taxes by paying “advisory fees” to its U.S. headquarters.
It’s pointed out that even though the headquarters did not provide any particular management advice, the Korean subsidiary paid a large amount of advisory fees and made a deficit, giving the U.S. headquarters domestic profits without paying corporate taxes.
In response, Netflix said, “The National Tax Service visited Netflix’s Seoul office. We will sincerely cooperate with the authorities’ requests.”