Corporate R&D Lab Registration Risks When Using an Agency — Korea 2026

1. Why Agency-Assisted Registrations Carry Risk

Recognition of corporate research labs, granted by the Minister of Science and ICT with applications handled by the Korea Industrial Technology Association (KOITA), is in high demand due to the significant tax benefits. Some agencies promise quick registration by inflating researcher credentials or listing phantom researchers — exposing companies to criminal liability.

2. Common Fraudulent Practices

• Listing employees with no research background as "researchers"
• Using researchers from other companies temporarily
• Creating fake research plans that do not reflect actual R&D activities
• Registering a "research facility" that is just a storage room

3. KOITA Audit Red Flags

• Researcher doesn't know their research project when auditors ask
• Research space has no equipment appropriate to the stated research
• Research expenditure records don't match the registered activities
• Researcher employment records show they were hired only briefly before registration

4. Consequences of Non-Genuine Registration

• Recognition must be cancelled where it was obtained by false or fraudulent means, and the company cannot apply again until 1 year has passed from the cancellation date
• R&D tax credits do not apply to costs incurred on or after a date set by the cancellation ground (for fraud, from the start of the tax year that includes the recognition date)
• Criminal charges for tax fraud are possible

5. How to Verify Agency Legitimacy

• Check if the agency is a licensed administrative agent office (행정사 사무소)
• Request references from past clients
• Avoid agencies that promise results without reviewing your actual R&D activities

6. Safe Practices

• Only register researchers who are genuinely employed and conduct R&D
• Document all research activities with dated records
• Have a licensed administrative agent prepare the application honestly