early 208west3913 ( November 24, 2010)

A disposition imposing a tax on non-deductible interests regarded as a dividend is legitimate

As a series of procedures for the purpose of securing Korean won currency, the loan transaction and swap transaction were conducted as a series of procedures, and the one party to the loan transaction and the guarantor of the swap transaction are the plaintiff's foreign controlling shareholder, and the non-deductible of the interest regarded as a dividend is defined as all interest income accrued from the loan from a third party who lends money to a domestic corporation under the payment guarantee of the foreign controlling shareholder or foreign controlling shareholder, and its economic substance constitutes interest. Thus, the swap loss of this case constitutes interest which is the cost of using Korean won currency, and thus the disposition imposing the interest regarded as a dividend is legitimate.

2011Guhap5677 Revocation of Disposition of Corporate Tax Imposition

XX Center, Inc.

The director of the tax office

August 18, 2011

October 20, 2011

1. The plaintiff's claim is dismissed.

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

The Defendant’s disposition of imposition of corporate tax of KRW 2,892,477,370 for the business year 2005 against the Plaintiff on September 1, 2008 and the disposition of imposition of corporate tax of KRW 1,214,781,360 for the business year 206 shall be revoked.

1. Details of the disposition;

A. On July 12, 200, the Plaintiff entered into a loan agreement with Singapore, a 100% of the Plaintiff’s shares, from July 12, 2000 (from July 200, to December 12, 2000, acquiring 100% of the Plaintiff’s shares; hereinafter referred to as “ XX”). The Plaintiff entered into a loan agreement with the Plaintiff at the rate of interest rate of 332 billion won from XX, and at July 2003, the repayment date (which last extended the redemption date to July 20, 2015), with the following order of priority borrowing (hereinafter referred to as “the loan transaction in this case”). When meaning individual loan transactions, each sequence is separately indicated.

B. The Plaintiff entered into a contract with financial institutions, such as O (hereinafter referred to as "O, etc.") for currency and interest rate swap transaction (hereinafter referred to as "the swap transaction in this case" and "the transaction through the above contract rate" means "the swap transaction in this case", and each sequence is indicated separately in the case of individual swap transaction) as follows. The Plaintiff guaranteed the payment of all of the funds including the principal, etc. that the Plaintiff is obligated to pay to O, etc. under the swap transaction in this case by other foreign controlling shareholders of △△△△D (hereinafter referred to as "△△△△△"), other than XX, the Plaintiff's foreign controlling shareholder of the Plaintiff in this case (hereinafter referred to as "△△△). The Plaintiff compared and reviewed the loan transaction in this case with the loan transaction in Korea at the time of the loan transaction in this case, determined that the loan in this case requires 11% in case of won currency and 10.4% in case of foreign exchange loan and borrowed funds through the loan transaction in this case and swap transaction

D. The Plaintiff: (1) through the swap transaction in this case, the cumulative amount of the loan transaction in this case: (4) through the swap transaction in this case; (5) through the swap transaction in this case, the cumulative amount of the loan transaction in this case was paid to the O, etc. through the swap transaction in this case; (6) the Plaintiff was paid the cumulative amount of the loan in this case to the O, etc.; and (3) the Plaintiff was paid in Korean currency equivalent thereto (six months thereafter, the Plaintiff was paid interest at the conversion interest rate by the O, etc. and paid to the O, etc. with interest at the fixed interest rate in Korean won; and (4) the difference of the above interest (hereinafter referred to as “the swap loss in this case”) was higher than the interest paid at the interest rate in accordance with the rate of the fixed interest rate in Korean currency that the Plaintiff paid to the O was paid at the rate of interest rate in Korean currency; and (4) the principal amount in Korean currency exchanged with the O, etc. at the time of the swap contract maturity.

This case (2) and (3) The swap transactions are the contents of the other swap transactions in addition to those for which the principal exchange of Korean currency and the United Nations is not made between the Plaintiff and the O, etc.

In this case, the Plaintiff: (2), (3), (4), (4) p.m. loan transactions, regardless of the swap contract at the time of the initial execution of the loan, exchanged into the Korean currency through a foreign exchange bank, and later exchanged into the Korean currency through the swap transaction, and then exchanged into the Korean currency through the swap transaction.

E. The losses from swap in this case that the Plaintiff paid to the O, etc. are as follows.

F. At the time of the declaration of corporate tax at the time of each business year, the Plaintiff: (a) was not included in the deductible expenses for the payer who is considered to be a dividend among the interest rates paid in XX pursuant to Article 14(1) of the former Adjustment of International Taxes Act (amended by Act No. 9914, Jan. 1, 2010; hereinafter “International Tax Adjustment Act”); (b) however, the Plaintiff reported and paid the corporate tax base and tax amount by including the loss from the swap in deductible expenses.

G. The Defendant: (a) considered the Plaintiff’s foreign controlling shareholder’s loan transaction in this case and the swap transaction in this case conducted through the Plaintiff’s guarantee of △△△, a foreign controlling shareholder, as one of the loan transactions in this case; and (b) considered not only the interest paid by the Plaintiff in XX but also the loss in the swap in this case as the interest on the loan to which the under-capital rule under Article 14(1) of the International Tax Adjustment Act applies; and (c) calculated the tax base and tax amount of corporate tax for the business year 2,892,47,370 for the business year 2005 and 2006 and imposed corporate tax for the Plaintiff on September 1, 2008 (hereinafter “disposition”).

[Ground of Recognition] Facts without dispute, Gap's evidence 1, 2, Gap's evidence 3-1, 2, Gap's evidence 4, 5, 6, Gap's evidence 7-1 through 5, Gap's evidence 8-1, 2, Gap's evidence 10-1 through 6, Eul's evidence 10-1, Eul's whole statement, and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The parties' assertion

(1) The defendant's assertion

Since the loan transaction of this case and the swap transaction constitute a single transaction in Korean won loan, which is a single transaction combined with mutual respect for the single purpose of the Plaintiff’s borrowing of Korean won currency. The Plaintiff used the Korean currency through the swap transaction of this case after receiving payment from O, etc. through the exchange transaction of this case and returned Korean currency at the maturity after paying the use price at a certain interval of O, etc., thereby including the borrowing of Korean won currency in the swap transaction of this case. Therefore, the loss from the swap of this case constitutes interest, which is the cost of using Korean currency in economic substance, and thus, the amount of the loss from the swap of this case ought to be applied under the principle

(2) The plaintiff's assertion

The Plaintiff made the swap transaction in this case in order to avoid the risk of exchange rate and interest rate fluctuations in the repayment of the amount of the interest rate at the maturity with the payment of the UN interest rate at XX. The Plaintiff cannot be said to be a loan transaction with the exchange of the United Nations and won in exchange for the purpose of avoiding the risk of exchange rate and interest rate fluctuations. Therefore, the loss from the swap in this case is not an interest on the loan in Korean won, but the loan transaction in this case and the swap transaction in this case cannot be deemed to be a single loan transaction in Korean won because the nature of the loan transaction in this case is entirely different from the form and substance. Therefore, the loss from the swap in this case cannot be deemed to be a single loan transaction in Korean won because the loss from the swap in this case is not subject to the application

(b) Related statutes;

as stated in the Annex Governing Statutes;

C. Determination

살피건대, ㉠ 원고가 실질적으로 원화를 조달하려는 목적으로 일련의 절차로서 이 사건 차입거래와 스왑거래를 하였고 차입거래의 일방당사자와 스왑거래의 보증인이 각각 원고의 국외지배주주인 점, ㉡ 원화를 조달하는 방법으로 당초부터 원화를 차입 한 후 만기에 원화를 반환하는 방법과 외국환을 차입하여 원화로 환전한 후 사용하고 만기에 외국환을 반환하는 방법을 고려할 수 있고 후자의 경우 만기시의 환율변동에 따른 원금(또는 원금 및 만기이자)의 추가지급 위험을 회피하기 위하여 통화 스왑거래를 할 필요성이 있다고 할 수 있지만, 이 사건 스왑거래의 경우 단순히 원금만의 교환이 아니라 원금의 교환(원금 교환이 없었던 거래도 마찬가지이다) 이외에 매 6개월마다 이자율에 대한 교환도 하였는바, 원고가 이와 같은 거래방식을 선택한 주요한 두 가지 이유는 원금 반환시 환율의 변통에 따른 위험회피와 원화 조달시와 외국환 조달시 이자율의 차이에 따른 원화 조달비용을 줄이기 위해서인 것으로 보이는 점, ㉢ 국제조세조정법 제14조의 차입금의 범위는 하위법령에 위입되어 있는바, 국제조세조정법 시행령(2010. 12. 30. 대통령령 제22574호로 개정되기 전의 것, 이하 같다) 제24조 제1항은 그 범위를 이자 및 할인료를 발생시키는 부채로 규정하면서 같은 시행령 제25조 제1항이 손금불산입되는 이자를 내국법인이 국외지배주주 또는 국외지배주주의 지급보증에 의하여 내국 법인에게 금전을 대여하는 제3자에게 지급하여야 할 이자로, 같은 조 제2항이 위 이자를 차입금에서 발생한 모든 이자소득으로서 그 경제적 실질이 이자에 해당하는 것으로 각 정하고 있어 국제조세조청법상의 차입금이 사법상의 차용금을 포함하는 넓은 개념으로 보이는 점, ㉣ 따라서 통화 ・ 이자율 스왑거래가 동시에 이루어진 경우에는 원고가 OO 등으로부터 수령한 원화 상당액(원화 자체가 아닌 만기시 반환할 원화 상당의 외국환을 의미한다)아 부채에, 만기시까지의 이자율 스왑거래에 따라 매 6개월마다 OO 등에게 지급한 스왑차손의 경제적 실질이 이자에 각 해당하고, 통화 ・ 이자율 스왑거래가 별도로 이루어진 경우에는 통화 스왑거래의 상대방(제3의 금융기관)으로부터 수령한 원화 상당액이 부채에, 만기시까지의 이자율 스왑거래에 따라 매 6개월마다 OO 등에게 지급한 스왑차손의 경제적 실질이 이자에 각 해당한다고 봄이 상당한 점, ㉤ 특히 이 사건 처분은 매 6개월마다의 이자율 차이에 따른 스왑차손을 손금불산입한 후 소득처분하는 방법으로 이루어져 앞서 본 이 사건 거래방식을 택한 두 가지 이유 중 주로 후자를 이유로 한 손금에 대한 것인 점, ㉥ 앞서 본 바와 같이 국제조세조정법 시행령 제25조 제1항, 제2항은 배당으로 간주되는 이자로서 손금 불산입되는 것을 국외지배주주 또는 국외지배주주의 지급보증에 의하여 내국법인에게 금전을 대여하는 제3자로부터의 차입금에서 발생한 모든 이자소득으로서 그 '경제적 실질'이 이자에 해당하는 것이라고 명문으로 규정하고 있는 점(따라서 여기서의 이자가 최초 원금 대여자인 XX에 귀속되어야 하거나 반드시 원금 자체에서 발생할 필요가 없다) 등에 비추어 보면, 이 사건 스왑차손을 국제조세조정법 시행령이 규정한 이자라고 볼 수 있으므로 이를 전제로 한 이 사건 처분은 적법하다.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.