Whether transfer margin accruing from a non-profit domestic corporation is subject to the special surtax of corporate tax.

Even in cases where the transfer margin accruing from the transfer of land, etc. by a non-profit domestic corporation does not fall under the income accrued from the profit-making business or income under each subparagraph of Article 1 (1) of the Corporate Tax Act, and thus is not subject to the corporate tax on the income for each business year of the relevant corporation, such transfer margin shall be subject to the special surtax, which is a separate corporate tax provided for in Articles 1 (5) and 59-2 of the Corporate Tax Act, except for the cases where the transfer margin falls

Articles 1(1), 1(5), 59-2, and 59-3 of the Corporate Tax Act

Supreme Court Decision 80Nu455 Delivered on October 26, 1982

dong Educational Foundation (Attorney Labor-at-law, Counsel for defendant-appellant)

Head of Seogsan Tax Office

Daegu High Court Decision 81Gu153 delivered on June 15, 1982

The appeal is dismissed.

The costs of appeal are assessed against the plaintiff.

The Plaintiff’s attorney’s ground of appeal is examined.

In case where a non-profit domestic corporation takes gains from the transfer of land, etc. under Article 59-2 of the Corporate Tax Act, even if the gains from the transfer do not fall under the income accrued from profit-making business or income under each subparagraph of Article 1(1) of the same Act and thus is not subject to corporate tax on income for each business year of the corporation, it shall be interpreted that the gains from the transfer are subject to corporate tax, which is a separate corporate tax under Articles 1(5) and 59-2 of the Corporate Tax Act, except for the case where the gains from the transfer fall under or are subject to non-taxable income under Article 59-3 of the Corporate Tax Act (Article 80Nu455 delivered on October 26, 1982). Contrary to the above opinion, among the corporations provided that Article 1(5) of the Corporate Tax Act provides that it is liable to pay the special surtax as corporate tax, the remaining non-profit domestic corporation shall not be deemed included in the corporate tax, and thus, the court below erred in its interpretation of interpretation.

Therefore, the appeal is dismissed and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Yoon Il-young (Presiding Justice)