early 208west0572 ( December 18, 2008)

Whether the executive bonus has been paid according to the criteria for the payment of benefits

It is difficult to see that bonuses paid to executives are paid in accordance with the standards for payment of benefits determined by the articles of incorporation, the general meeting of shareholders or the resolution of the board of directors.

The contents of the decision shall be the same as attached.

Article 19 (Scope of Deductible Expenses)

Article 20 (Non-Inclusion of Losses from Capital Transactions in Deductible Expenses)

1. The plaintiff's claim is dismissed.

2. The costs of lawsuit shall be borne by the Plaintiff.

The Defendant’s disposition of imposing corporate tax of KRW 3,591,836,320 for the business year of 2005 against the Plaintiff on May 15, 2007 exceeding KRW 33,062,60 shall be revoked.

1. Circumstances of the disposition;

A. On December 30, 2005, the Plaintiff, a company established for the purpose of new construction and sales of apartment-type factories, paid 10 billion won of performance benefits to Kim-won, a co-representative of the co-representative Kim-won (hereinafter "the bonus of this case"), and reported and paid corporate tax for the business year 2005 by including it in deductible expenses.

B. On May 15, 2007, the Defendant deemed the bonus of this case as a bonus from the disposal of profits and excluded the excess appropriation of the sales agency fee from deductible expenses, and notified the Plaintiff company of the correction and notification of the corporate tax of KRW 3,591,836,320 (including additional tax) for the business year 2005 (hereinafter “the disposition of this case”).

C. On January 17, 2008, the Plaintiff Company filed an appeal against the disposition of the instant case with the Tax Tribunal on January 17, 2008, but the Tax Tribunal dismissed the Plaintiff Company’s appeal on December 18, 2008.

[Reasons for Recognition] Facts without dispute, Gap evidence 1, Eul evidence 2, Eul evidence 1 to 10, Eul evidence 8-1 to 5

2. Whether the dispositions of the instant case are legal.

(a)the master of the Plaintiff Company;

1) The instant bonus was paid according to the Plaintiff Company’s resolution of the board of directors on July 3, 2003 and December 29, 2005 and the salary payment criteria determined by the resolution of the general meeting of shareholders on March 3, 2004 and March 27, 2006, and pursuant to Article 43(2) of the Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 21302, Feb. 4, 2009; hereinafter “Enforcement Decree of the Corporate Tax Act”). Thus, the instant bonus constitutes subject to inclusion in deductible expenses under Article 43(2) of the Enforcement Decree of the Corporate Tax Act, and the Defendant’s disposition based on the premise that the instant bonus is subject to inclusion in deductible expenses is unlawful.

2) In the event that the Plaintiff Company pays the instant bonus to Kim-won in accordance with the payment criteria determined by the resolution of the board of directors and the resolution of the general meeting of shareholders as above, it cannot be expected that the Plaintiff Company be expected to be excluded from the deductible expenses of the instant bonus, notwithstanding Article 43(2) of the Enforcement Decree of the Corporate Tax Act, so the Defendant’s imposition of additional tax

(b) relevant statutes;

It is the same as the entry of the attached statutes.

C. Determination

1) To make the first proposal of the Plaintiff Company as the first proposal

A) According to Articles 19(1) and (3) and 20 subparag. 1 of the Corporate Tax Act (amended by Act No. 9267 of Dec. 26, 2008; hereinafter “Corporate Tax Act”) and Articles 20(1)4 and 43(2) of the Enforcement Decree of the Corporate Tax Act, the disposal of surplus earnings shall not be included in deductible expenses, in principle, inasmuch as the disposal of surplus earnings does not fall under deductible expenses in its concept. However, in exceptional cases, it may be included in deductible expenses, on the basis that a domestic corporation agreed in writing with the employee in advance on the performance calculation index and goals thereof, performance measurement and distribution method, etc., and accordingly, it can be included in deductible expenses, among bonuses paid by the corporation to its executives, only the amount paid according to the standards for payment of wages determined by the articles of incorporation, the general meeting of shareholders, the general meeting of partners, or the resolution

B) However, in full view of the following circumstances, Gap evidence 3 through 9, Eul evidence 2-1 through 9, Eul evidence 3, Eul evidence 4, Eul evidence 5-2, Eul evidence 5-1, Eul evidence 6-1, Eul evidence 7, Eul evidence 8-1 through Eul evidence 8-5, and Eul evidence 8-1 to examine the whole purport of the argument, it is recognized that the plaintiff company did not have the criteria for the payment of benefits determined by the articles of incorporation, the general meeting of shareholders or the resolution of the board of directors at the time of paying the bonus of this case to the joint representative Kim Do-won, a joint representative director of the interest of shareholders, the plaintiff company in this case should be deemed to have disposed of surplus funds in the process of devolving the profits accrued in the business year 205 under the name of performance payment, without specific and objective benefit payment criteria. Thus, the bonus of this case is not subject to losses under Article 43(2) of the Enforcement Decree of the Corporate Tax Act.

1) The articles of incorporation of the Plaintiff Company provides that the remuneration for officers shall be determined by the resolution of the board of directors (Article 33), and the regulations on bonuses of executives shall not exist.

2) 원고 회사는 세무조사 당시인 2007. 2. 26. 서울지방국세청 소속 세무공무원으로부터 이 사건 상여금 지급과 관련된 급여규정과 이사회 및 주주총회 의사록 등의 제출요구를 받았음에도 불구하고, 세무공무원에게 위 각 서류를 제출하지 못하다 가, 나중에서야 비로소 세무대리인 김★★를 통하여 세무공무원에게 이 사건 상여금 지급과 관련된 2003. 7. 1.자 급여규정과 위 급여규정을 승인한 2003. 7. 3.자 이사회 의사록 및 2004. 3. 3.자 정기주주총회 의사록, 그리고 이 사건 상여금을 승인한 2005. 12. 29.자 이사회 의사록 및 2006. 3. 27.자 정기주주총회 의사록을 각 제출하였다. 그런데 실질적인 분양사업을 총괄지휘하는 임원에 한하여 다른 임직원이 할 수 없는 사업시행에 성공할 경우 그 실적에 따라 이사회 결의로 다음의 실적급여 조견표를 한도로 실적급여를 지급할 수 있다 고 규정하고 있는 위 급여규정은 실적급여의 지급대상 등에 관하여 구체적이고 객관적인 지급기준을 정한 것으로 보기 어렵고, 위 이사회 의사록과 정기주주총회 의사록에는 모두 이사회와 주주총회에 출석한 바 없는 감사 문AA이 출석한 것으로 기재되어 있으며, 위 이사회 의사록에는 이사회에 출석한 바 없는 문AA의 인장이 날인되어 있다.

3) 김★★는 2007. 3. 30. 세무공무원으로부터 세무조사 당시 제출하지 못하다가 나중에 보완하여 가지고 온 위 이사회 의사록 및 정기주주총회 의사록은 모두 사후에 형식적으로 작성된 것으로 보이는바, 보완된 서류의 작성경위를 설명하여 달라 는 질문을 받고 난 후 이에 대한 답변을 하지 못한 바 있고, 김☆☆은 2007. 4.경 서울 지방국세청 소속 세무공무원에게 원고 회사가 정관 규정 또는 주주총회ㆍ이사회의 승인 없이 2005. 12. 30. 대표이사 김☆☆에게 성과급여 명목으로 100억 원의 특별상여금을 지급하였음을 확인합니다 라는 내용의 확인서를 작성하여 제출한 바 있다.

4) The Plaintiff Company presented a list of bonus payment of KRW 5 billion in the process of filing an objection, which is a procedure of the previous trial in this case, to Kim Do-won, stating that the special bonus payment of KRW 5 billion shall be paid to Kim Do-won, and the KRW 5 billion in the bonus of this case shall be paid to Kim Do-won in accordance with the articles of incorporation, the general meeting of shareholders, or the resolution and the board of directors' reimbursement regulations. Thus, the Plaintiff Company asserted that the above KRW 5 billion in the bonus of this case should be recognized as losses. However, the Plaintiff Company did not make a consistent assertion that the entire bonus of this case was paid to Kim Do-won in accordance with

5) On the Plaintiff Company’s list of shareholders, 49% of the shares of the Do governor Kim 49% of the shares at the time of establishment, 20% of the shares of the Do governor 20% of the shares, 20% of the shares of the Do governor 20% of the shares, and Do governor Do governor 5% of the shares of the shares. On December 2005, Do governor Do governor was registered as acquiring all shares of the Do governor Do governor Do governor Do governor Do, but all the above shares held by other shareholders of Do governor Do

6) The total amount of the benefits in 2005, Kim-young, Kim-young, a half of KRW 120,000,000,000,000,000,000,000,000,000 won, and the amount of the bonus in this case, shall be 14,134,160,000,000 won

C) Therefore, this part of the Plaintiff Company’s assertion on a different premise is without merit.

2) The second proposal of the Plaintiff Company is replaced by the second proposal.

As seen earlier, since the bonus in this case is not paid in advance according to the criteria for the payment of benefits determined by the articles of incorporation, the general meeting of shareholders or the resolution of the board of directors, it does not constitute the subject of inclusion in deductible expenses. There is no evidence to find the existence of justifiable grounds that the Plaintiff Company cannot expect the inclusion in deductible expenses of the bonus in this case. Thus, this part of the Plaintiff Company’s assertion on other premise is without merit

3. Conclusion

The plaintiff company's claim for a case shall be dismissed because there is no reason.