2. The costs of lawsuit shall be borne by the Plaintiff.

Cheong-gu Office

1.

The disposition of imposition of the corporate tax on February 6, 2012 imposed by the Defendant on the Plaintiff for the business year 2006, the corporate tax on April 13, 2012, the corporate tax on the business year 2007, the corporate tax on the business year 2008, the OOO, the business year 2009, the OOO, and the OOOO for the business year 2010.

A. BBS Korea Co., Ltd. (hereinafter “Plaintiff”) reported the BB education engineering research institute (hereinafter “instant research institute”) on March 9, 199 to a company-affiliated research institute under Article 7(1)2 of the former Technology Development Promotion Act, and was recognized by the head of the CCC on April 13, 1999.

B. From October 27, 201 to January 4, 2012, the director of the Seoul Regional Tax Office: (a) conducted an integrated investigation into corporate entrepreneurs for the business year 2010 from 2006 to 2010; and (b) notified the Defendant of the purport that, from 2004 to 2010, the Plaintiff reported research and human resources development expenses (hereinafter “research and human resources development expenses”) reported to the Defendant that the Plaintiff had worked in the instant research institute and human resources development expenses were not satisfied the requirements for tax credit; and (c) DaD was not actually working from 2007 to 2009 on the ground that the Plaintiff had not actually worked in the research and human resources development expenses.

C. For this reason, the defendant corrected and notified the corporate tax as follows.

Date and

Business year

Amount

February 6, 2012

206 Business year

OOOE

April 13, 2012

207 Business year

OOOE

208 Business year

OOOE

209 Business year

OOOE

2010 Business year

OOOE

D. After that, according to the result of the Plaintiff’s objection that the Plaintiff constitutes a subject of special tax reduction or exemption for small and medium enterprises as prescribed by Article 7 of the former Restriction of Special Taxation Act, and that leapD worked as the Plaintiff’s employee from 2007 to 2009, each tax amount was reduced as follows. The process of corporate tax correction is as follows (hereinafter “the disposition of this case”).

Business year

First Correction

Special Tax Amount for Small and Medium Enterprises

MaD Reduction

Amount of remaining disposal

206 Business year

OOOE

-OOOwon

OOOE

207 Business year

OOOE

-OOOwon

-OOOwon

OOOE

208 Business year

OOOE

-OOOwon

-OOOwon

OOOE

209 Business year

OOOE

-OOOwon

-OOOwon

OOOE

2010 Business year

OOOE

-OOOwon

OOOE

E. On March 4, 2014, the Tax Tribunal dismissed the Plaintiff’s request for adjudication on the Plaintiff’s research and manpower development expenses.

[Ground of recognition] Facts without dispute, Gap evidence 1, 4, and Eul evidence 1 to 4 (including paper numbers; hereinafter the same shall apply)

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The Plaintiff is a corporation that conducts research on the development of short-term language teaching materials and computer programs, and the research institute of this case was recognized as a business-affiliated research institute pursuant to the former Technology Development Promotion Act. In fact, the research institute of this case spent personnel expenses for actual research human resources, such as researchers, etc. engaged in actual research duties several times in each taxable year, and thus, the research institute of this case satisfies the requirements for tax credit for research and human resources development expenses prescribed in Article 10 of the former Restriction of Special Taxation Act. Therefore, the instant disposition that did

2) On August 14, 2009, the Plaintiff was recommended by the Seoul Regional Tax Office to revise corporate tax reduction for the business year 2008 from 2004 to 2008, and paid corporate tax by filing a revised report thereon. As such, at least a tax credit for research and human resources development expenses was finalized until the business year 2008, and it was against the principle of trust and good faith to completely deny the tax credit by conducting a consolidated investigation after about two years thereafter.

B. Relevant statutes

It is as shown in the attached Form.

(c) Fact of recognition;

1) The Plaintiff was recognized as a company-affiliated research institute under the former Technology Development Promotion Act on April 13, 1999. The research field is "information services (development of short-term language teaching materials and computer programs)". Meanwhile, the research institute of this case was revoked on May 19, 2013.

2) The Plaintiff’s current status of patent and registered trademark, details of research and development activities reported to the CCC Association, and the award details are as follows.

The current status of patents and registered trademarks - omitted

Details of research and development activities - omitted

Details of award. - omitted

3) The instant research institute conducted the development of teaching materials, the revision of existing teaching materials, the shooting of educational videos, the improvement of online learning rooms, the production of test papers, etc. The researchers conducted the tasks of utilizing new teaching materials, teaching teaching materials, instruction and lectures, the work of reading materials North Korea, and the preparation of Internet hearing questions, and received evaluation of the results therefrom. Meanwhile, some of the researchers of the instant research institute conducted testing supervision or conducted the tasks of producing calendars, etc. as affiliated with the design team.

4) The Plaintiff reported and paid revised corporate tax reductions and exemptions from 2004 to 2008 in accordance with the recommendation for revision of the Seoul Regional Tax Office.

[Ground of recognition] Facts without dispute, entry B in the evidence Nos. 8 through 11, purport of the whole pleadings

C. Determination

1) According to Article 10(1) of the former Restriction of Special Taxation Act, Article 9(2)1(a) of the Enforcement Decree of the same Act, and Article 7(2) of the Enforcement Rule of the same Act, personnel expenses for researchers engaged in research in the field of science and technology while working in a business-affiliated research institute recognized under the former Technology Development Promotion Act and persons who directly support their research work shall be subject to tax credit under the same Act.

As seen earlier, the research institute’s business-affiliated research institute recognized under the aforementioned Technology Development Promotion Act is not equipped with evidence to prove that its recognition was revoked in each taxable year of this case or that the standards for training personnel and facilities required by the above Acts and subordinate statutes are not met. Thus, the research institute of this case constitutes a research institute subject to tax credit under the Restriction of Special Taxation

2) Article 9(5) of the former Restriction of Special Taxation Act (amended by Act No. 11133, Dec. 31, 2011); however, Article 9(5) of the Restriction of Special Taxation Act (amended by Act No. 111133, Dec. 31, 201) prescribed research and development as “activities to achieve scientific or technical development and to develop a new service and service delivery system” and expanded its scope of application.

In addition, Article 7 (2) of the former Enforcement Rule of the Restriction of Special Taxation Act (amended by Ordinance of the Ministry of Strategy and Finance No. 264 of Apr. 7, 201) provides for the scope of tax credits as "research personnel engaged in research in the field of science and technology and persons who directly support their research work", but Article 7 (3) of the Enforcement Rule of the Restriction of Special Taxation Act (amended by Ordinance of the Ministry of Strategy and Finance No. 264 of Feb. 28, 2012) provides that "research personnel engaged in research work in the relevant department, etc. and persons who directly support their research work" and does not limit

The purport of the special provisions is to facilitate research and development by granting more benefits from tax credit to taxpayers for investment in research and development (see, e.g., Supreme Court Decision 2000Du3115, Jan. 22, 2002). The interpretation of the requirements for tax reduction or exemption under the principle of no taxation without law is not to be interpreted flexibly or analogically (see, e.g., Supreme Court Decision 2002Du9537, Jan. 14, 2003). In light of the history and purpose of the special provisions, the scope of the special provisions should be construed to include only research personnel engaged in the activities to achieve scientific or technical development from 2006 to 2010, and research personnel engaged in the activities to develop a new service and service delivery system should be construed to be subject to tax credit for the business year 2012.

According to the above facts, the research institute of this case was recognized as a company-affiliated research institute in the field of information service. However, the Plaintiff registered three programs in 199 with the EE Agency and did not register a new program. Since 2006, the research and development of the program was excluded from the development of research and development activities reported to the CCC Association.

In view of the Plaintiff’s registered trademark or patent, the Plaintiff developed new teaching materials or educational methods during the pertinent taxable period. The research institute’s duties are mainly engaged in research on the development of teaching materials and educational methods using teaching materials, and some of the researchers were engaged in duties that seem to have no relationship with research on the method of education, such as test supervision and the production of calendars. The Plaintiff’s water field is also English learning field.

In light of the research and development activities of the research institute of this case, the research institute’s work content, the Plaintiff’s registered trademark and patent contents, and water experience, etc., it is insufficient to recognize the research institute’s work as a research task in the field of science and technology solely based on the program development details, registered trademark, and water performance claimed by the Plaintiff. Accordingly, the Plaintiff’s assertion on

3) Meanwhile, it is difficult to view that the Defendant granted trust to the Plaintiff on the sole basis of the fact that the Plaintiff received a recommendation for revision from the Seoul Regional Tax Office and filed a report on revision of corporate tax reduction for business year 2008 from 2004, and paid corporate tax accordingly (see Supreme Court Decision 2011Du5940, Dec. 26, 2013). The Plaintiff’s assertion that the instant disposition goes against the principle of good faith is no further examined.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.