The practical implications of the Finland-South Korea Tax Treaty and the European Union-South Korea Free Trade Agreement for small and medium-sized enterprises
Han, Jaehyung (2025)
2025
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2025121737649
https://urn.fi/URN:NBN:fi:amk-2025121737649
Tiivistelmä
International trade and investment have been increasing constantly between Finland and South Korea and the European Union and South Korea. Nevertheless, small and medium-sized enterprises (SMEs) from Finland and South Korea remain with challenges because of taxation and customs requirements. To solve the issues, both the Finland and South Korea Double Taxation Agreement (DTA) and the European Union and South Korea Free Trade Agreement (FTA) are introduced for lowering risks and barriers.
This research conveys the practical analysis of the Finland and South Korea Double Taxation Agreement (DTA) and the European Union and South Korea Free Trade Agreement (FTA), especially from the perspective of SMEs. The key focus areas are cross-border taxation of dividend repatriation, royalty payments, and product exports between Finland and South Korea. Across the analysis, a multi-method approach applies theoretical frameworks from the literature review. These include the Uppsala model from literature review, treaty text analysis, and practical implementation of financial case simulation.
The three different financial case simulations compare the impacts of the agreements under different treaty conditions. As a result, this study demonstrates the impacts of the Double Taxation Agreement (DTA) and the Free Trade Agreement (FTA) as a remedy for reducing unpredictability and uncertainty for SME internationalization as well as discussing their limitations.
The study concludes with suggestions for SMEs that appropriate treaty utilization improves their financial situations and reduces perceived market risk. Additionally, the findings offer a practical decision-making framework and guidelines to support SMEs in Finland and South Korea that encounter challenges in compliance and awareness of cross-border tax rules.
This research conveys the practical analysis of the Finland and South Korea Double Taxation Agreement (DTA) and the European Union and South Korea Free Trade Agreement (FTA), especially from the perspective of SMEs. The key focus areas are cross-border taxation of dividend repatriation, royalty payments, and product exports between Finland and South Korea. Across the analysis, a multi-method approach applies theoretical frameworks from the literature review. These include the Uppsala model from literature review, treaty text analysis, and practical implementation of financial case simulation.
The three different financial case simulations compare the impacts of the agreements under different treaty conditions. As a result, this study demonstrates the impacts of the Double Taxation Agreement (DTA) and the Free Trade Agreement (FTA) as a remedy for reducing unpredictability and uncertainty for SME internationalization as well as discussing their limitations.
The study concludes with suggestions for SMEs that appropriate treaty utilization improves their financial situations and reduces perceived market risk. Additionally, the findings offer a practical decision-making framework and guidelines to support SMEs in Finland and South Korea that encounter challenges in compliance and awareness of cross-border tax rules.