(1) Where a business entity receives a subsidy under the Subsidy Management Act (hereinafter referred to as "national subsidy") and disburse it for the acquisition or improvement of assets for business purpose, or acquires or improves the assets for business purposes, and receives a national subsidy therefor afterwards, the amount equivalent to a national subsidy disbursed for the acquisition or improvement of assets for business purposes may be included in necessary expenses when calculating the amount of income in the taxable period to which the date he/she receives such national subsidy belongs, as prescribed by Presidential Decree. <Amended by Act No. 10408, Dec. 27, 2010; Act Nos. 10898 & 10907, Jul. 25, 2011>
(2) Where he/she is unable to acquire or improve assets for business under paragraph (1) in the taxable period to which the date he/she receives a national subsidy belongs, paragraph (1) shall apply mutatis mutandis to only such assets acquired or imported by no later than the end of the taxable period following such taxable period. In such cases, where he/she fails to use the national subsidy by the deadline due to extenuating circumstances prescribed by Presidential Decree, such as delay in permission or approval of construction work, the end of the taxable period to which the date the relevant circumstance ceases to exist belongs shall be the deadline.
(3) Any person who intends to include a national subsidy in necessary expenses pursuant to paragraph (2) shall submit a plan for use of such national subsidy to the head of a tax office having jurisdiction over the place for tax payment, as prescribed by Presidential Decree.
(4) If any person who has included a national subsidy in necessary expenses pursuant to paragraph (1) or (2) falls under any of the following, the amount equivalent to such national subsidy shall be included in the total income in the taxable period when the relevant cause thereof has taken place:
1. Where he/she fails to use the national subsidy for the acquisition or improvement of assets for business under paragraph (1) by the deadline;
2. Where he/she discontinues the relevant business by the deadline under paragraph (2).[This Article Wholly Amended by Act No. 9897, Dec. 31, 2009]