Australian subsidiaries for Korean companies: treaty, FIRB, documents and directors

A Korean company can own 100% of an Australian proprietary company, but the Pty Ltd needs at least one director who ordinarily lives in Australia. Three things make the Korean route distinctive. Australia's tax treaty with Korea caps withholding on dividends, interest and royalties at 15%. Korean private investors get the higher FTA-partner FIRB thresholds when they invest directly from Korea. And Korean documents can be apostilled, which keeps certification simple.

The tax treaty: what the 15% caps mean

Treasury's income tax treaties list shows a comprehensive tax treaty in force with the Republic of Korea. It was signed on 12 July 1982, entered into force on 1 January 1984, and has been modified by the Multilateral Instrument. The ATO publishes a synthesised text combining the two.

For money flowing from an Australian subsidiary to a Korean parent that is beneficially entitled to it:

Fully franked dividends carry no dividend withholding at all. The treaty text has no separate, lower dividend rate for a parent company with a large shareholding. The 15% cap applies whatever the size of the holding. A protocol to the treaty commits Australia to negotiate with Korea if it agrees a dividend rate below 15% with another country, so ask your adviser to confirm the current position before relying on the figure.

Royalties matter for Korean groups whose Australian arm pays for brand, technology or software licences. At 15% rather than 30%, the treaty halves the Australian withholding, but only for a Korean resident that is beneficially entitled to the payment. Licences routed through a regional hub in another country are taxed according to that hub's position. How the treaty applies to your flows is a question for your tax adviser. Our company tax guide maps the Australian side.

FIRB: Korea is an FTA partner, with a condition

The 2026 FIRB monetary thresholds, in force from 1 January 2026, put the Republic of Korea on the list of FTA partners whose private investors get the higher thresholds. For Korean private investors:

• Acquiring 20% or more of an entity that isn't in a sensitive business: more than $1,498 million.
• The same in a sensitive business: more than $347 million.
• Agribusiness (a direct interest, generally 10% or more): more than $75 million cumulative.
• Developed commercial land: more than $1,498 million.

The condition is in the table's footnote: the immediate acquirer has to be an entity formed in Korea. If the investment goes through a subsidiary incorporated somewhere else, that jurisdiction's thresholds apply instead.

Some thresholds are $0 for every investor, including national security businesses and land, residential land and vacant commercial land. Foreign government investors face a $0 threshold for all investments. That matters for Korean public institutions and state-linked enterprises, where the question of foreign government investor status should be settled with an adviser early.

Setting up a new subsidiary to start trading is different from acquiring an existing Australian business, and our FIRB basics guide explains which actions need approval. We don't give FIRB advice.

Documents: apostille and translation

Korea has been a party to the Apostille Convention since 2007, according to the HCCH status table, and so has Australia. For Australian registrations that need certified copies, such as a non-resident ABN application or bank onboarding, you have two routes under the ATO's certification rules:

1. Apostille from the Korean competent authority. The ATO accepts both paper and electronic apostilled documents for ABN applications.
2. Certified copy by a notary public in Korea or by staff at the Australian Embassy in Seoul.

Documents in Korean need an English translation by an approved translation service, certified as true and correct. Corporate registry extracts, articles of incorporation and board minutes approving the investment are the usual items.

Names and romanisation

Korean names are written family name first, and passports use a fixed romanisation that may differ from the English name a director uses day to day. Use the passport form, in the same order, on the Director ID application, the ASIC company registration and the tax registrations. A director called "Min-jun Kim" in emails but "KIM MINJUN" on a passport should appear the second way everywhere official.

Working across the time difference

Seoul is on Korea Standard Time, UTC+9, with no daylight saving.

This is one of the easiest pairings for an Australian board. A 10am Seoul board call is 11am or midday in Sydney and 9am in Perth. Signing rounds can usually close the same business day: the Australian director signs in the morning, Seoul countersigns before lunch. The practical risk is the reverse. Korean headquarters may assume the local director will sign the same day as requested, without time to read. Build in at least one business day for anything a director must form a view on, such as the annual solvency resolution.

Common structures, and the trap in each

Direct subsidiary of the Korean parent. The simplest route, and the one that keeps the treaty and the FTA-partner FIRB thresholds. Board approval in Korea, then ASIC registration in Australia. See setting up an Australian subsidiary.

Through a regional holding company. Say a Korean group holds its Asia-Pacific operations through a Singapore company. The Australian Pty Ltd's dividends then go to Singapore, so the Australia–Singapore treaty applies, not Korea's, and FIRB thresholds follow the immediate acquirer. Neither outcome is wrong, but both should be deliberate.

A branch instead of a subsidiary. A Korean company can register in Australia as a foreign company, and it then needs a local agent rather than a resident director. The ASIC fee to register a foreign company is $636, the same as a Pty Ltd. Our subsidiary versus branch guide compares the two.

How we work with Korean groups

We provide the Australian-resident director, with consent and Director ID in place before the Pty Ltd is registered, and run the ASIC compliance calendar so the Seoul finance team isn't tracking Australian deadlines from a different calendar. Appointment is typically within 5 business days of completed checks. Our eligibility checker confirms which structure needs what, and pricing sets out the packages.

General information current at 27 October 2026. Not legal, tax or FIRB advice: confirm treaty and investment questions with advisers in Australia and Korea.

General information about Australian law and practice, not legal or tax advice for your circumstances. Check the official sources, or ask your adviser, before you act.