Korea Export Duty Drawback: Deadlines and the Two Claim Methods

Key takeaways

• Korea’s export duty drawback returns customs duties and certain other import taxes paid on raw materials once those materials are used for exports.
• Claims must be filed within five years of the export, and the materials must have been imported within two years before the end of the export month.
• There are two methods: individual drawback, calculated from actual taxes paid per unit of input, and fixed-amount simplified drawback per KRW 10,000 of exports for qualifying SME manufacturers.

Korea’s export duty drawback returns customs duties and certain other import taxes paid on raw materials, once those materials are used in an export. Nothing is paid automatically. The claim must be filed within five years of the date the goods were supplied for export, and the materials themselves must have been imported within two years counted back from the end of the month of that supply.

The legal basis is the Act on Special Cases Concerning the Refund of Customs Duties etc. Levied on Raw Materials for Export. Korea Customs Service sets out the outline on its duty-drawback page.

What the refund actually covers

The taxes that can come back are customs duty, temporary import surtax, individual consumption tax, liquor tax, transport-energy-environment tax, special rural development tax, and education tax. Eligible materials are those whose consumption can be measured: inputs physically or chemically incorporated in the exported product, and inputs consumed directly in the production process. Supplies used only to run or maintain machinery are generally out.

A typical qualifying export is one whose export declaration has been accepted. The claimant is the exporter or the producer named as the refund applicant on the export declaration. In a consignment export, that is the consignor.

Value-added tax zero-rating is a separate regime. Filing a customs drawback claim does not close the VAT file.

Individual claim versus flat-rate claim

There are two methods.

Method	How the amount is built	Papers usually required	Who it fits
Individual	Duty actually paid on the quantity of material used in the export	Proof of export, proof of duty paid, consumption statement or BOM	Firms that can trace the import entry
Flat-rate	A published amount per 10,000 won of export value	Proof of export, SME certificate, factory registration	Smaller manufacturers under the refund-history cap

The flat-rate method is for an SME under the Framework Act on Small and Medium Enterprises whose drawback history was 800 million won or less in each of the two preceding years, and remains at or under 800 million won from 1 January of the claim year through the claim date. Amounts on basic-material tax-payment certificates count toward that history. If the exporter and the producer are different parties, only a claim filed by the producer qualifies. Goods missing from the rate table, large firms, and firms approved out of the flat-rate scheme use the individual method.

The 800 million won figure is a statutory history cap, not a currency conversion. Check the current wording on the UNI-PASS drawback requirements page before filing.

A worked individual claim

The figures below are an illustration, not a published rate.

Suppose 1,000 kg of material was imported and 100,000 won of duty was paid, and 200 kg went into this shipment. The usage ratio is 200 / 1,000 = 0.2. Refundable duty is 100,000 × 0.2 = 20,000 won. Other eligible taxes paid on the same entry are split by the same ratio if they meet the refund tests.

The flat-rate method does not trace that entry. It multiplies export value by the amount per 10,000 won in that year’s table for the product. Tables change. Do not reuse a rate copied from an old worksheet.

Two clocks, not one

The export-performance period asks when the material was imported. Only material imported within two years before the end of the month in which the goods were supplied for export counts. A lot imported three years earlier does not attach to this shipment.

The claim period asks when you file. The deadline is five years from the date of supply for export. Teams often count five years from acceptance of the export declaration and miss that the import date sits outside the two-year lookback.

Mistakes that stall a claim

The name on the export declaration as refund applicant must be the party that files. A producer-side claim filed by the exporter is a common rejection.

Domestic purchase does not automatically kill a claim. If imported duty still sits behind that purchase and can be linked with a basic-material tax-payment certificate, a path may remain. Purely domestic material with no import tax does not qualify.

A loose HS classification undermines the consumption statement. Align the material and the finished good first. The lookup steps are in What is an HS code? How exporters classify goods.

Duty charged by the destination country is not Korean drawback. How a buyer-side tariff lands in the price is a different problem, covered in the 2026 US tariff guide for exporters.

Summary

Drawback returns import duty and listed taxes on materials used in an export, but only on application. File within five years of supply for export, and use material imported within the two-year lookback from month-end. Prove the duty paid and you are on the individual method. Eligible smaller manufacturers can use the flat rate per 10,000 won of export value. Keep the applicant name, the bill of materials, the HS code, and foreign duty in separate columns.

Related reading: How to issue a certificate of origin, What is an HS code?

FAQ

Is duty drawback paid automatically after export?

No. It is a claim-based refund that must be filed within five years of the date the goods were exported.

Which taxes can be refunded?

Customs duty and the other import-stage taxes listed in the Act, such as individual consumption tax, liquor tax and education tax. VAT refunds and zero rating are a separate system.

Who can use simplified fixed-amount drawback?

SMEs whose drawback record was KRW 800 million or less in each of the previous two years and in the current year to date. If exporter and producer differ, the producer must file.

Can materials bought in Korea qualify?

Yes, if import duty was paid earlier in the chain and is carried through a basic raw-material tax payment certificate. Domestic materials that never bore import tax do not qualify.