(1) Where a divided corporation acquires stocks, etc., of a corporation established through division through a split-off and meets the requirements for a qualified division provided for in Article 46 (2) and (3) (in cases falling under sparagraph (2) 2 of the same Article, limited to where the full consideration of a division is in stocks, etc.), an amount equivalent to capital gains on the transfer of assets generated by the split-off among the value of such stocks, etc., may be included in deductible expenses when calculating the amount of income for the business year which includes the registration date of the split-off, as prescribed by Presidential Decree; provided, an amount equivalent to capital gains on the transfer of assets may be included in deductible expenses, as prescribed by Presidential Decree, although the requirements prescribed in Article 46 (2) 2, 3 or 4 are not met, in extenuating circumstances prescribed by Presidential Decree. <Amended on Dec. 31, 2011; Dec. 19, 2017; Dec. 31, 2022>
(2) An amount equivalent to capital gains on a transfer that a divided corporation has included in deductible expenses under paragraph (1), shall be included in the gross income as much as the amount prescribed by Presidential Decree in consideration of the ratio of disposition of the relevant stocks, etc., and assets in the business year in which any of the following grounds arises; provided, the foregoing shall not apply where a corporation established through division becomes subject to a qualified merger or qualified division or where such corporation is in other extenuating circumstances prescribed by Presidential Decree: <Amended on Dec. 31, 2011; Jan. 1, 2013>
1. Where a divided corporation disposes of the stocks, etc., received from the corporation established through division;
2. Where the corporation established through division disposes of the assets prescribed by Presidential Decree and succeeded to from a divided corporation. In such cases, the corporation established through division shall inform the divided corporation of the disposition of such assets within one month from the date of the disposition.
(3) Where either of the following events occurs during the period prescribed by Presidential Decree, which shall not exceed three years from the registration date of a division, the divided corporation that has included an amount equivalent to capital gains on a transfer in deductible expenses under paragraph (1) shall include, in gross income, any remainder after including an amount in gross income under paragraph (2), among the amount included in deductible losses under paragraph (1), when calculating the amount of income for the business year in which the relevant event occurs; provided, the same shall not apply in extenuating circumstances prescribed by Presidential Decree: <Amended on Dec. 31, 2011; Jan. 1, 2014; Dec. 20, 2016; Dec. 19, 2017>
1. Where a corporation established through division discontinues the business succeeded to from the divided corporation;
2. Where the divided corporation holds less than 50/100 of the total number of outstanding stocks or the total investment amount of a corporation established through division;
3. Where the number of the employees specified by Presidential Decree (hereafter in this subparagraph, referred to as "employees") as employees of the corporation established through division as at the end of each business falls below 80/100 of the sum of employees of the divided business division as at one month before the date of registration of the merger.
(4) Where a divided corporation includes an amount equivalent to capital gains on a transfer in deductible expenses under paragraph (1), the corporation established through division shall succeed to any amount included in or excluded from gross income or deductible expenses by the divided corporation in calculating the amount of income and the tax base for each business year, other assets and liabilities and tax exemptions, tax reductions and tax credits under Article 59, etc., as prescribed by Presidential Decree. <Added on Dec. 31, 2011; Dec. 19, 2017>
(5) Tax exemptions, tax reductions and tax credits to which a corporation established through division succeeds from the divided corporation shall apply within the amount of income accruing from the business transferred from the divided corporation or within the amount of corporate tax on such income, as prescribed by Presidential Decree. <Added on Dec. 19, 2017>
(6) A divided corporation that intends to apply paragraph (1) shall submit a statement on capital gains on a transfer of assets generated by the division to the head of the tax office having jurisdiction over the place of tax payment, as prescribed by Presidential Decree. <Amended on Dec. 31, 2011; Dec. 19, 2017>
(7) Matters necessary for calculating capital gains on a transfer, criteria for determining the continuation or discontinuation of the succeeded business, calculation of the amounts included in gross income or deductible expenses, the method of inclusion under paragraphs (1) and (5), and other matters, shall be prescribed by Presidential Decree. <Amended on Dec. 31, 2011; Dec. 19, 2017>[This Article Wholly Amended on Dec. 30, 2010]