Open Decision Ledger · Tax & international taxation
Warrant securities gains outside the gift tax scope set by Article 40
Supreme Court, Apr. 12, 2024, 2022Du62208 (judgment)
No holding summary · checked against points at issue. The official text publishes no summary of the holding for this decision. The quotation and factors in this record are copied verbatim from the points at issue; the evidence for each axis is taken from the points at issue, the order and the reasons.
Case name: 증여세부과처분취소
Official text on the National Law Information Center
Question
Does Article 40(1)(2)(b) of the former Inheritance and Gift Tax Act, by requiring a special relationship between the shareholder and the issuing corporation and acquisition from that corporation or an underwriter, set the boundaries of gift tax so that a gain from a transaction outside that scope cannot be taxed, and is Article 4(1)(vi) of the same Act a separate provision bringing such excluded transactions back into the tax?
Holding
It does. Article 40(1)(2)(b) of the former Inheritance and Gift Tax Act does not govern every gain from converting bonds into shares; it requires a special relationship between the shareholder who subscribed or acquired the bonds and the issuing corporation, and acquisition from that corporation or an underwriter under Article 9(12) of the Capital Markets Act, and so limits the taxable subject and scope and sets the boundaries of gift tax. A gain from a transaction left outside that scope, such as warrant securities not taken from the issuing corporation or an underwriter, cannot be taxed under Article 2(vi) of the Act unless a separate provision brings it into the tax or other special circumstances exist. Article 4(1)(vi) is not such a provision: it applies the individual valuation provisions by analogy where the economic substance of a transaction is similar, to meet irregular gifts that shift wealth without consideration by new financial techniques or capital transactions.
Points at issue, verbatim
구 상속세 및 증여세법 제40조 제1항 제2호 (나)목은 전환사채 등을 인수·취득한 주주와 발행 법인 간에 특수관계가 존재하고, 아울러 발행 법인 또는 자본시장과 금융투자업에 관한 법률 제9조 제12항에 따른 인수인으로부터 전환사채 등을 인수·취득하는 등의 요건을 정하여 과세대상과 과세범위를 한정함으로써 증여세 과세의 범위와 한계를 설정한 것인지 여부(적극)
Unofficial English translation
Whether Article 40 (1) 2 (b) of the former Inheritance Tax and Gift Tax Act, by establishing requirements such as that a special relationship exists between the shareholder who has subscribed for or acquired convertible bonds, etc. and the issuing corporation, and that the convertible bonds, etc. are subscribed for or acquired from the issuing corporation or from an underwriter as defined in Article 9 (12) of the Financial Investment Services and Capital Markets Act, and by thus limiting the taxable subject and the scope of taxation, set the scope and limits of gift tax taxation (affirmative)
Disposition
Dismissed Stated in the decision
상고를 기각한다. 상고비용은 피고가 부담한다.
Unofficial English translation
The appeal is dismissed. The costs of the final appeal shall be borne by the defendant.
Form of the test
Elements stated Stated in the decision
이 사건 조항은 전환사채 등의 주식전환 등에 따른 모든 이익을 증여세 과세대상으로 규율한 것이 아니라, 전환사채 등을 인수·취득한 주주와 발행 법인 간에 특수관계가 존재하고, 아울러 발행 법인 또는 자본시장법 제9조 제12항에 따른 인수인으로부터 전환사채 등을 인수·취득하는 등의 요건을 정하여 과세대상과 과세범위를 한정함으로써 증여세 과세의 범위와 한계를 설정한 것으로 보아야 한다.
Unofficial English translation
The provisions at issue in this case did not regulate all gains arising from the conversion of convertible bonds, etc. into shares as subjects of gift tax taxation; rather, it must be regarded that they established requirements such as that a special relationship exists between the shareholder who has subscribed for or acquired convertible bonds, etc. and the issuing corporation, and that the convertible bonds, etc. are subscribed for or acquired from the issuing corporation or from an underwriter as defined in Article 9 (12) of the Financial Investment Services and Capital Markets Act, and by thus limiting the taxable subject and the scope of taxation, set the scope and limits of gift tax taxation.
Factors
- 전환사채 등을 인수·취득한 주주와 발행 법인 간에 특수관계가 존재하고
- 발행 법인 또는 자본시장과 금융투자업에 관한 법률 제9조 제12항에 따른 인수인으로부터 전환사채 등을 인수·취득하는 등의 요건을 정하여 과세대상과 과세범위를 한정함으로써 증여세 과세의 범위와 한계를 설정한 것인지 여부(적극)
- 개별 가액산정규정이 설정한 증여세 과세의 범위와 한계에 들어맞지 않아 증여세 과세대상에서 제외되는 거래·행위도 특별히 과세대상으로 삼기 위한 별도의 규정인지 여부(소극)
Unofficial English translation
• a special relationship exists between the shareholder who has subscribed for or acquired convertible bonds, etc. and the issuing corporation, and
• whether, by establishing requirements such as that the convertible bonds, etc. are subscribed for or acquired from the issuing corporation or from an underwriter as defined in Article 9 (12) of the Financial Investment Services and Capital Markets Act, and by thus limiting the taxable subject and the scope of taxation, the scope and limits of gift tax taxation were set (affirmative)
• whether Article 4 (1) 6 of the former Inheritance Tax and Gift Tax Act is a separate provision intended to specially make transactions or acts taxable that fall outside the scope and limits of gift tax taxation set by the individual valuation provisions and are therefore excluded from the subjects of gift tax taxation (negative)
Relation to precedent
Follows earlier decisions Stated in the decision
대법원 2015. 10. 15. 선고 2013두13266 판결 참조
Unofficial English translation
See Supreme Court Decision 2013Du13266 decided October 15, 2015
Decisions referred to
해당 본문 참조
Burden of proof
Not addressed Not in the decision
Open question and revisit condition
Where a gain from warrant securities sold by an officer of the issuing corporation is left outside Article 40(1)(2)(b) and cannot be taxed under Article 4(1)(vi), what provision, if any, could tax it, and how would its economic substance be weighed against the gift profit under Article 40(1)(i)(a) of the former Act?
Any amendment to Article 40(1)(2)(b) of the former Act or to Article 4(1)(vi) of the same Act, or any new provision expressly taxing gains from transactions excluded by the individual valuation provisions, would require this entry to be read again. A later decision addressing the economic-substance ground on the sale by Outsider 1, which the Court did not reach, would also change the reading.
Cross-family AI independent reading & axis check
8 of 8 axes matched GPT-6 Astra (OpenAI, codex CLI) · 2026-10-25
A reader from another model family (GPT-6 Astra), given the official text but not the primary reading, agreed on all 8 axes.
Raw responses and comparison record: Protocol · Blind readings (JSONL) · Axis comparison (JSONL) · SHA-256 (JSON)
Lower-court contrast & scope of application
Lower-court reading vs. Supreme Court holding
Lower-court context: The Seoul High Court, in its judgment of 21 September 2022 (2021Nu36334), held that the gain could not be taxed under Article 4(1)(vi) of the former Inheritance and Gift Tax Act. The dispute arose from the defendant's reassessment of 1 May 2018, which recalculated the benefit the plaintiff obtained by exercising warrant securities under Article 40(1)(2)(b); at first instance the defendant had added an alternative ground, applying that same provision by analogy under Article 4(1)(iv) and (vi).
Supreme Court standard: The Supreme Court found no error affecting the result. It held that although some passages of the appellate reasons were inappropriate, the conclusion was proper, because transactions left outside the taxable subject and scope of Article 40(1)(2)(b) cannot be taxed under Article 4(1)(vi), even though the gain might have fallen under Article 42(1)(iii) first sentence of the Inheritance and Gift Tax Act before the amendment of 15 December 2015 (Law No. 13557), since that provision was deleted. A ground on whether the gain resembled the gift profit under Article 40(1)(i)(a) was raised for the first time on appeal and was not a lawful ground, and the remaining grounds could not affect the outcome, so the tax authority's appeal was dismissed and the tax authority bore the costs.
Distinguishing conditions
- A gain arising from bonds or warrant securities subscribed or acquired from the issuing corporation or an underwriter under Article 9(12) of the Capital Markets Act, which sits inside the taxable scope the provision sets.
- A transaction that another statutory provision expressly brings into the gift tax, or other special circumstances of that kind, since the Court made its exception subject to them.
- A gain arising under a different individual valuation provision, such as Article 40(1)(i)(a) of the same Act, which the decision did not examine.
Record verification notes
Check which version of the former Inheritance and Gift Tax Act governs, since this decision applied the version in force between the amendment of 15 December 2015 (Law No. 13557) and the amendment of 20 December 2016 (Law No. 14388), and remember that a gain falling under a provision deleted by the earlier amendment does not alter the result. Then trace every step by which the warrant securities reached the taxpayer, because the limit turns on whether they came from the issuing corporation or an underwriter. Finally, confirm that the tax authority is not relying on a separate provision that expressly taxes the excluded transaction.
From the official text
Points at issue
[1] 구 상속세 및 증여세법 제40조 제1항 제2호 (나)목은 전환사채 등을 인수·취득한 주주와 발행 법인 간에 특수관계가 존재하고, 아울러 발행 법인 또는 자본시장과 금융투자업에 관한 법률 제9조 제12항에 따른 인수인으로부터 전환사채 등을 인수·취득하는 등의 요건을 정하여 과세대상과 과세범위를 한정함으로써 증여세 과세의 범위와 한계를 설정한 것인지 여부(적극) [2] 구 상속세 및 증여세법 제4조 제1항 제6호는 개별 가액산정규정이 설정한 증여세 과세의 범위와 한계에 들어맞지 않아 증여세 과세대상에서 제외되는 거래·행위도 특별히 과세대상으로 삼기 위한 별도의 규정인지 여부(소극)
Unofficial English translation
[1] Whether Article 40 (1) 2 (b) of the former Inheritance Tax and Gift Tax Act, by establishing requirements such as that a special relationship exists between the shareholder who has subscribed for or acquired convertible bonds, etc. and the issuing corporation, and that the convertible bonds, etc. are subscribed for or acquired from the issuing corporation or from an underwriter as defined in Article 9 (12) of the Financial Investment Services and Capital Markets Act, and by thus limiting the taxable subject and the scope of taxation, set the scope and limits of gift tax taxation (affirmative) [2] Whether Article 4 (1) 6 of the former Inheritance Tax and Gift Tax Act is a separate provision intended to specially make transactions or acts taxable that fall outside the scope and limits of gift tax taxation set by the individual valuation provisions and are therefore excluded from the subjects of gift tax taxation (negative)
Summary of the holding
The official text publishes no summary of the holding for this decision. The quotation and factors in this record are copied verbatim from the points at issue; the evidence for each axis is taken from the points at issue, the order and the reasons.
Order
상고를 기각한다. 상고비용은 피고가 부담한다.
Unofficial English translation
The appeal is dismissed. The costs of the final appeal shall be borne by the defendant.
Provisions referred to
[1] 구 상속세 및 증여세법(2016. 12. 20. 법률 제14388호로 개정되기 전의 것) 제40조 제1항 제2호 (나)목 [2] 구 상속세 및 증여세법(2016. 12. 20. 법률 제14388호로 개정되기 전의 것) 제4조 제1항 제6호
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