The business year of bad debts

In full view of Articles 9(3) and 17(1) of the Corporate Tax Act, Article 12(2)8, Article 21 of the Enforcement Decree of the same Act, and Article 9(2) of the Enforcement Decree of the same Act, the types of bad debt can be classified into cases where corresponding claims are legally extinguished and where legally extinguished, but the former is unable to recover assets in light of the debtor's asset status, payment ability, etc., and the former is naturally impossible. Therefore, the former is included in deductible expenses for the business year in which the date when the corporation becomes unable to recover assets due to bad debt, and the latter is included in deductible expenses for the business year in which the date when the corporation becomes unable to dispose of the assets due to bad debt. Since the latter exists in itself, it can be included in deductible expenses for the business year in the tax accounting only when the corporation handles the account that the bad debt occurred due to a clear impossibility of recovery.

Articles 9(3) and 17(1) of the Corporate Tax Act; Article 12(2)8 and 21 of the Enforcement Decree of the Corporate Tax Act; Article 9(2) of the Enforcement Rule of the Corporate Tax Act

Samsung Publishing Co., Ltd., Ltd., Counsel for defendant-appellee

Head of the tax office;

Seoul High Court Decision 85Gu907 delivered on April 16, 1987

The part of the judgment below against the plaintiff shall be reversed and remanded to the Seoul High Court.

The defendant's appeal is dismissed.

The costs of litigation incurred by the defendant's appeal shall be borne by the defendant.

1. As to the ground of appeal by the Plaintiff’s attorney:

Article 9(3) of the Corporate Tax Act, Articles 12(2)8 and 21 of the Enforcement Decree of the same Act, Article 9(2) of the Enforcement Decree of the same Act, and Article 17(1) of the same Act are analyzed and integrated. The form of bad debt can be divided into cases where the corresponding claim is legally extinguished and legally extinguished, but it is not possible to recover assets in light of the debtor's ability to pay assets. The former is naturally impossible to recover. Thus, the former is included in deductible expenses for the business year in which the date when the corporate accounting process is extinguished, and the latter is included in deductible expenses for the business year in which the date when the corporate accounting process is extinguished. Since the creditor exists as it is, it is reasonable to view that it can be included in deductible expenses for the pertinent business year only when the corporate accounting process is carried out because it is clearly impossible to recover and that bad debt was generated.

The court below determined that the claim for recovery of the real estate purchase price of this case against the non-party company is a bad debt under Article 21 subparagraph 1 of the Enforcement Decree of the Corporate Tax Act at the time of the successful bid or disposal of deficit, since the claim for recovery of the real estate purchase price of this case is a bad debt under Article 21 subparagraph 1 of the Corporate Tax Act at the time of disposal of deficit, even if it can be included in the deductible expenses for the business year from July 1, 1983 to June 30, 1983, since it can be said that the claim for recovery of the real estate purchase price of this case, which was presented by the court below, is obviously extinguished under the law, and it can not be viewed that the claim for recovery of the real estate purchase price of this case from the date of disposal of the real estate of this case to the date of disposal of the above auction or disposal of deficit, and it can be viewed that the claim for recovery of the real estate price of this case was no more than the deductible expenses of this case from the date of disposal of the real estate of this case.

If so, the court below erred in the misapprehension of the legal principles as to bad debts and affected the judgment by misunderstanding the time of attribution of deductible expenses, and there is a reason to misunderstanding this point, and the judgment of the court below on this part is not reversed.

2. As to the Defendant’s ground of appeal

According to the records, it is evident that the defendant did not state the grounds for appeal while submitting a petition of appeal, and it does not submit the appellate brief until 20 days have passed since the notice of receipt of the records of appeal was served. Thus, the defendant's appeal shall not

3. Accordingly, the part against the plaintiff among the original judgment shall be reversed, and that part of the case shall be remanded to the court below for a new trial and determination, and the defendant's appeal shall be dismissed, and it is so decided as per Disposition with the assent of all participating judges.

Justices Kim Yong-ju (Presiding Justice)