Whether it constitutes earned income of profit from exercising stock options (stock options)

The Stockholm option exercising profit is an economic benefit that an employee receives from an employer and is in a quid pro quo relationship based on a certain correlation or economic rationality with the labor provided by the employee.

Article 20 of the Income Tax Act

Article 38 (Scope of Labor Incomes)

1. The appeal is dismissed.

2. The costs of appeal are assessed against the Plaintiff.

The grounds of appeal are examined.

1. As to the ground of appeal Nos. 1, 2, and 5

Wage and salary income under Article 20 (1) of the Income Tax Act, regardless of its payment form or name, includes not only the provision of labor and all economic benefits in a quid pro quo relationship by nature, but also the benefits that form the contents of working conditions closely related to the provision of labor on the premise of labor (see, e.g., Supreme Court Decision 2007Du1415, Oct. 25, 2007).

According to the reasoning of the lower judgment, the lower court: (a) entered ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○”) on November 31, 2002 and worked as regular or non-regular employees until July 1, 2002; (b) on April 13, 1994, the Plaintiff did not have an indirect relationship between the Plaintiff and the Plaintiff’s ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○.).

The judgment below to the same purport is just, and there is no error in the misapprehension of legal principles as to the nature of profit from exercising stock option, or in the misapprehension of legal principles as to wage and salary income under Article 20 (1) of the Income Tax Act, or

2. As to the third ground for appeal

In order to ensure that income subject to income tax has been realized, even if it is unnecessary until it is realized, the income should be considerably mature and confirmed in the possibility of realizing the income, and it is merely established without reaching such a degree (see, e.g., Supreme Court Decision 2001Du7176, Dec. 16, 2003). The stock option is entirely entrusted to the choice of the officer or employee granted the stock option, so it cannot be deemed that any income has accrued merely by the granting of the stock option, and only by the exercising of the stock option, it shall be deemed that the income has accrued.

The court below's determination that the profit of exercising stock options in this case constitutes earned income in the taxable period to which the time of exercising stock options belongs is just in accordance with the above legal principles, and there is no error of law such as misunderstanding of legal principles as to

3. As to the fourth ground for appeal

Article 24 (2) of the Income Tax Act provides that the income amount shall be calculated on the basis of the price at the time of transaction when the transaction is made. Thus, the court below's calculation of the income from exercising the stock option of this case by converting the difference between the price of exercising the stock option and the price of exercising the stock option at the market price as of the date of exercising the stock option is justifiable as it is in accordance with the above provision. There is no violation of

4. Regarding ground of appeal No. 6

Under the tax law, where a taxpayer violates various obligations, such as a return and tax payment, without justifiable grounds, in order to facilitate the exercise of the right to impose taxes and the realization of a tax claim, an additional tax is an administrative sanction imposed as prescribed by the Act, and the taxpayer’s intentional or negligent act does not constitute a justifiable cause not attributable to the breach of duty (see, e.g., Supreme Court Decisions 2001Du4689, Nov. 13, 2002; 2002Du10780, Jun. 24, 2004).

In the same purport, the court below is just in holding that the plaintiff erred in the misapprehension of the legal principle as to additional tax, even though the profit from the Stockholm option exercise of this case did not constitute income subject to taxation, it is just in holding that the plaintiff's neglect of payment obligation is not a legitimate ground for the plaintiff's neglect of payment obligation, and there is no error in the misapprehension of the legal principle as to additional tax, as otherwise alleged in the ground of appeal.

The Supreme Court precedents cited in the grounds of appeal cannot be invoked in this case due to different cases.

5. Therefore, the appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.