Land transaction management department-71 (Law No. 18, 2010)

Transfer

In principle, the transfer value and acquisition value of assets abroad are based on actual transaction value and are included in the transfer value and acquisition value, and the conversion, etc. of gains from transfer into foreign currency is calculated based on the basic exchange rate or fiscal exchange rate under the Foreign Exchange Transactions Act as of the date of receipt or payment of transfer value

The transfer value and acquisition value of assets abroad under Article 118-2 of the Income Tax Act shall, in principle, be based on the actual transaction value (referring to the actual transaction value between the transferor and transferee), and in the case of inquiry, loans shall be included in the transfer value and acquisition value. The conversion, etc. of gains on transfer into foreign currency shall be based on the basic exchange rate or arbitrated exchange rate under the Foreign Exchange Transactions Act as of the date of receipt or payment of transfer value and necessary expenses under Article 178-5 (1)

Article 118-4 of the Income Tax Act (Calculation of Necessary Expenses in Transfer Income)

* Related reference materials

1. A summary of the contents of inquiry;

○ Facts

- Acquisition of housing of Washington on March 2007 (domestic capital 450,000,00GD, local loans 1,050,000,00GD)

- Singapore on September 2009, 470,000GD for domestic financing, 1,050,000 SGD for loan repayment

-The base exchange at the time of its acquisition shall be 610 won, 860 won at the time of its transfer.

○ Contents of questioning

-the place where the transfer income tax is calculated, including the conversion marginal profits accruing from the repayment after the borrowing of local acquisition funds;

2. Materials on the contents of questioning;

(a)related tax laws and regulations (law, enforcement decree, enforcement decree, basic rules);

○ Article 118-4 of the Income Tax Act 【Calculation of Necessary Expenses in Transfer Income】

(1) omitted.

(2) Matters necessary for currency exchange of gains on transfer, actual transaction price disbursed for the acquisition, and calculation of market price under paragraph (1) shall be determined by Presidential Decree.

【Foreign currency conversion of gains from transfer】

(1) In calculating gains on transfer under Article 118-4 (2) of the Act, the calculation shall be based on the basic exchange rate or arbitrated exchange rate under the Foreign Exchange Transactions Act as of the date when the transfer value and necessary expenses are received or disbursed.

(2) omitted.

(b) relevant established rules (established rules, interpretation cases, review, adjudication, judicial precedents);

○ Property Tax and -398, and 02.04.

The transfer value and acquisition value of overseas assets referred to in Article 118-2 of the Income Tax Act, in principle, shall be based on the actual transaction value (referring to the actual transaction value between the transferor and transferee), and in the case of inquiry, loans shall be included in the transfer value and acquisition value. The conversion, etc. of gains on transfer into foreign currency shall be calculated based on the basic exchange rate or arbitrated exchange rate under the Foreign Exchange Transactions Act as of the date of receipt or payment of transfer value and necessary expenses under Article 178-5