소득세법상 거주자 규정 개선방안 연구 – 국외소득탈세방지를 위하여 –

Abstract

The residency rules under the Income Tax Act play a key role as they define the scope of tax liability. Tax resident means a person having his/her domicile or place of residence in Korea for more than 183days. Anyone who is not a tax resident is called a non-resident. An individual's domicile is determined by an objective test on facts related to his/her living relationship. However, relevant rules are not very clear and cause tax disputes between taxpayers and tax authority. Additionally, in cases of an individual with dual residency, the rules in tax treaties determine the country where the individual resides based on his/her permanent abode, center of living relationship and day-to-day place of resident.  However, since the detailed rules and concepts are still regulated by each country's domestic tax acts, hence the relevant conflicts and disputes are not completely resolved. In order to eliminate the aforementioned problems, the existing concept of 'domicile' needs further clarification. Particularly, it is necessary to enact provisions that specify detailed objective tests on living relationship, which is one of the criteria determining 'domicile', by referring to the relevant legislations in the United Kingdom. On the other hand, there are many occasions where individuals deliberately move their domicile to tax havens or jurisdictions that grant tax exemption for their overseas income in an attempt to avoid application of tax rules of Korea, which is based on residence principle. Also, a person, who has intentionally shifted his/her domicile to tax heaven, has to bear tax liability in Korea in spite of his/her domicile located in tax heavens, in accordance with the nationality principle adopted by the United States. Considering the tax authority's inadequate administrative capacity and tax equity between taxpayers who are utilizing tax havens and those who are not, adoption of the nationality principle is strongly recommended.