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5-6 · Business confirmation certificates

Profit-Sharing Company Confirmation

A profit-sharing company is a small or medium-sized enterprise that shares, or has agreed to share, business performance with its employees under Article 27-2 of the Special Act on Support for Human Resources of Small and Medium Enterprises, and under Article 26-2 of its Enforcement Decree an enterprise seeking confirmation applies to the Minister of SMEs and Startups with documents proving that it falls under a profit-sharing type. The recognized types are a performance bonus system in which business goals and bonus payments are agreed in writing in advance, enrollment in the performance compensation mutual aid for young and key employees, wage increases where the average wage growth rate exceeds the standard, operation of an employee stock ownership plan or in-house welfare fund, grants of stock options, and types set by public notice. A company already sharing profits is confirmed as a profit-sharing adopting company, and one that has only signed an agreement with employees is confirmed as a future profit-sharing company, and the confirmation is valid for 1 year from the date of confirmation. Because it is used for bonus points in government and local government support programs and for reviewing tax treatment of performance bonuses, keep a valid confirmation in line with the support program application schedule.

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#Profit-Sharing Company Confirmation#Official check#5-6
🌐 How to Obtain Performance-Sharing Enterprise Confirmation
01

Procedure

Procedure

Procedure type
  • Confirmation Difficulty Medium

    The authority reviews documents, and where needed carries out an on-site inspection, to confirm that statutory criteria such as company size, ownership or research staff are met before issuing a confirmation or recognition certificate.

  1. 01

    Choosing the profit-sharing type: Decide which method the company already runs or will introduce among those listed in Article 26-2 of the Enforcement Decree: performance bonus system, enrollment in the performance compensation mutual aid, wage increases, employee stock ownership plan or in-house welfare fund, and stock options. Performance bonuses are recognized only if business goals and payment criteria were agreed in writing in advance.

  2. 02

    Adopting company or future company: If profit sharing has already been carried out, apply as a profit-sharing adopting company; if nothing has been paid yet, sign a profit-sharing agreement with employees and apply as a future profit-sharing company. A future profit-sharing company confirmation cannot be extended, so plan to actually share profits within the period and obtain a new confirmation as an adopting company.

  3. 03

    Checking wage levels: For the wage increase type, the average wage growth rate for the year must exceed the average of the previous 3 years' growth rates or the rate set by public notice, so calculate the growth rate by year from the payroll. Also compare before applying whether total wages per full-time employee fell from the previous year.

  4. 04

    Organizing supporting documents: Gather documents proving the chosen type, such as bonus payment rules and payment records, written agreements or profit-sharing agreements, payroll, employee lists, and records of employee stock or stock option grants, and check that the profit-sharing details and amounts entered in the application match the evidence.

  5. 05

    Online application and managing the confirmation: Upload the application and evidence to the online system under the Ministry of SMEs and Startups and respond to supplementation requests. Once the confirmation is issued, use it as a bonus-point document when applying for support programs, and an adopting company obtains reconfirmation by proving its performance within the validity period.

02

Filing route

Filing route

Online profit-sharing company confirmation application under the Ministry of SMEs and Startups

Confirm the current filing office, jurisdiction, and online availability on the official website.

Official check
Actual processing agencyCompetent Korean authority or official service
Statutory and policy authorityMinistry of SMEs and Startups
Online routeCompetent Korean authority or official service
03

Deadlines & processing notes

Deadlines & processing notes

Check deadlines and next steps against the notice, filing date, and any request for additional documents.Official check
04

Basic documents

Basic documents

Basic documents0 / 7

The confirmation is valid for 1 year and a future profit-sharing company confirmation cannot be extended, so check the expiry date first to make sure a valid confirmation is in hand when applying for support programs.

Scope of services

Scope of services

Hwang Yunsang Administrative Agent Office prepares and translates documents for administrative agencies, submits them on your behalf, and guides you through permit, application, and notification procedures. Services that require the principal’s personal appearance, principal’s application, or electronic signature may be limited in delegation.