URL copied successfully.
Press CTRL+V or paste display URL.
| Article 17 (Dividend Income) |
| (1) | The dividend income shall be the following incomes accruing in the current year: <Amended by Act No. 6557, Dec. 31, 2001; Act No. 7006, Dec. 30, 2003> |
| 1. | Dividends or shares of any profits or surplus received from a domestic corporation, and dividends of the interest during construction as prescribed in Article 463 of the Commercial Act; |
| 2. | Dividends or shares received from an organization considered as corporation; |
| 3. | Fictitious dividends; |
| 4. | Amounts disposed as dividend under the Corporate Tax Act; |
| 5. | Shares of proceeds from investment trusts received at home (referring to the investment trust cum dividend); |
| 6. | Dividends or shares of any profits or surplus received from a foreign corporation, and dividends of the interest during construction as prescribed by the laws of such foreign country, and dividends of the similar nature; and |
| 7. | Incomes similar to those under subparagraphs 1 through 6, which bear a nature of profit distribution. |
| (2) | The fictitious dividends as referred to in paragraph (1) 3 shall mean the following amounts, and shall be considered to have been paid to the stockholders, employees and other investors: <Amended by Act No. 5580, Dec. 28, 1998; Act No. 6557, Dec. 31, 2001; Act No. 7319, Dec. 31, 2004> |
| 1. | Amount of money or value of other property acquired by a stockholder due to a retirement of stocks or reduction of capital, or by an employee or investor due to retirement or withdrawal from a company or reduction of investment, which exceeds the amount disbursed by the stockholder, employee or investor for acquiring the stocks or investment; |
| 2. | Value of the stocks or amount of investment acquired by a corporation resulting from transferring the whole or part of a corporation’s surplus funds to capital or investment: |
| (a) | The capital reserve fund (not including the marginal gain accruing from evaluation of corporations undergoing merger or from evaluation of dividing companies under the conditions as prescribed by the Presidential Decree; with respect to gain on the retirement of treasury stocks or treasury shares, it shall be limited to those transferred into the capital after two years have elapsed from the date of retirement, in case where the market price under Article 52 (2) of the Corporate Tax Act at the time of retirement does not exceed the acquisition price; and with regard to the issuance of treasury stocks or treasury shares through debt-equity swap, it shall be limited to the amount left after the subtraction of their par value from their market price, in case where the market price of such stocks or investment shares is not less than their par value and not more than their issuing price) under Article 459 (1) 1 through 3 and 3-2 of the Commercial Act; and |
| (b) | Revaluation reserve fund in accordance with the Assets Revaluation Act (not including the amount equivalent to the revaluation excess of land under Article 13 (1) 1 of the same Act); |
| 3. | Amount of money and value of other property acquired by a stockholder, employee, investor or member of a dissolved corporation (including any organization considered as a corporation), as a share of the remaining assets due to dissolution of the corporation, which exceeds the amount disbursed for acquiring the stocks, and investment or capital; |
| 4. | The sum of money and value of stocks or investment acquired due to a merger, by a stockholder, employee or investor of a corporation extinguished by the merger, from a corporation continuing to exist after the merger or established newly due to the merger, which exceeds the amount disbursed for acquiring the stocks or investment of the corporation extinguished by the merger; |
| 5. | Where the ratio of stockholding of stockholders other than the corporation concerned is increased due to the capital transfer under each item of subparagraph 2 in such status that the corporation retains the treasury stocks or treasury shares, the value of the stocks equivalent to the increased ratio of stockholding; and |
| 6. | The amount by which the total sum of price of stocks, money, and other asset values (hereinafter referred to as the “price of division”) which are gained by the stockholder of a corporation which is divided when a corporate division occurs (hereinafter referred to as a “divided corporation”) or by the stockholder of an extinguished party of a merger by division, through division from a corporation established as a result of division or from the other party of the merger by division, exceeds the amount disbursed in acquiring the stocks of the divided corporation or the extinguished party of the merger by division (limited to the stocks which are decreased due to their retirement, etc., if the divided corporation continues to exist). |
| (3) | The dividend income amount shall be the total gross income amount in the current year: |
| (3) | The dividend income amount shall be the total gross income amount in the current year: |
| 1. | Fictitious dividend resulting from capitalizing the marginal profit on retirement of treasury stocks or treasury shares under paragraph (2) 2 (a); |
| 2. | Fictitious dividend resulting from capitalizing the marginal profit on revaluation of land under paragraph (2) 2 (b); |
| 3. | Fictitious dividends under the provisions of paragraph (2) 5; and |
| 4. | Where there is a dividend income from a corporation prescribed by the Presidential Decree from among corporations which are given a non-taxation/exemption/reduction and exemption or income deduction of the corporate tax to which the minimum tax under Article 132 of the Restriction of Special Taxation Act does not apply (including a non-taxation/exemption/reduction and exemption or income deduction pursuant to other Acts than the Restriction of Special Taxation Act), the amount which derives from multiplying the amount of the dividend income by the rate prescribed by the Presidential Decree. |
| (4) | In applying the provisions of paragraph (2) 1, 3, 4 and 6, in cases where the amount spent for acquiring stocks or investment is not clear, their par value or investment amount shall be considered the amount spent for their acquisition. <Added by Act No. 6292, Dec. 29, 2000> |
| (5) | In applying the provisions of paragraph (2), matters necessary for the assessment of the price of stocks and investment shares shall be determined by the Presidential Decree. <Added by Act No. 5580, Dec. 28, 1998; Act No. 6051, Dec. 28, 1999> |
| (6) | Matters necessary for the dividend income under the provisions of each subparagraph of paragraph (1) and the scope of dividend income amount under the provisions of paragraph (3) shall be prescribed by the Presidential Decree. <Added by Act No. 7006, Dec. 30, 2003> |