SK hynix operates globally with subsidiaries in 16 countries. As a global leader in the semiconductor industry, we are dedicated to providing products with state-of-the-art technology that connect the world and make people’s lives more convenient. Since our business can have a critical impact on the economy and society, we are deeply aware of our social responsibility in relation to tax.

We are striving to meet our social duty voluntarily by complying with the tax requirements in each and every country we operate in. To fulfill our duty in relation to taxation, we aim to:

• Understand and comply with the intent of tax laws
• Recognize an appropriate amount of tax to each and every tax jurisdiction²⁾ we operate in, based on value creation
• Prepare, submit and retain pertinent tax information in required forms on time, as required by tax laws and tax authorities
• Employ qualified and trained tax specialists with knowledge and understanding of our business
• Actively use professional tax advisers from the outside when specialized knowledge is required for intricate, uncertain or significant tax issues

1.稅務風險管控方向

Established internal policies and business procedures for tax reporting and regulatory compliance. In addition, tax risk is effectively managed.
We believe that complying with tax laws is a way to protect our company from possible tax risks in creating future value.

• 1) Ensuring global compliance

  We aim to abide by the compliance principles of each country where our business operates in. We aim to perform all our tax compliance duties including reporting and making tax payments in accordance with local tax laws as well as submitting relevant documents and data to tax authorities when required.

• 2) Transparent trade

  We have established a transfer pricing policy based on the ‘arm’s length principle’ that is generally accepted by all jurisdictions who abide by OECD guidelines and we strive to pay the proper amount of tax in each and every tax jurisdiction where income is generated. Our financial officer is responsible for the administration, preparation, revision and approval of our transfer pricing policy. The international tax department reports to the board of inspection in case there are important revisions to the transfer pricing policy.

• 3) Preparation of BEPS documentation

  In accordance with the OECD’s BEPS (Base Erosion and Profit Shifting) action plan, many countries have amended their tax laws. We understand the intent of the BEPS declaration and comply with the renewed policies and processes according to the amended laws. We also faithfully comply with our global Country by Country Report guidelines.

2. Our attitude towards tax planning

We do not engage in any aggressive tax planning, including abusing tax havens, low tax jurisdictions or exploit the tax structure as a method of tax evasion. We act with a resolute mindset in the spirit of being a responsible tax payer. We strive to manage tax efficiently to create maximum value and contribute to society. We work towards satisfying the interests of stakeholders such as society, shareholders, and employees without conflicts with the tax authorities. Our internal transactions are performed based on the arm’s length principle, which is periodically updated in consideration of changes that may occur in our business environment.

3. The level of tax risk management we can handle

We comply with the tax laws in each jurisdiction in which we operate. However, we acknowledge that we cannot eliminate all tax risks due to the complexity of tax laws and differences in interpretation. Accordingly, we are committed to identifying and monitoring significant tax risks at the group level and will seek advice from tax specialists. In addition, we acknowledge the amendments/establishments of international tax laws in time and take active measures.

We are focused on identifying and determining uncertain tax issues at an early stage. Where any tax law that is unclear or may be controversial in terms of interpretation has a significant impact on our business, we will solve this problem by communicating with tax authorities in cooperation with external experts.

4. Our attitude toward tax authorities

Our engagement with tax authorities is an important and essential part of our taxation related activities. We aim for our engagement with tax authorities to be transparent, honest and professional. We believe that such an approach will enable us to mitigate or clear uncertainties in the most efficient way possible. Upon the request of tax authorities, we aim to provide relevant information through local accounting managers in each country under the group’s tax strategy in a timely manner. We are also prepared to invest considerable efforts to reach an agreement with tax authorities when each party has a different point of view.