(1) Where a corporation prescribed by Presidential Decree among domestic corporations operating a credit guarantee business under Acts appropriates funds for redemption of claims for indemnity as deductible expenses when the settlement of account is fixed for each business year, such funds for redemption of claims for indemnity appropriated shall be included in deductible expenses for the purpose of calculating the amount of income for the relevant business year up to the amount calculated, as prescribed by Presidential Decree. <Amended on Dec. 24, 2018>
(2) In applying paragraph (1), where a corporation prescribed by Presidential Decree among corporations applying the K-IFRS appropriates funds for redemption of claims for indemnity in the tax settlement invoice referred to in Article 60 (2) 2 and accumulates such appropriation as reserves for appropriation for redemption of claims for indemnity in disposing of the profits during the relevant business year, it shall be deemed to have been appropriated in deductible expenses when the settlement of account is fixed up to the amount calculated, as prescribed by Presidential Decree. <Amended on Dec. 24, 2018>
(3) Where bad debts prescribed by Presidential Decree have incurred in relation to the claims for indemnity due to credit guarantee business, a domestic corporation that has included appropriation for redemption claims for indemnity under paragraph (1) in deductible expenses shall first offset the bad debts with the appropriation for redemption of claims for indemnity and the remainder of the appropriation for redemption of claims for indemnity after the offset shall be included in gross income when calculating the amount of income for the following business year.
(4) A domestic corporation which intends to apply paragraph (1) shall submit a detailed statement on the appropriation for redemption of claims for indemnity to the head of the tax office having jurisdiction over the place of tax payment, as prescribed by Presidential Decree. <Amended on Dec. 24, 2018>
(5) Matters necessary for disposing of the appropriation for redemption of claims for indemnity under paragraph (1) shall be prescribed by Presidential Decree.[This Article Wholly Amended on Dec. 30, 2010]