(1) Any loss recorded in calculating the amount of business income generated in the relevant taxable period, according to the books recorded and kept by a business entity, shall be deducted from the amount of wage and salary income, the amount of pension income, the amount of other income, the amount of interest income, and the amount of dividend income in order when calculating the tax base of global income for such taxable period.
(2) Notwithstanding paragraph (1), any loss incurred in any of the following business (hereinafter referred to as "real estate leasing business"), shall not be deducted when calculating the tax base of global income: Provided, That the same shall not apply to residential house leasing business: <Amended by Act No. 12852, Dec. 23, 2014; Act No. 15225, Dec. 19, 2017>
1. Business leasing real estate or rights in real estate;
2. Business leasing factory foundations or mining foundations;
3. Business prescribed by Presidential Decree, as business leasing mining rights.
(3) Any loss from a real estate leasing business and any leftover loss after deduction pursuant to paragraph (1) and the proviso to paragraph (2) (hereinafter referred to as "loss carried forward"), shall be deducted in order, beginning with the first loss carried forward to be incurred in the taxable period according to the following classification when calculating income for the taxable period expiring within 15 years from the end of the taxable period in which the relevant loss carried forward occurs: Provided, That where a loss carried forward for a taxable period before the limitation period is confirmed after such limitation period of the imposition of national taxes pursuant to Article 26-2 of the Framework Act on National Taxes has passed, such loss carried forward shall not be deducted: <Amended by Act No. 12852, Dec. 23, 2014; Dec. 29, 2020>
1. A loss carried forward remaining after taking a deduction pursuant to paragraph (1) and the proviso to paragraph (2) shall be deducted from business income, wage and salary income, pension income, other income, interest income, and dividend income in this order;
2. A loss carried forward which occurs from a real estate leasing business shall be deducted from income of the real estate leasing business.
(4) Paragraph (3) shall not apply where an estimated tax return (referring to a return filed not in accordance with the books kept and recorded and evidentiary documents pursuant to Articles 160 and 161; hereinafter the same shall apply) is filed on income in the relevant taxable period or a decision for additional assessment is made pursuant to the proviso to Article 80 (3): Provided, That this shall not apply where an estimated tax return is filed or a decision for additional assessment is made because the books and other evidentiary documents are destroyed or lost by a natural disaster or other force majeure.
(5) When deducting a loss and a loss carried forward pursuant to paragraphs (1) and (3), if any dividend income or interest income is subject to global taxation pursuant to Article 14 in the calculation of the amount of tax pursuant to Article 62, the amount of such dividend income or interest income subject to withholding tax rate shall be exempt from deduction of a loss or a loss carried forward, and with regard to the amount subject basic tax rates among such dividend income or interest income, a business entity may elect whether to take a deduction, and the amount of deduction within the extent of the amount of income.
(6) When deducting a loss and a loss carried forward pursuant to paragraphs (1) and (2), where a loss is incurred and a loss is carried forward in the relevant taxable period, the loss for the taxable period shall be first deducted from income.[This Article Wholly Amended by Act No. 9897, Dec. 31, 2009]