The legal nature of retirement consolation benefits for the officers of the company

If an officer of a corporation retires due to the expiration of his/her term of office, the retirement consolation benefits paid to him/her according to the retirement consolation benefits provisions which have already been enacted by the internal rules of the company with the resolution of the general meeting of shareholders is the necessary expenses of the company so-called company as remuneration for officers under Articles 38

(Gu) Articles 19 and 45 of the Corporate Tax Act, Articles 388 and 415 of the Commercial Act

On November 22, 1977, 77Da1742 decided Nov. 22, 197 (Supreme Court Decision 11631; Supreme Court Decision 253Du320 decided Nov. 20; Decision 388(3)742 of the Commercial Act; Court Gazette 577No 10514 decided Nov. 2, 197)

Plaintiff, Ltd.

East Incheon National Tax Affairs Office

The Defendant’s disposition of occasional corporate tax of KRW 3,091,985 against the Plaintiff on December 23, 1965, which exceeds KRW 341,348,00,00,000, shall be revoked.

Litigation costs shall be borne by the defendant.

The same shall apply to the order.

1. The defendant imposed corporate tax of KRW 3,091,985 on the plaintiff from time to time in 1965, and there is no dispute between the parties, and Gap evidence Nos. 3, 4, 9, 199, and witness Nos. 7, 9-1, 9-3, and the testimony of the above witness No. 7, 8, and 9-1, 4, 1964, 197, 197, 197, 40, 197, 197, 4, 1967, 50, 197, 197, 197, 197, 196, 196, 3, 4, 5, 5, 7, 8, and 1965, 50, 197, 196, 196, 30, 196, 165, 360, 196, 4, 167,

2. The plaintiff is just in the payment of retirement consolation benefits as long as the director, non-party 2 and 8, who were retired at the expiration of the term of office, and the above retirement consolation benefits were paid in front and rear, and it cannot be viewed as a bonus for executive officers. Furthermore, the non-party 11 is not a shareholder or executive, but a director, who resigned on December 10, 1965, and the non-party 3 is arguing that the payment of retirement consolation benefits is unfair. Accordingly, the defendant is the payment of retirement consolation benefits to the person who actually retires on the ground that the disposition of this case is legitimate. In this case, the defendant is the payment of retirement consolation benefits to the person who actually retires on the day following the expiration of the term of office. If all of the following days are reappointed, the retirement consolation benefits are paid in the form of form, and the nature of bonus continues, and the non-party 11 is a shareholder whose name is recorded in the register of shareholders.

3. In this case, if a director or an auditor who is an officer of a stock company retires due to the expiration of the term of office as stipulated in the articles of incorporation, he shall obtain the resolution of the general meeting of shareholders and receive retirement consolation benefits which are already paid to him pursuant to the provisions of the retirement consolation benefits which are established by the internal rules of the company, shall be treated as necessary expenses of the so-called company for corporate taxation. Even if such officer is reappointed after his retirement, this is merely a case where the delegation relation with the officer of the company is again entrusted by the company after the expiration of the delegation period, so he cannot be treated as a bonus not for the already terminated delegation relation. However, this case's retirement consolation benefits cannot be treated as 16 times the total amount of retirement consolation benefits for the purpose of evading corporate tax (this case's retirement consolation benefits shall be considered as 196 times the total amount of retirement consolation benefits for the purpose of this case's final settlement period after the end of the pertinent business year, and it shall be considered as 15 times the amount of retirement consolation benefits for each officer.

4. In addition, since there is no ground to interpret that retirement consolation benefits received by Nonparty 11 upon resignation as an executive officer of the Plaintiff Company is a bonus solely on the ground that he/she is a shareholder of the Plaintiff Company, the Defendant’s assertion that he/she is a bonus to this person is without merit.

5. If so, the retirement consolation benefits for the above non-party 2 and 8 and the retirement consolation benefits for the non-party 11 are included in the gross income and the disposition imposing corporate tax thereon is unlawful. The tax amount is calculated in accordance with Article 19(1) and (2) of the Corporate Tax Act (Act No. 1489 of December 13, 1963) and Article 45(1) of the same Act (Act No. 1186 of November 28, 1962), and Article 19-2(1) of the Enforcement Decree of the same Act (Ordinance No. 1100 of December 29, 1962), and Article 19-2(1) of the same Act (Ordinance No. 1100 of December 29, 196), and it is clear that the above amount would be 2,750,637 won 】 (30/600 x 30/100 x 194), 197/194).7

6. Therefore, the plaintiff's hearing is justified and the costs of lawsuit are assessed against the losing party. It is so decided as per Disposition.

Judges Kim Young-ju (Presiding Justice) Lee Chang-joon