Since the difference in this case cannot be seen as being eligible for foreign tax credit under the Corporate Tax Act, the disposition in this case is legitimate.

Even if the tax amount to which the limited tax rate of 5% is applied under the Korea-China Tax Treaty was paid to China, the tax amount equivalent to 5%, which is the difference of 10% of the treaty of this case, shall not be deemed to be the amount equivalent to the tax amount reduced or exempted by the

Article 57(3) of the Corporate Tax Act

Daejeon District Court-2015-Gu Partnership-105765

With respect to the latter part of the provision, a domestic corporation's profits accrued after January 1, 2008 from a Chinese subsidiary.

If dividends are paid as financial resources for surplus funds, the credit for deemed foreign tax credit may be applied.

as the public opinion was expressed, the plaintiff's request for correction was rejected, unlike the above public opinion.

The disposition is illegal because it violates the principle of protection of trust.

2) The defendant's assertion

A) Article 10(2) of the Korea-China Tax Treaty for the source income tax to be paid by the Plaintiff to China

Since 5% of the limited tax rate under subsection (a) is applied, in Korea pursuant to this case,

In order to make a foreign tax payable to be deducted, the Chinese law has the limited tax rate of 5%.

provisions that reduce more than the amount of tax must be provided, and such difference shall be deemed foreign tax credit.

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Only can it be received. The latter part of the instant provision sets the limit of deduction as 10%.

In addition, there is no provision that considers a deduction of 10%, so the "limited tax rate" shall be set within the above limit.

prescribed the scope of tax credit. The latter part of the provision of this case also sets forth the scope of tax credit in harmony with the expertise.

In other words, foreign tax credit deemed to be foreign tax credit under the Korea-China Tax Treaty is the Chinese domestic law.

applicable laws and regulations relating to such measures shall exist and shall be subject to such Chinese domestic laws.

the scope of the reduction or exemption shall be 10% only when the latter part of the tax reduction or exemption is made.

It should be considered that this case is more than 5% which is the limited tax rate under the Korea-China Tax Treaty.

Since there is no tax incentive measure under the Chinese domestic law that reduces the above sentence, the latter sentence does not apply.

In this case, Article 27 of the Income Tax Act of China and Article 91 of the Enforcement Ordinance thereof shall apply.

Other tax incentives for the reduction, exemption, or promotion of economic development as provided in the provisions of

It does not correspond to the relevant legal provisions, and even if it falls under such provisions, it shall be mitigated.

section 10(2)(a) of the Korea-China Tax Treaty, the limited tax rate applicable to the Plaintiff

The tax rate of 20% outside the scope of 5% is lower than 10%, and it is merely eligible for tax credits.

shall not be deemed to have been dismissed.

B) The tax authority’s contribution to taxpayers on the basis of only tax guidance for entering China in 2008.

investment in China by the Plaintiff in trust in the above booker is not deemed to have expressed an explanation of the enemy, and the investment is also made in China.

Therefore, the principle of trust protection is not applied.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Whether foreign tax credit is deemed granted or not

Article 5

1.Paragraph 3 of Article 23 of the Agreement shall be deleted, replaced by:

for a year.

3.Taxes paid in one Contracting Party referred to in paragraphs 1 (a) and 2 of this Article.

tax reduction, exemption, or promotion of economic development, there was no other relevant laws or regulations relating to other tax incentives.

for purposes of this paragraph, Section 2 of Article 10;

In the case of Articles 11(2) and 12(2), the tax amount shall be 10 times the total amount of dividend, interest, and usage fees, respectively.

“A license shall be deemed to have been granted.”

Posium Areacting State State in sub lagraph (a) 1

2(1)(1)(1)(2)(2)(2)(2)(2)(2)(2)(2)(2)(2)(2)(2)(2

been payable but for the legal provisions concerning tax reduction, exemption or other

A) Article 57(3) of the Corporate Tax Act provides that a domestic corporation which has income from overseas sources may enter into a tax treaty;

Amount equivalent to the tax amount reduced or exempted by corporate tax on the relevant foreign source income in the counterpart country shall be the relevant tax treaty.

subject to the tax credit or inclusion in deductible expenses pursuant to paragraph (1) within the scope prescribed by this Act.

The Korea-China Tax Treaty, which falls under the above tax treaty, provides that foreign corporate tax shall be deemed foreign corporate tax amount.

23(1) In the case of a 'Korean resident', double taxation shall be avoided as follows:

Korea’s tax credit from the Korean tax that is allowed for the tax paid by the Corporation

under the tax law (it shall not affect the general principles of this subsection).

laws of China and this Agreement, whether directly or by mutual aid for source income in China

China's tax to be paid (in the case of dividends, the tax to be paid for the profits on which the dividends are paid).

(b) a tax credit shall be granted from Korean tax payable on such income. Such credit shall be granted.

B. The deductible tax amount is that the source income in China accounts for the total income subject to Korean tax payment.

subsection (1) of this section shall not exceed the amount of Korean tax corresponding to the proportion of the

Section 5(1) of the Second Protocol replacing Article 23(3) of the existing Korea-China Tax Treaty (the provisions of this case)

Paragraph (1) provides that:

For the State, the economic devement for the State, the Forenomic devement of the Republic of Korea.

the purpose of this paragraph, the amount of tax shall be deemed to be 10 percent of

2. The Spons of the Parties: divends of the Republic of Korea, interest interest and royt case 2.

The Articles 10, 11 and 12 of the Articles of the Public Officials Act, and the 12, 200.

Such a foreign tax credit system shall have the effect of tax benefits paid by a capital importing country.

The purpose of the preservation order is to protect the other party's country within the prescribed scope of the taxation authority;

In other words, the scope of the tax authority determined by the source country has been reduced by itself by the tax reduction regulations.

It is premised that the action must be brought.

B) However, the limited tax rate as stipulated in Article 10(2)(a) of the Korea-China Tax Treaty

The maximum tax rate at which a resident or a corporation of a Contracting State may be taxed under the tax treaty.

mean (Article 2 subparag. 12 of the Adjustment of International Taxes Act) and one chemicals for dividend income;

dividend income received by a resident of the other Contracting State from a corporation, etc. of the other Contracting State;

source country of the other Contracting State, which is the source country of the acquisition, shall operate to the extent of the tax rates taxable in the other Contracting State.

The function of double taxation is to prevent double taxation through the adjustment of the taxation authority between the resident countries.

In this case, the scope of the taxing authority of the source country for dividend income has been established by setting the rate.

When China, the source country, reduces the scope of the taxation right finalized, i.e., the above limited tax rate;

foreign tax payable, only when there is a provision relating to tax incentives reduced, the difference shall be deemed to be the same.

The treaty itself, which provides for limited tax rates, shall be subject to amount deduction, is China's tax reduction regulations.

In this case, the Plaintiff did not receive any benefit from the tax reduction or exemption under the Chinese domestic law.

On the other hand, as seen earlier, the limited tax rate of Korea-China Tax Treaty is 5% and the limited tax rate provisions are applicable.

In this case, the term "tax reduction or exemption" as provided in the provision of this case is applied only to the case.

other laws and regulations related to tax incentives for promoting economic development more than the limited tax rate.

Since it means the Chinese domestic law rate that grants a reduction or exemption, the tax rate outside the scope of the limited tax rate.

the Chinese corporate income tax and its enforcement ordinances or limited tax rates set forth in this section.

Article 10 (2) (a) of the Tax Treaty shall not apply to this case.

C) Before January 1, 2008, China's credit investment enterprises and foreign companies in the People's Republic of China.

For a foreign-capital invested enterprise under Article 19(1) of the Income Tax Act (hereinafter referred to as the "Foreign Investment Enterprise Act"),

In order to apply foreign capital investment laws, etc. in addition to domestic and foreign capital enterprises, dividend payments for foreign capital enterprises;

Though full exemption from the tax to obtain tax, unification of internal business with foreign enterprises from January 1, 2008

A single tax rate of 25% under the Income Tax Act has been applied by regulation.

(4) Article 4 of the Chinese Corporate Income Tax Act: Provided, That a non-resident enterprise shall have its place of business (the organization and place) in the China.

(2) If the income acquired is substantially from the place of business; or

The withholding tax rate of the corporate income tax on the source income in China shall be 20%.

The following (Articles 4 and 3(3) of the Chinese Corporate Income Tax Act), the rate of which has been reduced by 10% again:

C. (Article 27(5) of the Chinese Corporate Income Tax Act, Article 91 of the Chinese Corporate Income Tax Act

20% tax rate of 20% with respect to dividend income tax on high-priced dividends shall be reduced to 10%

The limited tax rate under the Korea-China Tax Treaty was lower, and therefore, the Chinese Corporate Income Tax Act was 1)

It was taxed to 5% of the limited tax rate regardless of the other.

라) 이 사건 조항의 후문은 문언상 '이 항의 목적상(For the purpose of this

Since paragrah is referred to as "paragrah", it is not possible to interpret the preamble and the latter separately, and the part thereof.

there is a provision of tax reduction or exemption in the Chinese domestic law as prescribed in such Chinese law, and

(2) The lower court’s judgment is justifiable, and the lower court did not err in its judgment.

In other words, the meaning of 'the tax amount' is clear, i.e., the necessity of 'the tax amount'.

The scope of reduction or exemption will be at issue if the case is met, and the latter part will be the scope of such reduction or exemption.

to mean that “amount” shall be deemed 10 per cent, with respect to the scope and scope of the latter part of the provision of this case.

all of them are limited to ‘for the purposes of this subsection’ and thus tax credits under the latter sentence shall be the same as that under this subsection.

to apply for purposes and to promote economic development, which is the most fundamental premise of a medical specialist;

It is reasonable to interpret that the existence of one tax incentive measure is applied as it is to the latter.

E) With respect to the purport of the latter part of the provision of this case, the Health Center, and the latter part of the provision of this case, China

(20%) Exemption from taxation (20%) on dividends of non-resident enterprises prior to the amendment of the Income Tax Act (20%)

A provision inserted for the equity of tax at the time of being in existence is a provision inserted for equity. In other words, regardless of equity investment rates.

In the absence of taxes in China, equity investment in the absence of the latter part of the provision of this case.

on the other hand, a company may be deemed to be eligible for foreign tax credit only 5% of the total amount of equity investment.

corporation is entitled to a foreign tax credit of 10% deemed as 10%, so the corporation has made a large amount of equity investment

The provisions of this case are inserted to correct the problems which would be more unfavorable to the business, and after the provision of this case

As a result, foreign tax credit of 10% deemed as 10% regardless of equity investment ratio is applied.

tax benefits to an enterprise which has a large number of equity investments, as it is entitled to receive such equity investments;

This could be prevented.

However, after the enforcement of the Chinese Corporate Income Tax on January 1, 2008, the dividends shall be paid to foreign capital enterprises.

as a matter of principle, the system to exempt the full amount of tax on income is abolished, and thus, the corporation is a non-resident enterprise.

under the circumstances in which 10 per cent reduction rate (20 per cent ? 10 per cent) applies to dividends, or except that equity investment

For a large number of enterprises, the limited tax rate under the Korea-China Tax Treaty is lower than that under the China-China Tax Treaty.

It was taxed to 5% of the limited tax rate regardless of the corporate income tax, and the plaintiff's assertion

On January 1, 2008, when the latter part of the provision of this case is applied until after the enforcement of the Income Tax Act of China, land

An enterprise which has less decentralization is taxed from China to 10% and has 10% foreign tax credit.

An enterprise that is subject to foreign tax credit (not including foreign tax credit) while making a large amount of equity investment;

Under the limited tax rate under the tax treaty, 5% foreign tax credit and 5% foreign tax credit for China

5% deemed as 5% foreign tax credit, resulting in a large number of equity investments;

A Chinese company whose equity investment is less than equity investment is equal to that of tax benefits.

Without reasonable grounds, compared to the circumstances before the amendment of the Income Tax Act, a company with less equity investment

It is very favorable that taxation in China occurs (a company that has a large number of equity investments).

5% deemed foreign tax credit in Korea, even though there was no tax reduction or exemption in Korea

The effect of tax exemption from the economic point of view is that the plaintiff is exempt from all taxes.

Foreign tax subscription deemed to be foreign in that it is not the result of preserving the tax paid to China.

In particular, on January 1, 2008, China's corporate income tax on January 1, 2008

The system of exempting foreign capital enterprises from total amount of tax on dividend income is abolished by the enforcement of the Act.

The purpose of this study is to be more so-called.

F) As seen earlier, Article 10(2) of the Korea-China Tax Treaty provides that a beneficial owner shall pay dividends.

corporation that directly owns at least 25 percent of its capital stock, 5 percent of the total amount of dividends;

In all other cases, each limited tax rate is differentiated at 10% of the total amount of dividends. Such dividends are divided.

Since the differential limited tax rate is clearly distinguishable from the tax credit, the dividends shall be distributed under the case.

The purpose of applying the low limited tax rate to corporate dividends in the differential limited tax rate on dividends.

The low limited tax rate shall apply to a company which has a large amount of equity investment, and more taxation shall be imposed in the country of residence.

It is only to avoid double taxation by allocating rights, and the economy of low-developed countries through tax reduction and exemption.

(b) Foreign tax credit deemed to be foreign tax credit for development

Tax incentives shall be determined by the source country within the scope of the prescribed tax authority.

It is premised that the scope of the taxation right should be reduced by itself, and on such premise, the capital should be reduced by itself.

foreign countries deemed to have the effect of tax reduction and exemption for such investor;

The essence of the system is the part beyond the scope of the limited tax rate from the beginning (in this case, the plaintiff)

The reduction rate (10%) higher than the applicable tax rate (5%) is set out in the Chinese Corporate Income Tax Act.

the concept of tax reduction or exemption in the source country because the source country's taxation right is not applicable.

As such, tax incentives for economic development cannot be determined, the low dividend tax rate under such tax treaty.

It is difficult to regard it as a measure.

G) Therefore, 5% of the limited tax rate stipulated in Article 10(2)(a) of the Korea-China Tax Treaty

The difference between 10% and 10% of the latter part of the provision of this case even if the tax applied to China was paid.

amount of tax equivalent to 5% per cent in China under section 57(3) of the Corporate Tax Act ("China").

Since it cannot be deemed as a "amount equivalent to tax reduced or exempted on the relevant foreign source income"

In this case, the tax amount equivalent to the above 5% is not considered to be foreign tax credit.

Dispositions are legitimate.

2) Whether the principle of trust protection is applied or not

tax authorities name a public opinion list subject to taxpayers' trust, and the taxpayer

There is no cause attributable to the taxpayer to believe that the tax authority’s statement of opinion was justifiable and trusted;

taxpayer has trusted the name of his opinion and committed an act to what extent it is, and the tax authority has made

Where a disposition contrary to a statement of opinion results in infringement of the taxpayer's interest;

The principle of protecting trust can be applied to the acts of tax authorities (Supreme Court Decision 2006 April 2006).

27. Decision 2003Du7620 decided Feb. 1, 201; however, the declaration of intention by the tax authorities is a general theoretical statement of opinion.

If only, the principle of trust protection cannot be applied.

In light of the above legal principles, according to Gap evidence No. 7, the National Tax Service will examine the case.

Around September 2008, the book "Tax Guidance for companies entering China" was published, and the booker is the booker.

It explains changes in the foreign tax credit system due to the enforcement of the Chinese Corporate Income Tax Act.

'A number of Korean parent companies holding at least 25 per cent of the shares of Chinese subsidiary companies received from Chinese subsidiary companies

Current income shall be subject to the limited tax rate of 5% under the Korea-China Tax Treaty and withheld in China.

and through the "direct foreign tax credit" for 5% directly paid in Korea.

E. The difference between 10% of the deemed payable rate and 5% of the actual withholding tax rate under the instant provision

The phrase "which would be subject to the application of foreign tax credit as deemed to be paid to a State tax"

Although the facts stated are recognized, in light of the contents and methods of the above book, the above opinion is divided.

The principle of trust and good faith applies to the third party merely because it is a general statement of opinion of the tax authorities.

It cannot be said that the Plaintiff’s assertion is an expression of public opinion by the Defendant. Even if it is deemed that the Plaintiff’s assertion was an expression of public opinion

Evidence supporting the circumstances such as reliance on the above-mentioned responsible person and committing any act

The plaintiff did not have any effect (the plaintiff established the subsidiary of this case in 2005, prior to the publication of the above book).

In light of the above, it is difficult to deem the instant disposition to be in violation of the principle of trust protection.

Therefore, the plaintiff's assertion on this part is without merit.

3. Conclusion

The plaintiff's claim is dismissed on the ground that it is without merit.

The member lecture service corporation

The Director of the National Tax Service

on October 11, 2017

on October 29, 2016

1. Details of the disposition;

A. The plaintiff is established around September 1946 and businesses such as various chain manufacture and sales business, voltage business, import and export business, etc.

investment of 100% equity in the People's Republic of China (hereinafter referred to as "China").

In order to establish the Inter-Gyeongwon Asia Limited Corporation (hereinafter referred to as the "subsidiary of this case"), the subsidiary of this case was established.

B. A surplus accrued after January 1, 2008 by the subsidiaries of this case as indicated in the following table:

Deemed dividend (hereinafter referred to as "the dividend of this case") shall be paid in accordance with the holding of the fictitious dividend with the financial resources of B.

The subsidiary received 5% of the dividend of this case and paid it to China.

the Defendant, reflecting a tax credit equivalent to the amount of foreign tax paid directly to the Defendant stated in the Schedule, the business year 2012

The corporate tax was reported and paid.

C. On January 30, 2015, the Plaintiff: (a) 5% of the deemed foreign payment rate for the instant dividends to the Defendant.

In application, the amount of foreign tax credit is increased and related to the return of corporate tax for the business year 2012

applicable tax amount of KRW 324,210,648 as additional foreign tax credit

On April 14, 2015, the Defendant filed a claim with China under the Korea-China Tax Treaty.

The reason why it is not a substantial tax reduction or exemption for attracting investors received from the tax authorities

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the plaintiff's claim was rejected (hereinafter referred to as the "disposition of this case").

D. On July 8, 2015, the Plaintiff dissatisfied with the instant disposition, filed an appeal with the Tax Tribunal for adjudication on July 8, 2015,

The above claim was dismissed on September 14, 2015.

[Ground of recognition] Unsatisfy, Gap evidence 1 to 9 (including additional number), the whole pleadings

purport of this chapter

2. Whether the instant disposition is lawful

A. Summary of the parties' assertion

1) The plaintiff's assertion

A) The Business Income Tax of the People's Republic of China (hereinafter referred to as the "China Business Income Tax") amended on January 1, 2008

Articles 3 and 4) 3 and 4 shall apply to the income acquired by the non-resident, such as the plaintiff, in the Chinese calendar.

chapter 4 of the Chinese Corporate Income Tax Act provides that income tax shall be imposed at a rate of 20%.

(Tax Benefits) Section 27 of this title, located below, provides that exemption or reduction may be granted.

In addition, Article 91 of the Chinese Corporate Income Tax Act stipulates that the tax rate shall be 10%.

Article 27 of the Income Tax Act and Article 91 of the above Enforcement Ordinance shall have income between the Republic of Korea and the People's Republic of China.

Protocol II of the Agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes (hereinafter referred to as the “Protocol II”).

section 5(1)(hereinafter referred to as "the provisions of this case") provides for the reduction, exemption, or economic release of taxes;

Since it constitutes "other laws and regulations relating to other measures for tax incentives" for the former promotion, the above provisions shall apply.

tax to be paid by the Plaintiff to China if there was no provision of reduction or exemption; 20% of the original tax rate; and

Amount of tax pursuant to 10%, which is the difference between 10% and 10% after reduction, shall be deducted in Korea under the provisions of this case.

foreign tax amount to be paid directly or deemed to be a foreign tax amount under the latter part of the provision of this case.

In the case of dividend income, the limit shall be 10% of the total dividend amount. The first part of the provision of this case shall apply.

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The latter part of the same paragraph is a provision to confirm the concept of general foreign tax credit.

In itself, for the purpose of foreign tax credit, China's tax exemption regulations exist and are not superior.

deemed to have paid dividends of 10% and thus allowing the deemed foreign tax credit.

As a tax rate regulation, the latter part is not premised on the tax reduction and exemption regulation of the above medical specialist, so that the latter part is "Korea"

For the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income between the Government

Limited tax rates prescribed in Article 10(2)(a) of the Korea-China Tax Treaty (hereinafter referred to as the "Korea-China Tax Treaty").

Without relation to 5%, the amount of tax paid to China shall be deemed 10%. Accordingly, deemed as above.

Foreign payments directly from 10% to the maximum limit prescribed in the latter part of the provisions of this case among the 10% tax amount subject to a tax credit

Article 10 (2) (a) of the Korea-China Tax Treaty, which is subject to tax credit paid by the plaintiff to China

Foreign tax amount equivalent to 5% remaining after deducting the tax amount equivalent to 5% of the applicable limited tax rate, shall be deemed to be paid foreign tax amount.

shall be subject to such credit.

B) The National Tax Service, through a book, etc., "Tax guidance for entering China" in 2008.